2024-04-08 14:12

RBNZ, AUD, NZD Analysis RBNZ expected to keep OCR unchanged as inflation remains stubbornly high NZD/USD pullback meets its first challenge Aussie tests major resistance after phenomenal run vs the Kiwi Get your hands on the AUD Q2 outlook today for exclusive insights into key market catalysts that should be on every trader's radar: RBNZ Expected to Keep the Official Cash Rate Unchanged In the early hours of Wednesday morning the RBNZ is likely to announce no change to the official cash rate (OCR). In fact, as early at February this year, the RBNZ were still discussing rate hikes in the face of hot underlying inflation. Currently, markets assign a mere 4% chance of a rate cut meaning interest rates are going to have to remain higher for longer until inflation expectations drop. New Zealand is currently experiencing disinflation – as confirmed by Governor Orr after the February meeting – but more work needs to be done. The RBNZ previously stated that they have an asymmetric risk function (will prioritize inflation risks) and admitted that the economy has limited capacity to absorb further upside inflation surprises. New Zealand Core Inflation Rate (Year-on-year) Source: Tradingeconomics, prepared by Richard Snow NZD/USD Pullback Meets its First Challenge The NZD/USD decline found support at 0.5930, rising above 0.5915 (a major long-term pivot point) and now has 0.6050 in sight. The Kiwi dollar has struggled to achieve upside momentum as the US dollar appears to have a floor underneath it in the form of hotter US data. While the Kiwi dollar boasts a slightly better interest rate differential, it has not managed to get one over the greenback. Kiwi bulls now face 0.6050 and the 200-day simple moving average if the bullish directional move has the legs to extend further. Support comes in at 0.5915. NZD/USD Daily Chart Source: TradingView, prepared by Richard Snow Aussie Tests Major Resistance After Phenomenal Run vs the Kiwi The Aussie dollar has enjoyed a prolonged stint of gains against the Kiwi dollar which is showing signs of potential fatigue ahead of long-term resistance which connects the highs going all the way back to early 2023. The Australian dollar has not performed as well against major currencies, suffering to some degree due to its proximity to and reliance on China. AUD has struggled to maintain it’s former correlation to the S&P 500 which has enjoyed an impressive risk rally up until the end of last week. AUD/NZD Weekly Chart Source: TradingView, prepared by Richard Snow Stay up to date with the latest breaking news and themes driving the market by signing up to our weekly newsletter: https://www.dailyfx.com/news/kiwi-and-aussie-outlook-ahead-of-the-rbnz-meeting-20240408.html

2024-04-08 12:30

Bitcoin (BTC), Coinbase (COIN) - Prices, Charts, and Analysis: Bitcoin is set to print a new all-time high, possibly this week. Bitcoin halving event expected on April 19th. Coinbase is benefitting from a buoyant cryptocurrency market. See our brand new Q2 Technical and Fundamental Bitcoin Report Bitcoin is back above $70k and is within touching distance of posting a new all-time high as buyers become increasingly active ahead of the upcoming halving event. The recent, short-term, sell-off has now been fully retraced with today’s move taking Bitcoin back above a cluster of recent highs between $71.2k and $71.8k. There is little in the way of technical resistance before BTC/USD enters unchartered territory. The driver of Bitcoin’s robust rally over the last few months has been heavy institutional buying after eleven spot Bitcoin ETFs were approved in early January. In the first quarter of 2024, these eleven ETFs bought a net $12.1 billion worth of Bitcoin - $26.8 billion inflows vs. $14.7 billion outflows. Investopedia/BitMEX Research This heavy demand will soon run into a supply shock as the number of new Bitcoins mined will be reduced by 50% at the new halving event. These halving events occur every four years when the reward for mining a new block gets reduced from 6.25 BTC to 3.125 BTC per block. Bitcoin halving will continue every 210,000 blocks until all 21 million coins have been mined, predicted in 2040. Via IG.Com Bitcoin Halving Event Bitcoin (BTC) Daily Price Chart Coinbase (COIN), the largest cryptocurrency exchange in the US, is one company that benefits from renewed activity in the cryptocurrency space. Despite being involved in an ongoing lawsuit with the US Securities and Exchange Commission (SEC), Coinbase has seen its share price more than double since early February. The weekly chart shows Coinbase tested and rejected the 61.8% Fibonacci retracement level at $277 in late March and this level could soon come under pressure again unless the SEC case stymies further progress. Above here the 78.6% retracement level at $344 comes into view. Coinbase (COIN) Weekly Price Chart All Charts via TradingView What is your view on Bitcoin or Coinbase – 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-nears-new-all-time-high-as-halving-event-looms-coinbase-coin-benefits-20240408.html

