2024-04-16 11:50

US Dollar Setups (EUR/USD, AUD/USD, USD/JPY) The US dollar appears to benefit from geopolitical uncertainty EUR/USD vulnerability exposed despite an uptick in sentiment data AUD/USD slide continues after uninspiring Chinese GDP data USD/JPY flirts with dangerous level ahead of Japanese CPI Navigate the markets with confidence – get your US Dollar Q2 trading forecast below! USD Appears to Benefit from Geopolitical Uncertainty In what is a rather quiet week for the dollar - as far as scheduled risk (data) is concerned – a thorough analysis of USD pairs can help establish a basis for future price action. The dollar performed extremely well in Q1, particularly against major currencies, and looks set to continue in a similar fashion at the start of the second quarter. Better-than-expected US CPI data provided the catalyst for the recent USD advance, that now appears to be benefitting from an added safe haven boost, keeping the dollar at elevated levels. Due to the sheer robustness of US data (inflation, jobs and growth), markets have had to revise estimates of Fed rate cuts in 2024 and now envision around two 25 basis point (bps) cuts this year. EUR/USD Vulnerability Exposed Despite a Uptick in Sentiment Data The EU and Germany have revealed improving sentiment and confidence data in recent months, suggesting that analysts expect that we have already seen the trough in Europe. Nevertheless, hard data like inflation, employment and growth are on the decline – weighing on ECB policymakers to loosen financial conditions. The ECB’s governing council meets again in June when they will be armed with the latest economic projections when deciding whether it will be appropriate to cut interest rates for the first time since the hiking cycle got under way in 2022. With a June cut largely expected by the market and numerous ECB officials, the euro is likely to remain weak against the high-flying dollar - weighing on EUR/USD. The pair holds just below the 28.6% Fibonacci retracement of the major 2023 decline which may be tested in the short-term considering the current oversold conditions. The recent decline represents the fastest 5-day drop since February 2023 despite the pair opting for consolidation yesterday and seeing a similar start to today's price action. The longer-term direction appears to favour further weakness as the US-EU interest rate differential is expected to widen. The full retracement of the major 2023 decline is the next major level of interest to the downside at 1.0450 but given the rate of decline in EUR/USD, a shorter-term period of consolidation or even a minor retracement may materialise. EUR/USD Daily Chart Source: TradingView, prepared by Richard Snow AUD/USD Slide Continues After Uninspiring Chinese GDP Data The Aussie Dollar has not only retraced its recent advance but has continued to head lower, printing a new yearly low. The recent drop in risk sentiment, fueled by geopolitical uncertainty in the middle east and the prospect of delayed interest rate cuts in the US, is having an impact on the ‘high beta’ currency. Chinese GDP this morning beat expectations but was not enough to convince the market that the economic outlook is improving in a material way. In addition demand data for March was feeble as retail sales and output data appeared soft. AUD/USD dropped below 0.6460 – a level that had roughly supported prices this year despite a momentary breach in February. 0.6365 is the next level to note on the downside with the RSI not yet entering into oversold conditions which suggests there could still be more downside to come for the Aussie. A short-term pullback may test the 0.6460 level in the interim. AUD/USD Daily Chart Source: TradingView, prepared by Richard Snow USD/JPY Flirts with Dangerous Level Ahead of Japanese CPI USD/JPY was provided with further bullish impetus after yesterday’s US retail sales came out better-then-expected which continues the bullish USD outlook. Numerous warnings from Japanese officials, including the finance minister, failed to deter the sharp moves higher in the pair – teeing up the potential for direct FX intervention to strengthen the yen. The issue Japan is having is even with the latest rate hike out of negative territory, the carry trade incentive is still very appealing given the interest rate differential that exists between the US and Japan. Unless the Bank of Japan hikes rates in a meaningful way, the carry trade is likely to continue. USD/JPY approaches 155.00, a level identified by the former top currency official, Mr. Watanabe as a possible area where officials may intervene. If the pair is allowed to trade higher from there, the 160 mark comes into focus as the level of resistance last seen in 1990. Bullish trade setups from here are fraught with risk and provide an unappealing risk-reward ratio given the extreme volatility that typically follows direct FX intervention (downside risk). Levels to the downside include 152.00 and 150.00 flat. USD/JPY Daily Chart Source: TradingView, prepared by Richard Snow Stay up to date with the latest breaking news and themes driving the market by subscribing to our weekly DailyFX newsletter https://www.dailyfx.com/news/us-dollar-playbook-technical-setups-for-eur-usd-aud-usd-usd-jpy-20240416.html

2024-04-16 07:34

GBP/USD Analysis and Charts UK jobs market stalls, real average earnings remain positive. Tomorrow’s UK inflation report looks key for Sterling. Cable may test the 1.2300 area. Most Read: British Pound Weekly – Will UK Data Help Stem the Latest GBP/USD Sell-Off? According to the latest Office for National Statistics data, the UK unemployment rate reaches 4.2% in February, surpassing market expectations of 4.0% and the previous month's reading of 3.9%. Average earnings, including bonuses, remain unchanged at 5.6%, while earnings excluding bonuses decrease slightly by 0.1% to 6.0%. The current UK labor market statistics demonstrate a slight uptick in unemployment and a stable wage growth trend, providing insights into the country's economic health and employment landscape. The upcoming UK inflation report for March is now crucial for the short- to medium-term outlook of the British Pound (GBP). The UK inflation rate has been declining rapidly over the past year after touching 10.4% in March of the previous year. Analysts expect the headline UK inflation to drop further, from 3.4% in February to 3.1% in March, bringing it closer to the Bank of England's (BoE) target of 2%. The central bank is closely monitoring this release and may signal that interest rate cuts could happen sooner than anticipated. Current market expectations indicate a 60% probability of a 25 basis point cut at the BoE's meeting on August 1st. If the inflation rate continues to fall, this probability is likely to increase. The March UK inflation data will play a significant role in shaping the GBP's performance and influencing the BoE's monetary policy decisions in the coming months. As the US dollar strengthens and the British Pound (GBP) weakens, the GBP/USD currency pair's path of least resistance continues to trend lower. The recent break below all three simple moving averages on Wednesday has contributed to the negative market sentiment surrounding the GBP/USD. Furthermore, the pair has easily broken through previous support levels around 1.2547 and the significant psychological level of 1.2500. Technical analysis of the GBP/USD chart reveals the next two support levels at 1.2381 and 1.2303, which may be tested soon. Traders and investors closely monitor these key levels to gauge the GBP/USD's performance and potential trading opportunities in the current market environment, characterized by a robust US dollar and a weakening Sterling. GBP/USD Daily Price Chart IG Retail data shows 67.80% of traders are net-long with the ratio of traders long to short at 2.11 to 1.The number of traders' net long is 2.78% lower than yesterday and 35.65% higher than last week, while the number of traders' net short is 7.65% higher than yesterday and 31.33% lower than last week. We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests GBP/USD prices may continue to fall. See How Changes in IG Client Sentiment Can Help Your Trading Decisions What is your view on the British Pound – 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/gbp-usd-extends-losses-as-uk-labor-market-shows-signs-of-weakness-20240416.html

