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.

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
GBP/USD
Bearish
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
USD/JPY
Bullish
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
Gold
Bearish
Oil - US Crude
Bearish
Bitcoin
Mixed
More View more
Real Time News
  • $USD $CAD $MXN https://t.co/p3bP1d58In
  • #USDCHF pivot points (daily) – S3: 0.9823, S2: 0.9851, S1: 0.9862, R1: 0.9889, R2: 0.9906, R3: 0.9934 - https://www.dailyfx.com/pivot-points?ref=SubNav?utm_source=Twitter&utm_medium=DFXGeneric&utm_campaign=twr
  • Despite hollow assurance from Washington officials that talks are going “well”, markets appear to not be convinced as the potency of these remarks to elicit hope has waned.
  • This "we're really close" kind of repetition from officials feels like hearing from that one friend who is "just five minutes" who actually hasn't even gotten up and showered yet to leave the house. https://t.co/KjORhSzAR9
  • #EURUSD pivot points (daily) – S3: 1.104, S2: 1.1068, S1: 1.1086, R1: 1.1115, R2: 1.1126, R3: 1.1155- https://www.dailyfx.com/pivot-points?ref=SubNav?utm_source=Twitter&utm_medium=DFXGeneric&utm_campaign=twr
  • Stock prices have recorded a string of record highs on hopes that the US and China will soon reach a partial trade deal, but $USDCNH continues to trade above the redline 7.0 level. Get your market update here:https://t.co/hcEjnpc3pl @realvision https://t.co/81W3zR8STz
  • Already said it would be for 2019 at the end of 2018 but okay. "In my view, the global outlook for growth...is pessimistic, given the global trend in recent years toward liberal-alternative ideologies that have a tendency to disrupt markets" - https://t.co/HQuIMhh9LL https://t.co/UmcfiQlpYS
  • En español: Previsión de $GBPUSD - La libra esterlina aplasta al dólar y quiere recuperar su máximo anual; patrón bandera de implicaciones alcistas parece haber sido validado #trading #forex #Brexit #GBP https://t.co/INuhkVuNAz https://t.co/HcrIm0cOSl
  • RT @SaqibReports: Recession watch. Updated. https://t.co/uXawHegMjJ
  • And here are a few #ASEAN, Asia #EmergingMarkets event risk: Dec 10 - Philippine Trade Balance 🇵🇭 - Chinese CPI 🇨🇳 Dec 12 - Philippine Central Bank rate decision 🇵🇭 - Indian CPI and Industrial Production 🇮🇳 - Malaysian Industrial Production 🇲🇾 And US-China #TradeTalks https://t.co/PlXqgVR6Dt
Exposure and Activity Analysis For EUR/USD, VIX, Oil and More

Exposure and Activity Analysis For EUR/USD, VIX, Oil and More

2017-04-18 04:02:00
John Kicklighter, Chief Currency Strategist
Share:

Talking Points:

  • Market conditions reflect a more systemic and objective view of the financial system than technicals and fundamentals
  • Analysis of participation and general active levels can reshape our strategy and trade expectations
  • We do 'market conditions' analysis on EUR/USD, GBP/USD, USD/JPY, AUD/USD, the Dollar Index, the VIX and Oil

See what live coverage is scheduled to cover key event risk for the FX and capital markets on the DailyFX Webinar Calendar.

For many benchmarks, volume matches the low activity level of the markets that register the turnover. Yet, where the daily turnover may be low, the exposure for the dominant portion of these key drivers of the broader financial system remains exceptionally high. These are considerations that fall outside of the traditional technical and fundamental evaluations that we typically run to highlight trade opportunities. That said, these empirical evaluations of market conditions can present a more comprehensive view of the market and its trade potential than the subjective interpretations that often come with the more familiar techniques.

Market conditions as an analysis approach is open to considerable interpretation and ambiguity itself - in fact many usually fold it into their preferred technical or fundamental evaluations. It deserves to be assessed individually and given some general boundaries for interpretation. For me, liquidity and activity are more appropriate for market conditions filtering rather than buried into other analysis types. It isn't always easy to gauge either - much less both. However, there are means for establishing these basics. While far from a perfect measure for the market-at-large, futures offer an easy access proxy for the underlying. Volume that sputters on tight range against a troubled fundamental backdrop with an extreme level of exposure (open interest) can reflect high-risk complacency. There is a considerable amount of this in the market currently.

We look at this combination of market activity, turnover and exposure across a range of assets. EUR/USD reflects a low volume that befits the struggle to clear the multi-month, 300-pip range - itself in a broader 1.1700 - 1.0350, year range. A similar 'sitting duck' picture comes with GBP/USD and AUD/USD. An assumption of persistently measured price action ill prepares those regular traders that ignore the possibility that a tidal wave is a tangible possibility in present conditions. Meanwhile, both USD/JPY and us oil conditions show a greater appreciation of - and trading appetite for - the volatility present. A consistent turnover and relatively-measured exposure reflect markets where traders are more ready to act and have enough market to beat a hasty exit. We discuss what market conditions say about a range of benchmarks in today's Strategy Video.

Exposure and Activity Analysis For EUR/USD, VIX, Oil and MoreExposure and Activity Analysis For EUR/USD, VIX, Oil and MoreExposure and Activity Analysis For EUR/USD, VIX, Oil and More

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

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

DISCLOSURES

News & Analysis at your fingertips.