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gold trying to hold between 1961-1963 on bullish#XAUUSD price made a retraced back to 1959-1963 today which is now forming base on low volume, the price have pull back between trends and will still head down below 1956-1952 limit again but the price entry have hold much which is making the pair to bullish but now the charts is a retracment form. We may expect a correction bearish movement which can head more down but now let's follow on gold sell at 1962.48 but gold has a low bullish at 1965.90 which can break or make decline at heading down.
FOREXCOM:XAUUSDShort
by newbeginneracademy
More Downside for DXY?Last week's US Consumer Price Index (CPI) release of 3% (Forecast: 3.1% Previous: 4%) indicates that inflation growth has slowed significantly, likely due to the compounded effect of aggressive interest rate hikes from the Federal Reserve. This slowdown in inflation growth has also improved market sentiment that the Fed Funds Rate has reached its peak at 5.25% and the likelihood for further rate hikes has diminished. With the DXY breaking below the round number level of 100 and reaching a low, last seen in April 2022, further downside can be expected. However, watch out for the possibility of stronger-than-expected US retail sales data. A sustained rebound is unlikely, with the 100.85 resistance level likely to cap the upside potential. Confirmation of further downside could be signaled if the price breaks below 99.45, with the price likely to trade toward the next key support level at 97.75.
TVC:DXYShort
by JinDao_Tai
2
AUD/USD pares losses ahead of RBA rate decisionThe Australian dollar is showing some movement right off the bat on Monday. AUD/USD fell as much as 70 pips in the Asian session but has recovered most of those losses. In the European session, AUD/USD is trading at 0.6657 down 0.03%. The Reserve Bank of Australia meets on Tuesday, and it's a coin-toss as to whether the central bank will raise rates for a third straight time or will it take a pause. Traders have priced in a 52% chance of a pause, according to the ASX RBA rate tracker. Just one week ago, the odds of a pause were 70%, after May inflation declined more than expected. Headline CPI fell from 6.8% to 5.6%, its lowest level in 13 months. Core CPI eased to 6.1%, down from 6.7%. The split over what call the RBA will make on Tuesday is indicative of the case that can be made both for a hike and a pause. The drop in inflation is certainly welcome news, but the RBA wants inflation to fall faster, as it remains almost triple the target of 2%. Additional rate hikes would likely send inflation lower, but that would raise the risk of the economy tipping into a recession. The Australian economy has cooled down, but the labor market remains strong and consumer spending has been resilient, despite high inflation. Retail sales for May jumped 0.7% m/m, up from 0.0% in April and smashing the consensus of 0.1%. RBA members in favor of a hike can point to employment and retail sales data as evidence that the economy can withstand additional hikes. The RBA minutes, which can be considered a guide to its rate policy plans, might point to a pause at Tuesday's meeting. The April and May minutes were hawkish and the RBA raised rates after these releases. The June minutes were more dovish, sending the Australian dollar lower. Could that signal a pause? In the US, the week wrapped up with the PCE Price Index, the Fed's preferred inflation indicator. In June, the index rose 0.1% m/m, down from 0.4% in May. This indicates that the disinflation process continues and traders have raised the probability of a July hike to 88%, up from 74% a week ago, according to the CME FedWatch tool. 0.6659 is a weak resistance line. Above, there is resistance at 0.6722 0.6597 and 0.6534 are providing support
by OANDA
EURUSD | STILL BULLISH AT THE MOMENTHello Traders, price perfectly went with yesterday's prediction, tho entry was not precise but trade went well as you can see above. Today we have retail Sales releasing and also the US Crude Oil report with consensus that might not really be in favour of the United States or enough impact to help. The area marked in triangle is where I think price could change or reverse in support the Euro around 1.06500, what do you think 🤔?
Long
by Forex_Sentralytic
1
EURUSD | STILL BULLISH FOR TODAYThe market went with yesterday's prediction as seen on the chart above. Today we have the Retail Sales Report releasing with a consensus that indicates that more goods have been sold in favour of the Euro In about 5hrs. I think that price will fall a little bit in respect to the 1hr 200 EMA and start to rise again to hit around 1.07450 before falling again. I'll still hold my position today and wait to see if euro might fall very later but for now, I support the pair.
