News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Mixed
Gold
Bullish
GBP/USD
Mixed
USD/JPY
Bearish
More View more
Real Time News
  • Indices Update: As of 13:00, these are your best and worst performers based on the London trading schedule: FTSE 100: 1.57% France 40: 1.05% Germany 30: 0.91% Wall Street: 0.54% US 500: 0.19% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/LWKi3vz4C3
  • Heads Up:🇺🇸 Markit Manufacturing PMI Flash (SEP) due at 13:45 GMT (15min) Expected: 53.1 Previous: 53.1 https://www.dailyfx.com/economic-calendar#2020-09-23
  • 'big things have small beginnings' $Gold pullback started to show bearish tendencies on the same day that it set an all-time-high. That daily bar on Aug 7 closed as bearish engulf - buyers have been on their back foot since. https://t.co/qpGkOJCL3J https://t.co/d3PPQ9vf5U
  • 🇺🇸 House Price Index MoM (JUL) Actual: 1% Previous: 1% https://www.dailyfx.com/economic-calendar#2020-09-23
  • 1900-1920 support no longer in $Gold down to the next spot on the chart - 1871 is 50% of June-August bullish move. That monthly chart though - working on a non-completed evening star formation (img 2) https://t.co/piWVcG2RBh https://t.co/KVhkJiM8Sx
  • 🇺🇸 House Price Index MoM (JUL) Actual: 1.0% Previous: 0.9% https://www.dailyfx.com/economic-calendar#2020-09-23
  • Heads Up:🇺🇸 Fed Mester Speech due at 13:00 GMT (15min) https://www.dailyfx.com/economic-calendar#2020-09-23
  • Heads Up:🇺🇸 House Price Index MoM (JUL) due at 13:00 GMT (15min) Previous: 0.9% https://www.dailyfx.com/economic-calendar#2020-09-23
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.27%, while traders in NZD/USD are at opposite extremes with 66.87%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/peklh4PMnX
  • Entry orders are a valuable tool in forex trading. Traders can strategize to come up with a great trading plan, but if they can’t execute that plan effectively, all their hard work might as well be thrown out. Learn how to place entry orders here: https://t.co/lAFyv1gM0P https://t.co/fXShtfgera
Dollar Fades with Fed Advantage, Can Banks Buybacks Carry Risk?

Dollar Fades with Fed Advantage, Can Banks Buybacks Carry Risk?

2017-06-29 00:45:00
John Kicklighter, Chief Strategist
Share:

Talking Points:

  • Risk trends bounced, but speculative move happened well before the US bank buyback news and lacked for motivation
  • The Euro extended its run despite the ECB's hawkish walkback, while both the Pound and CAD rallied on hawkish views
  • With a collective rise for three of the most liquid currencies in the FX market, the Dollar was a distinct loser

How are retail traders positioning in the Dollar-based pairs as the currency crashes key technical levels and the DXY nears the midpoint of a 30-year range? Check out the IG speculative sentiment to see.

Volatility held up through this past trading session, but there was some change in direction for some of the key players. Broadly speaking, the fear from the burgeoning 'risk aversion' move in equities and other speculative assets Tuesday balanced out through the subsequent session. The S&P 500 led a rebound to notably engulf Tuesday's full candle (with the gap) and the VIX volatility index dropped back to 10. Whether or not this rebound has legs depends heavily on the motivation for the about face. The economic data on tap lacked the authority to rally confidence in these otherwise skeptical markets. In fact, SF Fed President Williams added to the surface speculative fear when he suggested stocks were 'running on fumes' - more provocative language than Ms Yellen who said markets are 'somewhat rich'. The ECB's efforts to reassure the speculative rank that it wasn't yet turning the corner on its stimulus efforts may add a little buoyancy, but 'a little more time' is not flush of confidence. More likely, the rebound we have found is a reflection of a market not ready to commit to a major trend - bullish or bearish - and therefore is knocked back into range. If that is indeed the case, this move offers little more than what range potential already exists.

Meanwhile, the FX and fixed income markets' connection to monetary policy offers a more definitive fundamental platform to work from. Apparently concerned about the market response his remarks provoked the day before, ECB President Mario Draghi attempted to quell speculation that the major central bank was actively preparing for the inevitable normalization of its extreme monetary policy regime. The central bank took pains to make clear that they are not on the cusp of rate hikes or stimulus reversal. That stalled the Euro's rally against most counterparts - though the EUR/USD was a notable exception. From the ECB's highlight central bank summit panel with heads of the ECB, BoE, BoJ and BoC groups though; the balance of perceived change was a hawkish one. BoE Governor Carney caused another whiplash in speculation on the group's bearings - not his or his Committee's fault - when he suggested they would hike rates if economic conditions warranted. The moves from GBP/USD and EUR/GBP in particular were noteworthy. The biggest move on the day, however, goes to the Canadian Dollar following Governor Poloz's suggestion that his bank too is prepared to tighten should the opportunity arise. USD/CAD extended its tumble to 1.3000 and other Canadian Dollar crosses (like AUD/CAD) have set up appealing technical pictures.

While this past 48 hours has been remarkable for activity, what is important is whether there is trade opportunity to draw out of this moving forward. While there is plenty of interesting technical development (EUR/USD break, USD/CAD breakdown, EUR/GBP channel reversal, etc), the critical ingredient - as always - is potential follow through. These markets are in a philosophical straight where long-held speculative appetite has run through its complacency and is increasingly exuding skepticism as the cost of further investment far outweighs the stagnant expectation for returns. Beyond this changing structural struggle, the peak of seasonal drain is approaching with this forthcoming, long US holiday weekend. Is there enough in what we have seen so far this week that we will be able to overcome the blanket of quiet that has covered us? Is there enough critical event risk or fluid theme to keep raging against the dying light into the end of the week? It is important to keep tabs on the critical dual themes of risk trends and monetary policy to answer this question. Scheduled event risk will lack for impact. We take stock of trading opportunities in this high volatility in today's Trading Video.

To receive John’s analysis directly via email, please SIGN UP HERE.

Dollar Fades with Fed Advantage, Can Banks Buybacks Carry Risk?Dollar Fades with Fed Advantage, Can Banks Buybacks Carry Risk?Dollar Fades with Fed Advantage, Can Banks Buybacks Carry Risk?

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES