2024-05-05 06:00

Most Read: Gold Price Forecast: Bearish Correction May Extend Further Before Turnaround The U.S. dollar, as tracked by the DXY index, retreated sharply this past week, briefly reaching its lowest point since April 10th. This selloff stemmed primarily from falling U.S. Treasury yields following the Federal Reserve's monetary policy announcement and weaker-than-anticipated U.S. employment numbers. Ultimately, the DXY dropped nearly 1%, settling just above the 105.00 mark. US DOLLAR INDEX WEEKLY PERFORMANCE US Dollar (DXY) Chart Created Using TradingView Initially, the greenback's decline was triggered by Fed Chair Powell's dovish remark at the central bank’s last meeting, indicating that a rate cut is still likely to be the next policy move despite rising inflation risks. Subsequently, the US non-farm payrolls report, which revealed an unexpected cooling in job creation accompanied by softer wage pressures, further reinforced the currency's downward reversal. Want to know where the U.S. dollar may be headed over the coming months? Explore key insights in our second-quarter forecast. Request your free trading guide now! Looking ahead, the prospect of Fed easing irrespective of conditions, coupled with increasing signs of economic fragility reflected in recent data, should prevent bond yields from heading higher, removing from the equation a bullish catalyst that has benefited the U.S. dollar this year. This could lead to further weakness in the short term, at least during the first part of the month. EUR/USD FORECAST - TECHNICAL ANALYSIS EUR/USD rallied this past week, breaking above several resistance zones and coming within a hair's breadth of breaching the 50-day and 200-day SMA. Bears need to keep prices below these technical indicators to contain upside momentum; failure to do so could spark a move toward trendline resistance at 1.0830. On further strength, attention will be on a key Fibonacci barrier near 1.0865. In the event of a bearish reversal, minor support areas can be identified at 1.0750, 1.0725 and 1.0695 thereafter. Below these levels, all eyes will be on the week’s swing low around 1.0645, followed by April’s through around the psychological 1.0600 mark. EUR/USD PRICE ACTION CHART EUR/USD Chart Created Using TradingView GBP/USD FORECAST - TECHNICAL ANALYSIS GBP/USD also climbed this past week, but the advance lacked impulse, with prices failing to close above the 200-day simple moving average. Traders should keep a close eye on this indicator in the coming days, bearing in mind that a decisive breakout could pave the way for a retest of confluence resistance near 1.0620. On the flip side, if sellers return and propel cable lower, support stretches from 1.2515 to 1.2500. Bulls need to keep prices above this range to mitigate the risk of escalating selling pressure, which could potentially steer the pair towards 1.2430. Subsequent declines from this point forward could bring into consideration the 1.2300 handle. GBP/USD PRICE ACTION CHART GBP/USD Chart Created Using TradingView https://www.dailyfx.com/news/forex-usd-dollar-forecast-bearish-market-signals-emerge-setups-on-eur-usd-gbp-usd-20240505.html

