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DXY Weekly Forecast | 15th May 2023Fundamental Backdrop Core Retail Sales m/m expected to improve from -0.8% to 0.5% Consumer spending will increase significantly, indicating improved economic activity Unemployment Claims data could be better than expected due to positive CPI and PPI data released last week Friday could be more volatile due to Fed Chair Powell's speech Powell expected to address rising market concern about US debt ceiling Technical Confluences Near term resistance at 102.800 Next resistance at 103.500 Idea With the DXY expected the strengthen in the short term, we could see price head towards the 103.500 level. NOT FINANCIAL ADVICE DISCLAIMER The trading related ideas posted by OlympusLabs are for educational and informational purposes only and should not be considered as financial advice. Trading in financial markets involves a high degree of risk, and individuals should carefully consider their investment objectives, financial situation, and risk tolerance before making any trading decisions based on our ideas. We are not a licensed financial advisor or professional, and the information we are providing is based on our personal experience and research. We make no guarantees or promises regarding the accuracy, completeness, or reliability of the information provided, and users should do their own research and analysis before making any trades. Users should be aware that trading involves significant risk, and there is no guarantee of profit. Any trading strategy may result in losses, and individuals should be prepared to accept those risks. OlympusLabs and its affiliates are not responsible for any losses or damages that may result from the use of our trading related ideas or the information provided on our platform. Users should seek the advice of a licensed financial advisor or professional if they have any doubts or concerns about their investment strategies.
TVC:DXYLong
by OlympusLab
EUR/USD edges lower, ECB expected to raise ratesEUR/USD is trading quietly on Thursday, ahead of the ECB decision later today. All eyes are the ECB, which is expected to raise rates at today's meeting. The burning question remains will the central bank increase rates by 25 or 50 basis points? The eurozone April inflation report, published Tuesday, didn't provide any insights as both the headline and core readings barely moved and were very close to the estimates. Headline CPI came in at 7.0% and the core rate at 5.6%, which is well above the 2% target and much too high for the ECB. The Bank has been aggressive in its rate-tightening cycle and raised rates by 50 bp in March. Another 50-bp increase would help in the fight against inflation but also raise the likelihood of a recession due to the economy slowing down too abruptly. The markets are leaning closer to a 25-bp hike (80% probability) over a 50-bp increase (20% probability). The Federal Reserve raised rates by 25 bp on Wednesday, to the surprise of no one. Investors were more interested in what is coming next, and Jerome Powell did hint that this hike would be the final one after 10 straight rate hikes. The rate statement was somewhat dovish, with the Fed removing the phrase "some additional" rate hikes might be needed. It changed the language that said that it would examine various factors in "determining the extent" that further hikes would be needed. Powell sounded more hawkish in the press conference, saying that higher interest rates had not sufficiently slowed down the economy, the labour market or inflation. Just to be crystal clear, Powell said that “inflation pressures continue to run high, and the process of getting inflation back down to 2% has a long way to go". A rate cut, anyone? Powell said in his remarks that the inflation outlook does not support a rate cut. The markets disagree and have priced in an 81% rate cut in September (51% chance of 25-bp cut and 30% of 50-bp cut). Inflation is on its way down, but the pace of the deceleration could well determine if the Fed trims rates before the end of the year. EUR/USD tested resistance at 1.1088 earlier. The next resistance line is 1.1157 1.1025 and 1.0956 are providing support
by OANDA
Has The U.S. Dollar DXY Peaked In 2023?After steadily climbing throughout 2021, the DXY saw a solid start to 2022. The US Dollar Index rallied from a low point of 94.63 in mid-January to a 20-year high of just over 114 in late September. DXY has experienced a significant drop since the publication of cooler-than-expected inflation data. Expectations of slower rate hikes from the Fed, and a lower potential terminal rate for US interest rates, have resulted in a repositioned dollar. I believe the USD will weaken further in 2023, as its significant overvaluation (based on the real effective exchange rate (REER)) can no longer be supported, once the Fed stops hiking, global growth shows signs of toughing and market volatility comes down. Technically, the dollar index DXY on the monthly timeframe closed below the 21-EMA for the first time since Aug. 2021, below the critical resistance represented in 102.80 level. Next downside target: 99.35 support level. (on the medium-to-long term)
TVC:DXYShort
by AlyaAkram
