Analys från DailyFX

USD Weakness Pauses After FOMC Rate Hike, Clear Resistance in Focus

Published

7 år ago

14 juni, 2017

DailyFX

Will Dollar weakness persist for the rest of 2017? Get a free DFX Q2 market forecast here

Talking Points:

DXY Technical Strategy: DXY remains in “sell the rips” mode
Fed Hikes Rates as Expected – US Dollar Shrugs
EUR strength expected to continueper sentiment making DXY gains tough to come by

The Federal Open Market Committee went forward with the priced-in rate hike on Wednesday. What likely surprised markets most was that the Fed looked through the recent weakness in economic data to keep the terminal rate expected at 3% per the Fed’s Dot Plot. Aggressive price action was not seen following the Fed’s decision to hike. USD initially dropped on the headlines, which added to the morning’s losses after a miss in retail sales and inflation data.

A bit more concerning development through the week is the falling yields, which could indicate that further USD weakness is on the horizon. After Wednesday morning’s weak data print, the Citi Economic Surprise Index for the US Economy was at its lowest levels since May 2015, which is why many were surprised the Fed stood pat and kept their forecasts for future rate hikes firm. However, it is worth noting that the Fed could be looking to get the rate as far from zero as possible as a flattening yield curve often signals upcoming economic slowdown. Should that eventually come to pass, the Fed would likely want to be able to cut as much as possible to re-stimulate the economy.

Looking at the chart, there is a clear zone of resistance that prevents me from changing the bearish outlook on DXY. The recent lower highs of 97.53/78 acts as resistance and an inability for the price to strengthen above this zone on a closing basis would cause me to anticipate and an eventual move to the downside extension targets of 95.85-94.83 at which point, we would move down the resistance point that would turn me from bearish to neutral.

Also, when looking at IG Client Sentiment, EUR strength is expected to continue per sentiment showing that retail traders continue to cut back on long exposure and grow net-short exposure.

If you would be interested in seeing how retail traders’ are bettingin key markets, see IG Client Sentiment here!

Join Tyler in his Daily Closing Bell webinars at 3 pm ET to discuss this market.

DXY trading below 97.53/78 keeps focus on downside extension targets @ 95.85-94.83

Chart Created by Tyler Yell, CMT

IG Client Sentiment Highlight: EUR (57.6% of DXY) Sentiment favors further upside

EURUSD: Retail trader data shows 22.5% of traders are net-long with the ratio of traders short to long at 3.45 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.05975; price has moved 6.4% higher since then. The number of traders net-long is 26.4% lower than yesterday and 25.5% lower from last week, while the number of traders net-short is 2.4% higher than yesterday and 5.2% higher from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger EURUSD-bullish contrarian trading bias. (Emphasis mine)

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Shorter-Term DXY Technical Levels: Wednesday, June 14, 2017

For those interested in shorter-term levels of focus than the ones above, these levels signal important potential pivot levels over the next 48-hours.

USD Weakness Pauses After FOMC Rate Hike, Clear Resistance in Focus

Written by Tyler Yell, CMT, Currency Analyst Trading Instructor for DailyFX.com

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Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

7 år ago

30 september, 2017

DailyFX

What’s inside:

EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
Resistance in vicinity of 11825/80 likely to keep a lid on further strength
Targeting the low to mid-11600s with more selling

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Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.

Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.

Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).

Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.

For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.

EURUSD: Daily

—Written by Paul Robinson, Market Analyst

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You can follow Paul on Twitter at@PaulRobinonFX.

Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

7 år ago

29 september, 2017

DailyFX

Euro Bias Mixed Heading into October, Q4'17

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

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Analys från DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Published

7 år ago

29 september, 2017

DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form