2024-05-04 18:00

GOLD PRICE OUTLOOK: Gold prices fell 1.55% this week, briefly touching their lowest level since early April The current downward correction shows potential for further extension despite positive fundamentals This article explores XAU/USD’s technical outlook for the coming days and weeks Most Read: British Pound Weekly Forecast - BoE Policy Call Tops The Bill Gold (XAU/USD) dropped for the second straight week, with prices settling just above the $2,300 threshold heading into the weekend. This occurred against a backdrop of relatively moderate volatility following key market developments, notably the Federal Reserve's monetary policy announcement midweek and the release of the U.S. employment report on Friday. Bullion’s retreat caught many traders off guard, as they had anticipated a stronger response amidst falling U.S. bond yields, which fell sharply after Fed Chair Powell dismissed the idea of resuming rate hikes and indicated the next move is still likely to be a cut, despite renewed inflation worries. This dovish stance injected a sense of optimism into the market, boosting risk assets at the expense of defensive plays. Even the U.S. jobs report, arriving weaker than anticipated and emboldening FOMC easing wagers, failed to prop up the precious metal. While traders may find the market's reaction perplexing, it's important to acknowledge that the frequently dominant inverse relationship between gold and rates significantly weakened earlier this year, with both going up at the same time. Looking ahead, mounting signals of economic vulnerability, the Fed’s plans to start easing, and the emerging downtrend in the U.S. dollar, should be bullish for precious metals, at least in theory. However, given the significant rally already seen in the space this year and its detachment from fundamentals, it would not be surprising to see gold continue to deflate or trade sideways, bucking tailwinds. GOLD PRICE TECHNICAL ANALYSIS After a poor performance this week, gold (XAU/USD) briefly hit its lowest mark in nearly a month, yet succeeded in maintaining its position above support at $2,280. Bulls will need to protect this floor fiercely; a lapse in defense could trigger a descent toward a key Fibonacci level at $2,260. Continued losses from this juncture would bring the 50-day simple moving average at $2,235 into play. In the event of a bullish turnaround from present levels, the first technical hurdle to watch closely can be identified at $2,325, followed by $2,355. Although reclaiming this territory might pose some difficulty for buyers, a decisive breakout could pave the way for a rally towards $2,375 - a short-term descending trendline originating from the record high. GOLD PRICE TECHNICAL CHART Gold Price Chart Created Using TradingView https://www.dailyfx.com/news/xau-usd-gold-price-forecast-bearish-correction-may-extend-further-before-turnaround-20240504.html

2024-05-03 13:03

US Dollar Slumps After NFPs Miss Expectations, US Equities Bid US NFPs print at 175k vs. forecasts of 243k. US dollar slumps as rate cut expectations improve. The latest US Jobs Report showed hiring slowed in April with just 175k new jobs added compared to forecasts of 243k and an upwardly revised 315k in March (from 303k). Average hourly earnings y/y fell by two-tenths of a percentage point to 3.9%, while the unemployment rate ticked 0.1% higher to 3.9%. Today’s release pushed market expectations of rate cuts higher, with the latest probabilities showing around 50 basis points of rate cuts this year. At the start of the week, this figure was around 28 basis points. According to market forecasts, a September rate cut is now fully priced in. Learn how to trade data and news events with our free, expert guide. The US dollar fell sharply post-NFP release with the dollar index breaking through the 105.00 level with ease. The next level of support, the 38.2% Fibonacci retracement level, is seen at 104.38. US Dollar Index Daily Chart US indices pushed higher after the Jobs Report with Nasdaq futures adding 200 points before drifting a touch lower… Nasdaq Futures 10 Minute Chart …while the S&P futures added just over 40 points. S&P 500 Futures 10 Minute Chart What are your views on the US Dollar – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1. https://www.dailyfx.com/news/us-dollar-slumps-after-nfps-miss-expectations-us-equities-bid-20240503.html