US Inflation Slows for Ninth Month: What's the Plan, Jay Powell?The US annual inflation rate has slowed down for the ninth month in a row, hitting 5% in March of 2023. While this is the lowest it's been since May of 2021, it's still well above the Fed's target of 2%. Investors are trying to figure out when the central bank will put the brakes on its hiking campaign to slow inflation. The March FOMC minutes (released this morning) revealed that some Federal Reserve policymakers discussed hitting the pause button on interest rate increases, following the collapse of two regional banks. However, ultimately, all policymakers decided that tackling high inflation was still the top priority. In the end, they went ahead with a rate hike, despite the potential risks Complicating matters, core CPI (which excludes food and energy components) has gone up to 5.6%, after rising by 5.5% in February. This has led some people to believe that more tightening is in the cards. Initially, money markets thought that the Fed might not raise interest rates in May, but expectations have since risen to 70.5%. The Dollar index remains at its lowest since February 2nd, steady near 101.5. As for Canada, things are looking up - the Bank of Canada has left its key overnight interest rate on hold at 4.50% as expected, while curbing language warning of a potential recession. The Canadian dollar has responded positively, inching up to around 1.34 per USD. Meanwhile, the British pound has risen towards $1.25, nearing a ten-month high of $1.2525 that was touched on April 4. Bank of England Governor Andrew Bailey has stated that he doesn't see any signs of a repeat of the 2007/8 global financial crisis, which is reassuring news for investors. They're betting that the Bank of England will continue to raise interest rates to combat inflation, adding some fuel to the GBP.
TVC:DXY
by BlackBull_Markets
#BOND crisis to fuel monetary expansion The Fed is damned by inflation if they print, damned by bank runs if they dont print. And with recession on the way, history shows we could plumb to new lows if the Fed only prints enough to backstop banks and pensions. Early 2000s and early 1930s were two such cases where the Fed aggressively lowered rates for well over 18 months but markets continued to trend lower anyway. But 2008 ushered in central bank quantitative easing, so with QE at the Fed's disposal, it is more likely the growth of M2 will accelerate which will keep inflation stubbornly high if not higher. A new factor that wasn't present before is that we have increasing M2 from China and Japan which has been a large driver of the market bounce we've seen in stocks and crypto since the start of the year. The 2-yr and 10-yr rates are heading lower in a hurry. CME Fed futures currently predicts one more 25 bps hike to a terminal rate of 500-525 then three consecutive drops of 25 bps. Higher inflation would become the standard as the Fed would be forced to accept a higher inflation target well above 2% which Ray Dalio had predicted in one of his published pieces.
FRED:WALCL
by BallaJi
US100 awaiting POWEL speechThe calm before the storm Meanwhile, the market is waiting for what the heck he's going to say, a gold spot for trading has been created. No matter what Powell states, the price will move in one direction or another. Enjoy trading safely. Use always SL Don't bet more than 1% of your balance. Your money is finite, but the chances of making millions are Billions. Note: the trades are triggered once the price crosses the channel boundaries, thru pending orders. This is not a financial adv!
FX:NAS100
by Mat_cl
Is the DXY in trouble!?? Before we start all views are my own and are based from my overall personal research. As we have covered in previous markups and breakdowns we are taking our major lows on the larger timeframes on the DXY. Here we have a pretty simply markup here for DXY iam only looking at this for a short term idea overall i strongly believe we are set for some serious downside on the USD and with this iam waiting for a true shift to show itself... As many countries begin to decouple from the USD and the fed continues pushing the price to unsustainable levels with consistent printing of new currency we are watching history unfold in front of our eyes... Taking a deeper look into the history & future of the USD. The control and power that the US has had in the past is drastically dwindling... if you follow the power trial to its source it will and always has lead us back to the federal reserve. Now the above is an issue for many different reasons... the main reason being no country or persons should be governed or controlled by a bank or reserve, which for a long time has been the case... this leading to countries having economic collapses along with huge depts placed on them in times of crisis, when this happens to a country it 90% of the time means one side is gaining while the other is losing. due to this we are and will continue to see more countries disconnect and distance themselves from the USD. Once we get to our tipping point where the USD has truly lost its grip on the global economy it will be to late to revert from its course, which i believe will take us to lows we've not seen in decades, ultimately leading to the collapse of the USD... Now iam no economist nor a financial expert, but I urge everyone that reads this to do your own research to the state of the USD and how the fed is "dealing" with the matter. To sum up, iam looking for prices to drop below 100 on the DXY in the coming months and possibly even weeks... Whatever the outcome trader stay safe and stick to your plan!