Long
by Forex_Sentralytic
1
GPS jumped on mediocre earningsGAp, Inc had a little pop after mediocre earnings to break its downtrend. IT put in an engulfing bull candle to strike three smaller red candles. This could be considered a bullish sign. However, the trend down has been much of the year with two head and shoulders along the way. There has been no significant net accumulation of stock. I suppose there was a volume spike of buyers thinking they were seeing the bottom. I do not think that the bottom is in until there is seller exhaustion. Price is below the POC line of the volume profile. I will not be convinced of a bottom until some net accumulation begins. I see the earnings pop as giving a better entry for a short and call it a pullback correction of the trend down and a great point to take a short trade.
GShort
by AwesomeAvani
2
USD/JPY punches above 140, Tokyo issues warningUSD/JPY is showing little movement on Tuesday. In the European session, USD/JPY is trading at 140.17, down 0.19%. The Japanese yen continues to underperform and has plunged 2.8% in May. The yen fell as low as 140.93 on Monday, its lowest level since November 21st. The sharp depreciation is raising concerns in Tokyo and Masota Kanda, a top official at the Ministry of Finance (MOF) weighed in on Tuesday. Kanda said officials were not focussing on particular exchange rate levels but said they were monitoring the forex market and "would respond appropriately". Kanda's veiled warning should not be ignored, as he blindsided the markets back in December when the MoF intervened in the currency markets in order to prop up the yen. Japanese releases have been solid, reinforcing speculation that inflation isn't going anywhere and the Bank of Japan may have to tighten policy. Service and manufacturing PMIs showed slight expansion last week and retail sales and industrial production will be released on Wednesday. Retail sales are expected to remain strong at 7.0% y/y in April, following a prior reading of 7.1%. Industrial production is projected to improve to 1.5% m/m in April, up from 1.1% in March. President Biden and Republican Speaker McCarthy have reached an agreement in principle on the debt ceiling, after weeks of brinkmanship between Republicans and Democrats. The deal must be approved in both houses of Congress, which is expected to happen despite grumblings from some Republicans. The weeks of uncertainty prior to the deal weighed on risk appetite and the big winners have been US Treasury yields and the US dollar. USD/JPY has support at 139.61 and 138.50 There is resistance at 140.88 and 141.73
by OANDA
1
GBP/USD edges lower, markets eye UK retail salesGBP/USD continues its downswing. The pound is trading at 1.2340, down 0.20% and is at a one-month low against the US dollar. The UK releases retail sales for April on Friday. On an annualized basis, the headline and core readings are expected to decline by 2.8% in April, which would indicate that UK consumers continue to hold tight onto the purse strings. Consumers are having a tough time with the cost of living crisis, with inflation at 8.3% and a weak reading could weigh on the pound. The US debt ceiling impasse remains unresolved, with the White House warning that the US could default on its debt on June 1st if no deal is reached in Congress. The markets are jittery and US 10-year Treasury yields have jumped to 3.75, up 1.1% today. The US dollar has also benefited from the debt ceiling crisis as investors have snapped up safe-haven assets. On Wednesday, Fitch Ratings put the top-ranked United States sovereign credit rating on "rating watch negative" due to the danger of a US debt ceiling default and we can expect market risk sentiment to continue falling as we move closer to June without a deal in place. The FOMC minutes indicated that the Fed remains unclear over future rate policy. At the May meeting, some members said there was a need for further increases as inflation was not falling fast enough. Other members argued that the economy was cooling and there was no need for more tightening. All the members agreed that inflation remains too high and the vote to raise rates by 25 basis points at the May meeting was unanimous. So what's next? The Fed meets on June 14th and appears to be leaning towards a pause in rate increases. The odds of a pause are currently 62%, versus 37% for a 25-bp hike, according to CME's FedWatch. Just a month ago, the probabilities were 70% for a pause, 8% for a 25-bp hike and 22% chance for a rate cut of 25 basis points. A hawkish Fed and solid US data have put to rest market speculation of a rate cut next month. Speaking of solid economic data, US Preliminary GDP rose 1.3% y/y in the first quarter, up from 1.3% in Q4 2020, which was also the estimate. On a quarterly basis, GDP climbed 4.2%, above the estimate of 4.0% and after a Q4 gain of 4.0%. Unemployment claims rose to 229,000, following a previous reading of 225,000, which was downwardly revised from 242,000. This easily beat the estimate of 245,000. The Fed will not be thrilled with these numbers, as it needs the economy to cool in order to wrap up the current rate-tightening cycle. GBP/USD tested support at 1.2375 in the European session. Below, there is support at 1.2307 1.2461 and 1.2529 are the next resistance levels
by OANDA
2
NZD/USD unchanged ahead of New Zealand retail salesThe New Zealand dollar is coming off a strong week, with gains of 1.36%. In Monday's North American session, NZD is unchanged, trading at 0.6274. New Zealand releases retail sales on Tuesday. The central bank's tightening has hampered consumer spending and the markets are bracing for a decline in retail sales for the first quarter. Headline retail sales are expected at -0.4%, after -0.6% in Q4 2022. The core rate is projected to decline by 0.6%, following -1.6% in Q4. The retail sales report will be followed by the Reserve Bank of New Zealand's rate decision on Wednesday. The markets have priced in a modest 25-basis point hike, which would be the smallest increase since February 2022, when the central bank raised rates from 0.75% to 1.00%. The central bank has not been shy about tightening, with the benchmark cash rate currently at 5.25%. Inflation in March from 7.2% to 6.7% on an annualized basis, more than double the upper range of the 1-3% target. The RBNZ is unlikely to wind up the current rate-tightening cycle before inflation drops substantially. There was some positive news earlier in the month, as inflation expectations eased in the first quarter to 2.79%, down from 3.30% in the previous quarter. This may have cemented a 25-bp hike on Wednesday, as the central bank pays close attention to inflation expectations, which if embedded can lead to higher inflation. Fed Chair Jerome Powell said on Friday that the banking sector turmoil could mean that the Fed will not have to raise rates "as much as it would have otherwise". Powell reiterated that inflation remained too high and future rate decisions would depend on data. The takeaway from Powell's remarks is that we could be close to the end of the current rate-hike cycle, but inflation will have to cooperate and move lower to the 2% target. NZD/USD is putting pressure on support at 0.6256. Below, there is support at 0.6207 0.6326 and 0.6375 are the next resistance lines
by OANDA
1
USD/CAD - Will retail sales weigh on the Canadian dollar?The Canadian dollar is trading quietly ahead of a key retail sales report later today. USD/CAD is trading in Europe at 1.3484, down 0.13%. The Canadian consumer is holding tightly to their wallet, which is not all that surprising in the current economic climate. Inflation ticked higher in April, rising from 4.3% to 4.4%. Add in high interest rates and it's not hard to sympathize with consumers who are struggling with the cost of living. The April retail sales report may show that things are getting worse - headline retail sales is expected to slow to -1.4%, down from -0.2% in March, and the core rate is expected to fall from -0.7% to -0.8%. Not exactly a winning recipe for economic growth. A decline in today's report could unnerve investors and send the Canadian dollar lower. The Bank of Canada will not be pleased with the slight increase in inflation, although the core rate, which is a more reliable gauge of inflation trends, did move lower. The BoC meets next on June 7th and there is only one more tier-1 release before the meeting, that being GDP. If retail sales contracts for a second straight month as expected, there will be more support for the BoC to continue to hold rates at 4.50%, where they have been pegged since March. It's a bare economic calendar in the US today, with no data releases. The markets will have a chance to focus on Fedspeak, with Jerome Powell and two FOMC members delivering public remarks. Just a few weeks ago, the markets had priced in a pause at the June meeting at over 90%. That has changed to a 66% chance of a pause and a 33% chance of a hike of 25 basis points, according to CME's FedWatch. That downward revision is due to a consistently hawkish message from the Fed and a solid US economy. USD/CAD is testing support at 1.3479. Below, there is support at 1.3394 1.3644 and 1.3729 are the next resistance lines
by OANDA
GBP/USD ends slide, employment report nextGDP/USD has started the week in positive territory, after a two-day slide that saw the pound lose 1.5%. In the North American session, GBP/USD is trading at 1.2514, up 0.54%. On the economic calendar, it's a fairly quiet start to the week. There are no releases out of the UK. In the US, the Empire State Manufacturing Index slid to -31.8, versus 10.8 prior and an estimate of -2.5 points. This was the lowest level in three years and pointed to a sharp contraction. Orders and inventories fell sharply, and the report was another indication of the sorry state of the manufacturing sector. The US releases retail sales on Tuesday, with the markets expecting an improvement in the April data. The headline reading is expected to improve to 0.7%, up from -0.6%, and the core rate is projected to rise to 0.4%, up from -0.4%. If the data is within expectations, it would indicate that consumers are still spending, despite a drop in consumer confidence. Friday's GDP release pointed to a UK economy in trouble. March GDP came in at -0.3%, and Q1 growth posted a meagre gain of 0.1%. The economy might manage to avoid a recession, but the BoE is projecting practically zero growth in 2023. The labour market has remained robust in the UK, despite the weak economy and the bite of rising interest rates. However, cracks are appearing - unemployment claims rose by 28,200 in April, and are expected to rise by 31,200 in the April report, which will be released on Tuesday. The Bank of England will be keeping a close eye on wage growth, a driver of inflation. The estimate for average earnings including bonuses for January-March stands at 5.8%, versus 5.9% in the previous release. GBP/USD is putting pressure on resistance at 1.2524. The next resistance line is 1.2604 1.2369 and 1.2289 are the next support levels
by OANDA
AUD/USD - Australian dollar takes traders for a wild rideThe Australian dollar has steadied on Monday, trading just above the 0.67 level. We could see further movement from the Aussie early on Tuesday, as China releases GDP. The markets received another clear sign on Friday that the US economy is slowing, after a disappointing March retail sales report. Headline retail sales fell by 1% and the core rate by 0.8%, worse than expected and marking a second straight decline for both. A soft US retail sales report is usually a recipe for US dollar weakness, but that wasn't the case on Friday, as AUD/USD fell by 1%. The US dollar received a boost from strong earnings results, higher inflation expectations and some hawkish Fed speak. Bank earnings impressed on Friday, with strong results from JP Morgan, Citigroup and Wells Fargo. This indicates that the bank crisis has been contained for now, although further contagion cannot be ruled out. On the inflation front, UoM inflation expectations for 12 months jumped 4.6% in April, up sharply from 3.6% in March. Consumer confidence has been on the low side as inflation remains high, and the weak retail sales report was clear proof that consumers are spending less due to high inflation and rising rates. Fed member Waller had a hawkish message on Friday, saying that the Fed would need to continue raising rates because inflation is "far above target" and the labor market remains "quite tight". Waller warned that the Fed would have to keep rates at a high level for an extended period and for longer than the markets expected. Fed member Bostic said he supported one or two more 25-bp hikes to end the current tightening cycle. The likelihood of a 25-bp increase in May has jumped to 80%, up from 68% prior to the retail sales release. There is resistance at 0.6897 and 0.6791 AUD/USD tested support below 0.6700 earlier today. The next support level is 0.6608
by OANDA
GBP/USD - Another strong week for the British poundThe British pound is poised to post its fifth successive winning week. During this time, the GBP/USD has sparkled, rallying almost 500 points. This week's UK releases have not been as positive as the pound's upswing. GDP was flat in February on a monthly basis, down from 0.4% in January and unable to hit the estimate of 0.1%. Manufacturing Production was also flat and Industrial Production came in at -0.2%. Inflation remains in double digits, despite the Bank of England's aggressive rate policy, which has raised the benchmark cash rate to 4.25%. The combination of high inflation and rising interest rates has created a cost-of-living crisis and is weighing on businesses as well. To make things even worse, the country has been hit by widespread strikes in the public sector, as workers protest the drop in real income due to soaring inflation. An IMF forecast released this week indicated that the UK economy is projected to be the worst performer in the G20, which includes Russia. The economic situation isn't pretty, and the government and the BoE are under strong pressure to right the ship, and fast. Finance Minister Hunt has said he'll cut inflation in half and a recession can be avoided, but it's hard to share his optimism. This week pointed to further deceleration in inflation levels in the US. Headline CPI fell to 5.9%, down from 5.0%, although the core rate nudged up to 5.6%, up from 5.5%. The Producer Price Index declined to 2.7%, down sharply from 3.4%, and the core rate eased to 3.4%, down from 4.8%. Will the drop in inflation be accompanied by a decline in consumer spending? The markets are bracing for a soft retail sales report for March. Headline retail sales is expected to fall by 0.4% y/y and the core rate is projected to decline by 0.3% y/y.  A weak release could push the US dollar lower, as there will be more pressure on the Fed to consider pausing its rate hikes at the May meeting. GBP/USD touched resistance at 1.2537 earlier. The next resistance line is 1.2656 There is support at 1.2405 and 1.2282
by OANDA
EUR/USD - Euro gains ground as investor confidence improvesThe Eurozone economy continues to recover, but there is plenty of work ahead. The Sentix Investor Confidence index improved to -8.7 in April, above the March read of -11.1 and better than the estimate of -11.7 points. The concerns over an energy crisis in Europe this winter failed to materialize and Germany and the rest of the eurozone came out of the winter better than many had expected, given the weak global economy and the Russia-Ukraine war. Still, the economic outlook remains pessimistic, as Sentix Investor Expectations remain negative in both Germany and the eurozone, at -13 and -11.5, respectively. Still, the markets were pleased with the slight improvement in investor confidence and the euro has responded with gains of around 0.60%. Eurozone retail sales slipped to -0.8% in February, matching the forecast but contracting after an upwardly revised 0.8% gain in January. Consumers are struggling with high inflation, rising interest rates and uncertain economic conditions and are keeping a tight grip on their wallets and purses. The ECB meets next on May 4th and all indications are that it will deliver another oversize rate hike. The central bank has been aggressive, raising rates by 50 and 75 basis points in recent months. The ECB was very slow to join the rate-hiking party and the benchmark rate is only 3.50%, compared to 4.25% for the Bank of England and 5.00% for the Federal Reserve. Inflation in the eurozone has proven to be a tougher foe than expected, and core inflation surprised by accelerating in February. The US releases the March inflation report on Wednesday. Inflation has been falling, albeit at a slower pace than the Fed had expected. This has necessitated additional rate hikes, with a 25-bp increase expected at the May meeting. Headline inflation is expected to fall to 5.4% in March, down from 6% in February. The core rate is projected to inch higher to 5.6%, up from 5.5%. EUR/USD is testing support at 1.0889. Below, there is support at 1.0804 There is resistance at 1.0989 and 1.1074
by OANDA
AUD/USD - Aussie on the move, RBA expected to pause ratesThe Australian dollar has edged higher at the start of the week. In the European session, AUD/USD is trading at 0.6715, up 0.45%. The RBA meets on Tuesday (Australia time) and is expected to pause rates. The US releases ISM Manufacturing PMI, which is expected to record another decline. The RBA has aggressively tightened interest rates in the current cycle, raising rates 10 straight times. The fight against inflation continues but there has been some improvement. February CPI fell sharply to 6.8%, vs. 7.4% prior and 7.1% anticipated. Inflation is more than triple the RBA target, but the sharp rise in rates has dampened economic activity and further hikes could jeopardize a soft landing. The RBA is widely expected to stay on the sidelines, with the market pricing in a pause at 86%. Governor Lowe has said that in addition to inflation, employment and consumer spending data would play a key factor in the RBA's decision. The labour market remains tight, but retail sales hit the breaks in February and slowed to just 0.2%, down from 1.8% in January and just above the consensus estimate of 0.1%. The weak retail sales data supports the RBA taking a breather. The banking crisis, which roiled global financial markets, raised fears of a financial meltdown. Although the contagion appears to have been contained, central banks are having to think twice about raising rates in an uncertain economic landscape, and if the RBA does pause, it could use the banking crisis as further ammunition in defending its decision. We're seeing a decline in manufacturing across the globe as demand remains weak. The Russian invasion of Ukraine and China's Covid-zero policy interrupted supply chains and dampened demand, and manufacturing is yet to recover even though China has made an about-face and relaxed its Covid regulations. The US is no exception to this disturbing global trend. ISM Manufacturing PMI has been in decline for four straight months, with readings below the 50 threshold, which separates expansion from contraction. The estimate stands at 47.5, a bit lower than the 47.7 reading in January. AUD/USD is putting pressure on resistance at 0.6737. Above, there is resistance at 0.6790 There is support at 0.6678 and 0.6582