2024-05-03 11:30

Euro (EUR/USD) Latest Analysis and Charts EUR/USD rises for a third straight day Corporate earnings have boosted overall risk appetite US labor stats are firmly in focus The Euro was higher against the United States Dollar on Friday with market risk appetite sending the latter broadly lower. Apple’s second-quarter earnings generally pleased, or relieved, the crowds after their release on Thursday. They beat expectations across various metrics and added a blockbuster, $110 billion share buyback. It wasn’t all good news by any means, however. The tech giant fretted a challenging demand environment, particularly in China, but equity investors were disposed to focus on the positives. French banks have added to the cheer on Friday, with strong reports from Credit Agricole and Societe Generale. While the Euro has benefitted from a generally more upbeat market risk tone, it’s hard to see the current rally lasting given that prospects for the European Central Bank’s monetary policy seem to diverge markedly from those for the Federal Reserve. The ECB is expected to fire the starting gun on rate reductions next month, while the market is now starting to doubt whether we’ll see any similar action from the Fed at all this year given the enduring spring in the US economy’s step. The Euro held gains on Friday despite news of a surprise fall in French industrial production which only underlines the contrasting fortuned of the Eurozone and US. The next major trading cue for EUR/USD and, of course, most other markets, will be the release of key US labor market statistics later on Friday. Expectations center around a 243,000 April rise in nonfarm payrolls and a steady overall unemployment rate of 3.8%. A stronger release will cast more doubt on the prospect of US rate cuts this year and may see EUR/USD gains fizzle. EUR/USD Technical Analysis EUR/USD Daily Chart Compiled Using TradingView EUR/USD’s uptrend from mid-May has seen the pair edge back into the broad trading band that contained trade between early January and mid-April. That now offers support at February 14’s low of 1.06950 and retracement support at 1.07205. Bulls will face resistance at the 50-day moving average which comes in at 1.07916, with 1.08815 and 1.08534 waiting above that. The latter level is derived from the downtrend line from the peak of December 28. IG’s own sentiment index suggests that EUR/USD’s near-term path is uncertain, with a narrow majority of 53% bearish at current levels. However, despite two weeks of steady gains, the pair’s Relative Strength Index shows it by no means overbought, suggesting that the path higher remains open if risk appetite holds up. --By David Cottle for DailyFX https://www.dailyfx.com/news/euro-gains-again-as-risk-appetite-holds-up-into-key-us-payroll-release-20240503.html

2024-05-03 07:49

Apple (APPL) Soars, Gold Struggles, USD and VIX Slip, Sentiment Positive Ahead of NFPs Apple drives risk sentiment ahead of US NFPs. Japanese Yen is starting to push higher after intervention. US dollar slips to a three-week low. Learn how to trade a range of market conditions with our free trading guides Apple’s Q2 earnings are giving markets an early boost, after the world’s 2nd largest company beat market expectations across a range of metrics and announced a record-breaking USD110 billion share buyback, up from USD90 billion last year. Apple shares rose by 2.3% during regular hours and added nearly 6% in after-hours trading. The move higher has broken a recent series of lower highs and leaves $196-$200 as the next zone of resistance. Apple (APPL) Daily Chart IG All Sessions Chart Keep informed of all earnings releases with the DailyFX Earnings Calendar The Japanese Yen is finally seeing the benefit from the recent rounds of official intervention and is pushing higher, in holiday-thinned trade. USD/JPY is back just above 153.00, its lowest level in nearly three weeks, and is moving towards a prior area of interest around 151.90. Below here 150.00 comes into focus. Japan is closed on Monday 6th. USD/JPY Daily Chart Chart via TradingView A recent sell-off in US Treasury yields is weighing on the US dollar. UST 2s hit 5.04% on Thursday and are now quoted at around 4.93%, while the benchmark UST 10s are offered at 4.63%, around 7 basis points lower than this week’s high. The US dollar index remains channel bound and recent thoughts that a bullish flag was forming are being tested. Today’s US Jobs Report (13:30 UK) will decide the dollar’s fate ahead of the weekend. US Dollar Index Daily Chart Chart via TradingView The latest bout of risk-on sentiment can be seen in the VIX ‘fear gauge’ which is now testing multi-week lows. The VIX is now testing both the 50- and 200-day simple moving average, and a confirmed break below these two indicators could see the VIX testing a cluster of prior lows down to the 12.00 level in the coming days. VIX Daily Price Chart Chart via TradingView Gold is trading sideways in a small range today after this week’s break out from a bearish flag setup. The precious metal has tested support around $2,280/oz. on three occasions this week and a weaker-than-expected US Job Report or a further strengthening of the current risk-on move will see gold test this support again. Gold Daily Price Chart Charts via TradingView IG Retail Sentiment show 55.89% of traders are net-long with the ratio of traders long to short at 1.27 to 1.The number of traders net-long is 5.87% higher than yesterday and 1.20% higher than last week, while the number of traders net-short is 2.14% lower than yesterday and 2.91% lower than last week. We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Gold prices may continue to fall. Are you risk-on or risk-off ?? You can let us know via the form at the end of this piece or contact the author via Twitter @nickcawley1. https://www.dailyfx.com/news/market-update-apple-soars-gold-struggles-usd-and-vix-slip-sentiment-positive-ahead-of-nfps-20240503.html