TVC:DXYShort
by PipSurfingSociety
Great down day for $SPY (+25% return)Shorted $AAPL at close to yesterday's high ($155-156) for a close to 25%+ gain with SPY being down -1.53% today. What comes next? 1/ TESTIMONY DAY 1 $DXY ripped through the supply zone during Powell's testimony. $SPY bulls will want to see DXY make it back in the zone for SPY to move 401+ which has acted as near-term resistance (anything goes when it comes to Powell). 2/ POSITIONING UPDATE Still holding my swing position for $AAPL (see previous linked idea). I expect more drawdown before I consider trimming,
AMEX:SPY
by gigavest
Swissie rally fizzles, SNB's Jordan up nextUSD/CHF has rebounded on Tuesday, ending a rally that saw the Swiss franc climb over 1%. In the European session, USD/CHF is trading at 0.9344, up 0.40%. Switzerland released the February inflation report on Monday and the reading was higher than expected. CPI rose 0.7% m/m, up from 0.6% in February and above the 0.4% forecast. On an annualized basis, CPI climbed 3.4%, edging up from 3.3% and higher than the forecast of 3.1%. These inflation numbers would be a dream come true for most major central banks, which are struggling with inflation levels two or three times higher. Still, the Swiss National Bank is concerned about high inflation, as its target is 0-2%. The SNB was widely expected to raise rate by 50 basis points at the rate meeting on March 23 and the uptick in February inflation cements the likelihood of such a move. Swiss National Bank Chair Jordan will make an appearance later today and is likely to address the rise in inflation. The SNB does not provide forward guidance for its rate policy, but the central bank has projected an inflation rate of 2.4% for 2023. With the cash rate currently at 1%, it's a safe bet that we'll see another hike in June of either 25 or 50 basis points. The continuing tightening should provide a boost to the Swiss franc, but traders should keep in mind that the SNB has not hesitated to intervene in the foreign exchange market when the Swiss franc became too strong for its liking. In the US, Federal Reserve Chair Powell will be in the spotlight as he testifies before a Senate committee later today. The Fed has remained hawkish and after a host of strong January releases, the markets have shifted their expectations closer to the Fed's stance. It was only a few weeks ago that the markets were projecting a pause followed by rate cuts, but this has changed to pricing in three more rate hikes this year. There is a lot of uncertainty in the air about inflation and interest rates and the markets are hoping that Powell's comments will provide some clarity. There is resistance at 0.9381 and 0.9420 0.9304 and 0.9224 are providing support
by OANDA
DXY Outlook 7th March 2023The DXY continued trading lower overnight as the price broke below the 104.40 support level (now turned resistance) and looks on track to test the round number support of 104. This move lower is most likely driven due to the strength of the Euro as ECB member Holzmann indicated the need for 4 more 50bps rate hikes, which saw the EURUSD climb steadily to the upside to approach the 1.07 resistance level. With Chair Powell due to testify at Congress today, expect to see higher volatility on the DXY. With markets anticipating a hawkish sentiment from the Feds, the DXY could bounce from the 104 support level to retest the 104.40 resistance level. However, in a trend-following scenario, we could look for the DXY to break beyond the 104 key support level to trade down to the next support level of 103.78. In summary, brief downside potential with the likelihood of a rebound if the Feds (Chair Powell) conveys a strong hawkish sentiment.
TVC:DXY
by JinDao_Tai
3
GBPNZD - I've got a trade idea for you!GBPNZD - I've got a trade idea for you! As we await for Powell! I found a this great trade idea, it's a break to either direction...Now remember, we could get false break out! Highs: 1.94570 Lows: 1.93620 Pattern: Triangle A break to either direction, break of 200 EMA area takes you to 0.382 & 0.236Fib areas. However, if we break above the trendline down, I expect target areas 1.95 half areas and perhaps even 1.96 half area matching the 1.618 area! Have a great day ahead, Trade Journal
by Trade_Journal