2024-04-15 23:15

Most Read: Market Sentiment Analysis and Outlook - Gold, WTI Crude Oil, S&P 500 Want to know where EUR/USD is headed over the coming months? Discover the answers in our quarterly forecast. Request your complimentary guide today! EUR/USD FORECAST – TECHNICAL ANALYSIS EUR/USD began the week on the back foot, slipping below support at 1.0635 and hitting its lowest level since early November of last year, with losses now exceeding 2.4% from April’s swing high. Confirmation of Monday's breakdown in the coming days may accelerate selling momentum, potentially paving the way for a descent toward the 2023 lows at 1.0450. On the other hand, if EUR/USD orchestrates a comeback and reclaims the 1.0635 threshold, resistance can be spotted near the 1.0700 psychological mark. On further strength, the focus will be on 1.0725. Bears must vigorously uphold this technical ceiling; any failure to do so might ignite a rally towards the 50-day and 200-day simple moving averages, hovering near 1.0820. EUR/USD PRICE ACTION CHART EUR/USD Chart Created Using TradingView USD/JPY FORECAST – TECHNICAL ANALYSIS USD/JPY soared on Monday, climbing past the 152.00 handle and hitting its highest level since June 1990, buoyed by rising U.S. Treasury yields. With bulls in control of the market, we could soon see a move towards channel resistance at 155.80; but gains could be temporary, as the Japanese government could step in to support the yen on a decisive break above the 155.00 threshold. Conversely, if bulls start taking profits on their long positions and USD/JPY pivots to the downside, support materializes at 153.20 and 152.00 thereafter. Prices could stabilize around this technical floor during a pullback, but in the event of a breakdown, bears could set their sights on 150.80, followed by 150.50, the 50-day simple moving average. USD/JPY PRICE ACTION CHART USD/JPY Chart Created Using TradingView Curious about what lies ahead for the British pound? Find key insights in our quarterly trading forecast. Claim your free copy now! GBP/USD FORECAST – TECHNICAL ANALYSIS GBP/USD experienced a slight decline on Monday but maintained its position above support at 1.2435. To bolster sentiment towards the pound, it's essential for this technical floor to remain intact; failure to prevent a breakdown could result in a pullback towards 1.2325. On further weakness, bears may feel emboldened to initiate an attack on the October 2023 lows around 1.2040. On the flip side, if sentiment shifts back in favor of buyers and cable manages to mount a bullish reversal, primary resistance emerges at 1.2525. Above this area, attention will be on the 200-day simple moving average at 1.2580, followed by 1.2650, where the 50-day simple moving average intersects with two important short-term trendlines. GBP/USD PRICE ACTION CHART GBP/USD Chart Created Using TradingView https://www.dailyfx.com/news/forex-usd-dollar-s-outlook-brightens-setups-on-eur-usd-usd-jpy-gbp-usd-20240415.html

2024-04-15 13:39

USD/JPY Analysis The Japanese Finance Minister Suzuki seeks to be ‘fully prepared’ regarding FX moves USD/JPY continues into the danger zone, approaching 155.00 Get your hands on the Japanese Yen Q2 outlook today for exclusive insights into key market catalysts that should be on every trader's radar: Japanese Finance Minister Suzuki Seeks to be ‘Fully Prepared’ Regarding FX Moves A simple, equal weighted index measuring the performance of the Japanese yen revealed a broad decline in the currency versus a basket of major currencies. The yen got the week off to a bad start, eliciting a response form the Japanese Finance Minister Suzuki. Mr Suzuki mentioned, “I want to be fully prepared” regarding forex moves and is closely monitoring forex moves. Previously, Japan’s former currency official Watanabe mentioned that authorities are more likely to consider FX intervention at a level of 155.00 on USD/JPY. Officials have mentioned many times that they are not targeting specific levels but instead monitor undesirable, volatile moves (depreciation). Japanese Yen Index (Equal Weighting of GBP/JPY, USD/JPY, EUR/JPY and AUD/JPY)) Source: TradingView, prepared by Richard Snow USD/JPY Continues into the Danger Zone, Approaching Crucial 155.00 Level USD/JPY accelerated closer to the 155.00 level at the start of the week as the dollar remains at elevated levels. 152.00 was initially the line that the market dared not cross but the high-flying greenback pushed the boundary until markets felt comfortable above the 152.00. Traders appear to have become emboldened by the lack of urgency in communication out of Tokyo and continue to bid the pair higher still. The RSI reveals that the pair trades well within overbought territory and shows few to no signs of moderating. Long trades from here present an unfavourable risk-to-reward ratio, considering the warning issued by the former currency official Watanabe about 155.00 potentially being the tripwire for a major response (FX intervention). 155.00 appears as stern resistance with 152.00 and 150 representing levels that could come into plat at a moment’s notice if Tokyo feels it is necessary to take action. Thereafter, 146.50 comes into view. USD/JPY Daily Chart Source: TradingView, prepared by Richard Snow https://www.dailyfx.com/news/usd-jpy-price-outlook-yen-weakness-gathers-pace-teasing-fx-intervention-20240415.html