by OANDA
AUD/USD - Aussie falls as inflation dipsThe Australian dollar is trading at 0.6670 in Europe, down 0.57%. Australian inflation was lower than expected, raising speculation that the Reserve Bank of Australia might pause at its April meeting. Australia's inflation rate for February eased to 6.7% y/y, down from 7.4% prior and the 7.2% estimate. It may be too early to declare that inflation has peaked, but there's no question that inflation is heading in the right direction. That is good news for businesses and households, which have been hurt by the double-punch of high inflation and rising interest rates. The unexpected sharp drop in inflation likely has cemented the RBA pausing at the April 4th meeting, and that is weighing on the Australian dollar today. RBA Governor Lowe had said that this week's retail sales and inflation releases would be key factors in the rate decision. Retail sales slowed to just 0.2% m/m in February, down from 1.2% prior and shy of the estimate of 0.4%. Weak consumer spending and falling inflation point to the economy slowing, and the RBA will likely respond with a pause, which would be the first since the rate-tightening cycle began in May 2022. The markets have fully priced in a pause at next week's meeting, with a likelihood of around 90%. In the US, higher rates have taken a toll on the housing sector. Pending Home Sales has recorded mostly declines over the past year, as potential home buyers are finding it more difficult to afford a new home. The indicator is expected to come in at -2.9% in February, after an unexpected jump of 8.1% in January. AUD/USD is testing resistance at 0.6676. Above, there is resistance at 0.6728. There is support at 0.6565 and 0.6402
by OANDA
AUD/USD eyes CPI, GDPThe Australian dollar remains under pressure and has edged lower on Tuesday. AUD/USD dropped below the 0.67 line on Monday for the first time since Jan. 3. Australian retail sales jumped 1.9% m/m in January, following an upwardly revised 4% decline in December and beating the consensus of 1.5%. The data indicates that consumer demand remains resilient despite rising interest rates and higher inflation. For the RBA, the upswing in consumer spending is a sign that the economy can continue to bear higher rates. The central bank has hiked some 325 basis points since May 2022 in a bid to curb inflation. The cash rate is currently at 3.35% and the markets have priced in a peak rate of 4.3%, with four rate hikes expected before the end of the year - one more than what is expected for the Fed. The RBA meets on March 7 and is widely expected to raise rates by 25 basis points. Wednesday could be a busy day for the Australian dollar, as Australia releases inflation and GDP reports. Inflation for January is expected to ease to 7.9% y/y, following an 8.4% gain in December. GDP for the fourth quarter is projected to slow to 2.7% y/y, after a robust gain of 5.9% in Q3. A decline in inflation and in GDP would indicate that high interest rates are having their intended effect and slowing economic activity. The question is whether the RBA will be able to guide the slowing economy to a soft landing and avoid a recession. In the US, a recent string of strong numbers has raised speculation that the Fed could raise interest rates as high as 6%. The unseasonably warm weather in January may have played a part in the better-than-expected numbers and we'll have to see if the positive data repeats itself in February. The markets have shifted their stance from a final rate hike in March with rate cuts late in the year to pricing in three more rate hikes in 2023. If upcoming inflation, employment and consumer spending reports point to a weaker economy, we can expect the markets to revert to pricing in a dovish pivot by the Federal Reserve. AUD/USD has support at 0.6656 and 0.6586 There is resistance at 0.6788 and 0.6858
by OANDA
AUDUSD:Potential Breakout due to strong USD envrionmentHey Traders, based on the last strong NFP numbers that were out of expectations with 517,000 new jobs created in January, retail sales smashing expectations of 1.9% with 3%, CPI and other strong USD data we can notice that the market is pricing more rate hikes, and we expect the USD to continue outperforming until the next fed decision on March that will clarify more the USD path. in case of a breakout on AUDUSD chart i would monitor a retrace around 0.685 zone. i would also like to give a risk management advice to traders, i personally risk between 0.5% to 2% per trade so even if i'm in the wrong path that would take me a bunch of consecutive losing trades to get my account marginated which is too far. so for example if you risk 1% per trade that will take you more than a hundred consecutive losing trades to lose your account. but if you risk 10 times the recommended amount for example a 20% risk per trade that means 4-5 consecutive losing trades will knock your account out from the market. Please feel free to ask me questions regarding fundamentals and technicals in the comment section! Trade safe, Joe. source of USD data: www.forexfactory.com