2024-04-08 11:04

Oil (Brent, WTI) News and Analysis Israel removes troops from Southern Gaza as peace talks got underway in Egypt Brent crude oil gaps lower after Israel removes troops from Southern Gaza WTI eyes overbought conditions as the commodity eases on Monday Get your hands on the Oil Q2 outlook today for exclusive insights into key market catalysts that should be on every trader's radar: Israeli Troops Pulled out of Southern of Gaza as Peace Talks Got Under Way Israeli soldiers have been called back from Southern Israel after sparking outrage over the recent aggression that killed seven aid workers. The US sent a particularly strong message that civilians need to be protected and that Israel needs to allow more aid into the besieged territory. Hammas insist on a full withdrawal of IDF soldiers, something Israel in not prepared to facilitate, and it is not yet known whether the partial withdrawal of soldiers is some sort of compromise ahead of peace talks or a way to appease global outrage. Either way, the slight de-escalation has been seen as a step in the right direction to allow much needed aid to find its way to civilians in need. However, the potential for a broader conflict has risen since the April 1st attack on an Iranian embassy in Syria which killed senior Iranian commanders. Risk sentiment remains on edge after Iran warned of an ‘inevitable’ retaliation. Brent crude oil gaps lower as tensions appear to ease at the start of the week Brent crude oil broke above the longer-term ascending channel, heading well above the $90 marker, finding resistance near $91.42. Prices gapped lower at the start of trading week as tensions eased but stull remain elevated. A hold above the upward sloping trendline (former resistance) appears as the most immediate test for oil bulls. Prices dropped below $89 intra-day but have recovered from the daily low. A bullish bias remains constructive as long as prices remain above $85. However, on a more short-term basis, overbought territory on the RSI poses a challenge for bulls in the shorter-term. Lastly, more evidence of a pullback from here emerges via the bounce at the 38.2% retracement of the 2020-2022 major rise. Brent Crude Daily Chart Source: TradingView, prepared by Richard Snow WTI Eyes Overbought Conditions as the Commodity Eases on Monday WTI trades in a similar fashion to Brent crude oil, heading lower at the start of the week after breaching into overbought territory. The move lower is already showing signs of restraint as the daily candle reveals a long lower wick but it will be important to wait for the candle close before confirming such a suspicion. Further bearish signals would include the RSI recovering from overbought territory and a close back within the ascending channel. A bullish crossover will help bulls maintain a bullish bias but keep in mind the moving averages are inherently lagged in nature. WTI Daily Chart Source: TradingView, prepared by Richard Snow https://www.dailyfx.com/news/oil-price-update-israeli-troops-withdraw-from-the-south-peace-talks-underway-20240408.html

2024-04-08 08:04

US Dollar and Gold Prices and Analysis • US Treasury yields back at multi-month highs. • US CPI and the latest FOMC minutes will drive the greenback’s next move. • Gold driven higher by haven buying. For all major central bank meeting dates, see the DailyFX Central Bank Calendar The US dollar remains better bid in early European trade, underpinned by higher US Treasury yields. Last Friday’s strong NFPs – 303k vs. 200k expectations – helped to trim market expectations of a June rate cut. Financial markets have for weeks been pricing in a cut by the FOMC on June 12th, but this is now seen as a coin toss as expectations are pared back further. US Treasury yields rose after the Jobs Report and are building on Friday’s gains. The interest-rate sensitive US 2-yr now yields 4.77% and is within a couple of basis points of highs last seen in mid-November, while the benchmark US 10-yr has broken above a range of resistance and is trading at a multi-month high of 4.475%. US NFPs Trump Expectations, US Dollar Grabs a Bid, Gold Slips But Retains Haven Support 10-Yr US Treasury Yield Daily Chart US dollar drivers this week include Core inflation (March) and the latest FOMC minutes, both released on Wednesday. The US dollar index is currently sitting on the 38.2% Fibonacci retracement level around 104.35 and is supported by a cluster of three simple moving averages. These SMAs supported the index last Thursday and a bullish 50-day/200-day crossover made in late March provides additional support to the move higher. The Golden Cross - What Is It And How To Identify It When Trading US Dollar Index Daily Chart Gold Price Weekly Forecast – Fresh Record Highs on Heightened Israel/Iran Fears Gold continues to print fresh record highs as geopolitical fears fuel a strong haven bid. Escalating tensions between Israel and Iran have pushed gold to fresh record highs in recent days and with the situation between the two countries unlikely to be resolved shortly, gold will remain in demand. Gold Daily Price Chart All Charts via TradingView Retail trader data shows 42.79% of traders are net-long with the ratio of traders short to long at 1.34 to 1. The number of traders net-long is 0.49% higher than yesterday and 0.93% lower than last week, while the number of traders net-short is 2.35% lower than yesterday and 1.91% higher from last week. We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests Gold prices may continue to rise. 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-grabs-an-early-bid-rate-cut-now-seen-as-50-50-gold-rallies-further-20240408.html

2024-04-07 17:00

The week ahead presents many ‘high importance’ risk events ranging from US CPI data to central bank decisions in Canada, New Zealand and the European Union. The FOMC minutes of the March meeting will also provide more insight on Fed thinking, although, the trend of hotter US data may diminish the impact of what was discussed during the March meeting. US Dollar (DXY) in Focus Ahead of CPI Data, NFP Boost Proved Short-Lived Friday’s hotter-than-expected jobs data for March initially sent the dollar higher but the catalyst failed to hold into the close. US CPI data will definitely draw a huge focus from the market due to the stubborn PCE figures and generally robust US data that may delay rate cuts even further. US Dollar Basket (DXY) Daily Chart Source: TradingView, prepared by Richard Snow The Risk of a Broader Conflict in the Middle East Triggered Gold’s Safe Haven Push Gold has gone from strength to strength despite rising US yields. The greenback (DXY) registered a minor decline last week but US 2-year and 10-year treasury yields rose for the week. The prospect of rates remaining on hold for longer, has the potential to see more hawkish repricing for treasuries that increases the opportunity cost of holding the non-interest bearing commodity. Recent escalations in eastern Europe and the Middle East raise the allure of gold due to its safe haven properties but the market has returned to massively overbought territory, hinting at a potential cooling off period at the start of the week in the absence of further escalation. Gold (XAU/USD) Daily Chart Source: TradingView, prepared by Richard Snow TECHNICAL AND FUNDAMENTAL FORECASTS – W/C April 8 US Dollar’s Outlook Rides on US Inflation Data - EUR/USD, USD/JPY, GBP/USD The U.S. dollar lost ground this past week, but the tide could turn back in its favor in the coming days, especially if Wednesday's U.S. inflation report surprises to the upside and triggers a hawkish repricing of interest rate expectations. Gold Price Weekly Forecast – Fresh Record Highs on Heightened Israel/Iran Fears Gold is pressing further into record high territory as escalating tensions between Israel and Iran continue to fuel the precious metal’s safe-haven bid. Euro Forecast: April ECB Meeting Likely to be a Prelude for a June Cut The euro recovers ahead of the ECB meeting which is likely to point to June for that first rate cut. Encouraging sentiment data and soft inflation provide conflicting dynamics British Pound Weekly Forecast: Lack of Data Will Leave USD in Charge The British Pound heads into a new trading week under pressure against the United States Dollar as once-reliable monetary-policy support continues to ebb. https://www.dailyfx.com/news/markets-week-ahead-gold-us-dollar-euro-pound-sterling-20240407.html

2024-04-07 06:00

US DOLLAR FORECAST – EUR/USD, USD/JPY, GBP/USD The U.S. dollar finishes the week moderately lower, easing off multi-month highs All eyes will on the March U.S. inflation report in the week ahead This article discusses the technical outlook for EUR/USD, USD/JPY and GBP/USD Most Read: USD/JPY Tiptoes Towards Bullish Breakout after Strong US Jobs Data. What Now? The U.S. dollar, as measured by the DXY index, lost ground over the past five trading sessions, marking the end of a three-week winning streak that had propelled prices to 5-month highs by Tuesday. When all was said and done, the DXY retreated 0.24% to settle at 104.28, with the euro's strength being the primary factor behind this movement. Despite this subdued performance, the greenback should not be written off just yet, as it may be able to restart its advance and regain momentum soon, especially if the March U.S. inflation report, due for release on Wednesday, beats projections and confirms Wall Street’s worst nightmare: progress on disinflation has hit a roadblock. Consensus estimates suggest headline CPI climbed 0.3% on a seasonally adjusted basis last month, lifting the annual rate to 3.4% from 3.2% previously. The core gauge is also seen rising 0.3% month-on-month, but the 12-month reading is projected to have slowed to 3.7% from 3.8% in February, a positive but tiny step in the right direction. RECENT FEDSPEAK Fed Chair Powell, in a speech at the Stanford Business, Government, and Society Forum earlier this week, stated that nothing has changed for the FOMC in terms of its policy outlook outlined in the latest Summary of Economic Projections, signaling that 75 basis points of easing remains on the table for the year. His comments appeared to deflate the U.S. dollar as we moved towards the latter part of the week. Although Powell is the most important voice at the Federal Reserve, other officials are beginning to express reservations about committing to a preset course. Fed Governor Michelle Bowman, for instance, has indicated that headway in disinflation efforts has stalled and that she wouldn’t be comfortable cutting rates until renewed price pressures abate. She also mentioned that hiking rates again is possible, though not likely. Fed Dallas President Lorie Logan also seemed to have embraced a more aggressive posture, emphasizing that it's too early to consider easing measures. In support of her viewpoint, she cited hotter-than-expected CPI readings lately and signs that elevated borrowing costs may not be restraining aggregate demand as much as originally thought. All things considered, if the inflation outlook continues to evolve unfavorably, the U.S. central bank may have no other choice but to start coalescing around a more hawkish position, with the robustness of the labor market giving policymakers plenty of wiggle room to be patient before pivoting to a looser stance. This could mean delayed interest rate reductions and shallow cuts this year once the process finally gets underway. The following table shows the probabilities of Fed action at various FOMC meetings. Source: CME Group In light of the aforementioned points, traders should closely watch the upcoming inflation numbers and brace for volatility. That said, an upside surprise in the data, particularly in the core metric, could reinforce the upswing in U.S. Treasury yields seen in the first days of April, allowing the U.S. dollar to resume its upward journey and command leadership in the FX space. Meanwhile, a lower-than-anticipated print on the all-items and core indices could have the opposite effects on markets, resulting in lower government rates and a softer U.S. dollar. However, for this scenario to play out, the divergence of the final data from expectations would need to be substantial; otherwise, the impact on bonds and the U.S. currency would be more measured. EUR/USD TECHNICAL ANALYSIS EUR/USD dipped to multi-week lows at the start of the week, only to rebound from trendline support around 1.0725, with this bounce propelling prices above both the 50-day and 200-day simple moving averages. Should the pair build upon its recent recovery over the coming sessions, Fibonacci resistance emerges at 1.0865. On further strength, all eyes will be on 1.0915. Alternatively, should sellers regain control and drive prices below the key moving averages mentioned earlier, a retreat towards 1.0840 might ensue. Bulls must vigorously defend this technical floor; a failure to do so might exacerbate negative sentiment towards the euro, potentially triggering a drop towards the 1.0700 handle. Below this area, attention should gravitate towards 1.0625. EUR/USD PRICE ACTION CHART EUR/USD Chart Created Using TradingView USD/JPY TECHNICAL ANALYSIS USD/JPY has exhibited range-bound behavior over the past two weeks, oscillating between resistance near 152.00 and support at 150.90. This suggests a consolidation period is underway. With that in mind, traders should be on the lookout for either a breakout (152.00) or a breakdown at (150.90) for guidance on the near-term outlook. In the event of bullish breakout, a rally towards the upper boundary of a short-term ascending channel at 155.25 may follow, provided Tokyo stays on the sidelines and refrains from intervening in the FX space to support the yen. Conversely, in case of a breakdown, sellers could begin to trickle back into the market, setting the stage for a drop towards 149.75 (50-day SMA), followed by 148.85. USD/JPY PRICE ACTION CHART USD/JPY Chart Created Using TradingView GBP/USD TECHNICAL ANALYSIS GBP/USD fell early in the week but bounced back in the following days, ultimately reclaiming its 200-day SMA. However, the upward impulse faded when prices failed to clear cluster resistance at 1.2670, near the intersection of three key trendlines. Traders should monitor this area closely, keeping in mind that a bearish rejection could send cable tumbling back towards 1.2590 and possibly even 1.2520. On the other hand, if the bulls succeed in pushing the exchange rate above 1.2670 in a decisive fashion, buying interest could pick up traction in the upcoming trading sessions, fostering conditions for a potential climb towards the 1.2800 handle. Further upside progression beyond this juncture could open the door to a retest of last month's high in the vicinity of 1.2895. GBP/USD PRICE ACTION CHART GBP/USD Chart Created Using TradingView https://www.dailyfx.com/news/forex-us-dollar-s-outlook-rides-on-us-inflation-data-eur-usd-usd-jpy-gbp-usd-20240407.html