2024-04-15 11:30

Bitcoin (BTC), Ethereum (ETH) - Prices, Charts, and Analysis: Spot BTC and ETH ETFs in Hong Kong are imminent, according to sources. Bitcoin halving is set for this week. Prices rebound after heavy weekend sell-off. Bitcoin and Ethereum are pushing higher in early European turnover on rumored news that the Hong Kong Securities and Exchange Commission has given the green light to multiple applicants for spot BTC and ETH exchange-traded funds (ETFs). China Asset Management (HK) Ltd, one of the companies seeking approval, put out an announcement on its website earlier today: https://www.chinaamc.com.hk/wp-content/uploads/2024/04/ChinaAMC-HK-Joins-Forces-with-Partners-to-Launch-Spot-Bitcoin-and-Ethereum-ETFs.pdf However, at the time of writing, there has been no official comment on any approval stories, or announcements, by the HK SEC. While the HK media stories are grabbing market attention today, the Bitcoin halving event will dominate headlines later this week. According to the latest mining data, there are 683 blocks left to be mined before mining rewards are cut by 50%. The estimated halving date is seen early morning on Saturday 20th. Bitcoin Halving Event The cryptocurrency was hit hard over the weekend after Iran carried out a series of strikes against Israeli territory. The attack, in response to Israel’s attack on Iran’s consulate in Syria at the start of the month, saw in excess of 350 drones and missiles launched by Iran. According to the Israel Defence Force (IDF), ‘99%’ of these ‘threats’ were successfully intercepted. With the cryptocurrency sector being the only market open over the weekend, traders used the sector’s liquidity to hedge risk. Bitcoin hit a low of $60.6k as news of the impending strike filtered through, while Ethereum hit a multi-week low of $2,845. In the altcoin space, losses of 25% or more were seen, sparking multiple liquidation stories. Prices across the board are pushing higher today, but the weekend’s losses will take some time to fully recover. The weekend sell-off saw Bitcoin fall below both the 20- and 50-day simple moving averages for the first time since late January. Both of these will need to be recovered convincingly, along with a prior resistance-turned-support level at $69k, before Bitcoin can make a fresh attempt at the mid-March $73.78k all-time high. Bitcoin Daily Price Chart – April 15th, 2024 Learn how to trade cryptocurrencies with our complimentary guide Ethereum is over 3% higher today after making a multi-month low of $2,845 on Saturday. Ethereum must reclaim both the 20- and 50-day moving averages before $ 3,582 comes back into play. Above here, the April 8th/9th double high at $3,728 comes into focus. Ethereum Daily Price Chart – April 15th, 2024 All charts via TradingView What is your view on Bitcoin and Ethereum – bullish or bearish?? 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/bitcoin-btc-ethereum-eth-rally-on-hong-kong-spot-etf-approval-rumors-20240415.html

2024-04-15 10:00

FTSE 100, DAX 40, Nasdaq 100 - Analysis and Charts FTSE 100 consolidates below its record high On Friday the FTSE 100 briefly revisited its February 2023 record high, made close to the 8,050 mark, before giving back its intraday gains. It nonetheless remained above its March-to-April uptrend line at 7,911 which continues to underpin. While this is the case, the psychological 8,000 mark will remain in sight, together with the 8,017 early April peak. Below the uptrend line support can be spotted at last week’s 7,886 low and also at the previous week’s 7,856 low. FTSE 100 Daily Chart DAX 40 regains lost ground The DAX 40 slid to a one-month low on Friday, voiding Thursday’s bullish hammer formation on the daily candlestick chart, on fears that the situation in the Middle East could escalate. Saturday’s attack on Israel by Iran has proved these fears to be justified but hope that the former will show restraint has led to a minor recovery in the index on Monday morning. While last week’s low at 17,831 holds, there remains a possibility for the DAX 40 index to regain some of the last couple of weeks’ 4% losses. A rise above Friday’s 18,165 high would technically confirm the resumption of the medium-term uptrend. Failure at 17,831 would put the early March low at 17,619 on the cards. DAX 40 Daily Chart Nasdaq 100 trades in high volatility sideways trading range The Nasdaq 100’s sharp fall to 17,950 on Friday following a swift advance to 18,337 on Thursday means that US earnings season at a time of escalating tensions in the Middle East provides lots of volatility with Q1 earnings by the likes of Goldman Sachs, Bank of America and Netflix likely to keep volatility elevated for this week. While the current April lows at 17,866 to 17,862 underpin, further sideways trading with an upside bias remains at hand with last week’s high at 18,337 representing a possible upside target. Nasdaq 100 Daily Chart https://www.dailyfx.com/news/ftse-100-dax-40-and-nasdaq-100-begin-week-on-cautious-footing-20240415.html