2024-05-02 17:00

Most Read: US Dollar Outlook Post Fed Decision: EUR/USD & GBP/USD - Technical Analysis The U.S. dollar (DXY) experienced a slight decline on Thursday, continuing its pullback following the Federal Reserve's monetary policy decision in the previous session. To recap, the central bank kept borrowing costs unchanged within their current target range of 5.25%-5.50%, in line with expectations, while maintaining an easing bias in its forward guidance. A noteworthy development was the Fed's decision to significantly taper the pace of its quantitative tightening program. Beginning in June, the monthly amount of maturing Treasuries allowed to roll off the balance sheet will be cut from $60 billion to a mere $25 billion. This move caught many bond dealers off guard, as most anticipated a smaller reduction. On the inflation front, policymakers sounded the alarm bells, indicating that there has been a lack of further progress on cooling price pressures in recent months – a hawkish acknowledgment. However, Chair Powell's subsequent press conference offered a counterbalancing message. While he did signal that the bar to start cutting rates is high, he suggested an even more rigorous standard for resuming hikes. Want to know where the U.S. dollar may be headed over the coming months? Explore key insights in our second-quarter forecast. Request your free trading guide now! With the Fed failing to embrace a hawkish posture decisively, yields may find it difficult to sustain an upward trajectory. This outcome could, in turn, strip the U.S. dollar of a key bullish catalyst, particularly if incoming economic data begins to weaken materially. That said, Friday's highly anticipated April employment survey is a key event to watch, with economists expecting around 243,000 new jobs. A weaker-than-expected nonfarm payrolls report could shift the narrative again, prompting traders to start discounting more monetary easing for 2024, creating a hostile environment for the U.S. dollar. On the other hand, hotter-than-forecast job growth might force markets to price in a scenario of higher interest rates for longer – a bullish outcome for the greenback. UPCOMING NFP REPORT EUR/USD FORECAST - TECHNICAL ANALYSIS EUR/USD trended lower on Thursday after an unsuccessful attempt to clear the resistance at 1.0725, with prices moving back towards the 1.0700 handle. Traders should closely monitor this support area in the coming days, as a break below it could trigger a pullback towards 1.0645 and potentially even 1.0600. In the event of a bullish reversal from current levels, the first technical ceiling worth keeping an eye on in the near term is situated at 1.0725, followed by 1.0755. Further upward momentum will draw attention to the 1.0800 zone, where the 50-day and 200-day simple moving averages currently intersect. EUR/USD PRICE ACTION CHART EUR/USD Chart Created Using TradingView GBP/USD FORECAST - TECHNICAL ANALYSIS GBP/USD also edged down on Thursday, but managed to stabilize around the 1.2515/1.2500 range. Bulls must strive to maintain prices above this support region to prevent sentiment towards the pound from deteriorating; otherwise, sellers could seize the opportunity to launch a bearish assault on 1.2430. On the other hand, if buyers make a new appearance and propel prices higher, resistance emerges at 1.2550, where the 200-day simple moving average converges with a short-term descending trendline. Moving further up, attention will be focused on Fibonacci resistance at 1.2590, followed by 1.2620. GBP/USD PRICE ACTION CHART GBP/USD Chart Created Using TradingView https://www.dailyfx.com/news/forex-usd-dollar-on-tenterhooks-ahead-of-us-jobs-data-setups-on-eur-usd-gbp-usd-20240502.html