Short
by JoeChampion
26
EUR/USD at 3-week low after strong US dataThe euro is down for a third straight day and fell earlier to 1.0629, its lowest level since Jan. 23. In the European session, EUR/USD is trading at 1.0639, down 0.30%. The US dollar is showing some strength this week against the majors, as US data continues to shine. Retail sales impressed with a 3% gain earlier this week, and PPI and unemployment claims were both better than expected. Is the disinflation process stalled? The markets didn't expect such good numbers, but the economy has proved to be surprisingly resilient to rising interest rates. The Fed has been preaching 'higher for longer' for some time, but the markets stuck to their dovish stance, expecting that the Fed would have to pivot and even cut rates later in the year. The host of strong US numbers has forced investors to recalibrate, and the markets have revised upwards their peak rate forecast to above 5%. The US dollar has been the big winner of the shift in market thinking, and US Treasury yields are at their highest level this year. Fed member Mester said she saw a strong case for raising rates by 50 basis points at the last Fed meeting, a sign that the Fed could move away from the moderate 25-bp hikes if inflation isn't falling quickly enough. Mester said that she didn't see inflation falling to 2% until 2025, which points to a long disinflation process. The ECB raised rates by 50 basis points in February and has signalled that it will do the same at the Mar. 16 meeting. The main financing rate is currently at 3%, well below the Fed (4.5%) and other major central banks. It's not clear what the Bank has planned after the first quarter, but with inflation running at 8.5%, the risk for further rate hikes is skewed to the upside. The ECB has made it clear that rates will remain high until there is evidence that inflation is falling toward the target, which means that the current rate-tightening cycle isn't anywhere near its end. EUR/USD is testing support at 1.0629. Below, there is support at 1.0581 1.0762 and 1.0847 are the next resistance lines
by OANDA
1
GBP/USD steadies, eyes UK retail salesThe British pound has steadied on Thursday. In the European session, GBP/USD is trading at 1.2053, up 0.25%. This follows a sharp drop of 1.2% a day earlier. UK inflation continues to fall but remains disturbingly high. Headline inflation fell to 10.1% in January, down from 10.5% in December and below the consensus of 10.3%. The drop in inflation is welcome news, but food prices, a key driver of inflation, surged by 16.8% in January. With inflation still in double digits, the Bank of England will have to continue raising rates, with the most likely scenario being a 25-basis increase at the Mar. 22 meeting. The market probability of a 25-bp hike rose as high as 73% on Wednesday before dipping to 66% today, according to Refinitiv data. In the US, retail sales delivered an impressive gain of 3% in January, above the estimate of 1.8%. This was a strong rebound from the December reading of -1.1% and marked the largest gain since January 2022. This positive release follows the January inflation report that ticked lower to 6.4% but was higher than expected. These strong numbers translated into strong gains for the US dollar on Wednesday, as the Fed will likely raise rates even higher in order to put the brakes on the strong economy. The UK wraps up the week with retail sales on Friday. The markets are braced for bad news, with an estimate of -5.5% y/y for the headline figure (-5.8% prior) and -5.3% for the core rate (-6.1%). A weak retail sales report could sour investors on the pound and send the currency lower. GBP/USD tested resistance at 1.2071 earlier in the day. The next resistance line is 1.2180 1.1958 and 1.1838 are providing support
by OANDA
Key Levels and Market overview into the Asian session openA look at the price action from the European and US sessions and what that may mean for the Asian market open after some stronger than expected US retail Sales triggered a choppy session. I feel data is still showing 'sticky inflation' which eventually leads to higher interest rates and lower spending which will cap the indexes...although traders are focused on a resilient economy fending off a recession.. I look at some key levels to watch and the price action setups I expect to play out. Markets covered :- DOW Nasdaq DAX FTSE ASX200 Hang Seng USD Index Gold Oil Copper
CBOT:ZN1!
by TradeTheStructure