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A quick glance at what's happening after the NFP releaseLet's see how markets are performing right now after we received the US NFP number for January, which showed a significant decline from the previous reading. However, average hourly earnings improved and unemployment fell to 4%. Last time we saw a reading as low as 4% was back in June of 2024. MARKETSCOM:DOLLARINDEX MARKETSCOM:GOLD FX_IDC:USDJPY FX_IDC:USDCAD 74.2% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Past performance is not necessarily indicative of future results. The value of investments may fall as well as rise and the investor may not get back the amount initially invested. This content is not intended for nor applicable to residents of the UK. Cryptocurrency CFDs and spread bets are restricted in the UK for all retail clients.
MARKETSCOM:DOLLARINDEX
by Marketscom
Surging Dollar Spurs Jump in Corporate FX HedgingThe relentless rise of the U.S. dollar is sending ripples of concern through the global economy, and businesses are taking notice. Faced with a strengthening greenback, corporations are increasingly turning to foreign exchange (FX) hedging strategies to mitigate the impact of currency fluctuations on their bottom lines. This surge in hedging activity reflects a growing awareness of the risks associated with currency volatility and a proactive approach to protecting profits in an increasingly uncertain global landscape. The Dollar's Dominance The U.S. dollar has been on a tear, appreciating significantly against a basket of other major currencies. This surge is driven by a confluence of factors, including the Federal Reserve's hawkish monetary policy, safe-haven demand amid geopolitical tensions, and the relative strength of the U.S. economy. While a strong dollar can have some benefits, such as lower import costs, it also poses significant challenges for multinational corporations.1 Impact on Corporate Earnings For companies that generate revenue in foreign currencies but report earnings in U.S. dollars, a strong dollar can create a significant headwind. When foreign revenues are converted back into dollars, they are worth less than they were before the dollar's appreciation. This can lead to lower reported earnings, even if the company's underlying business performance remains strong. Conversely, companies that import goods priced in dollars but sell them in other currencies see their profit margins squeezed as their input costs rise. The Hedging Imperative In this environment of heightened currency risk, FX hedging has become a crucial tool for corporations.2 Hedging involves using financial instruments, such as forward contracts, options, or swaps, to lock in exchange rates for future transactions.3 This allows companies to insulate themselves from adverse currency movements and provides greater certainty about their future cash flows and earnings.4 Surge in Hedging Activity Market data suggests a significant uptick in corporate FX hedging activity. Treasurers and finance departments are increasingly prioritizing currency risk management, recognizing that even small fluctuations in exchange rates can have a material impact on their financial results. This increased focus on hedging is driven by several factors: • Heightened Volatility: The dollar's rapid appreciation has created significant volatility in currency markets, making it more difficult for companies to predict future exchange rates. This uncertainty underscores the need for hedging strategies to protect against unexpected currency swings. • Earnings Protection: As mentioned earlier, a strong dollar can erode corporate earnings. Hedging allows companies to mitigate this risk and ensure that their financial performance is not unduly impacted by currency fluctuations.5 • Strategic Planning: Hedging provides greater predictability in cash flows, which is essential for strategic planning and investment decisions.6 By locking in exchange rates, companies can make more informed decisions about future investments and expansion plans.7 • Shareholder Expectations: Investors are increasingly scrutinizing companies' currency risk management practices. Companies that proactively hedge against currency risks are often seen as more prudent and better managed, which can be a positive factor for investor confidence. Types of Hedging Strategies Companies employ a variety of hedging strategies depending on their specific needs and risk tolerance.8 Some common approaches include: • Forward Contracts: These contracts obligate a company to buy or sell a specific amount of currency at a predetermined exchange rate on a future date.9 This is a straightforward way to lock in exchange rates for future transactions. • Options: Currency options give a company the right, but not the obligation, to buy or sell currency at a specific price on or before a certain date.10 Options provide flexibility and allow companies to benefit from favorable currency movements while limiting their downside risk.11 • Currency Swaps: These agreements involve exchanging principal and/or interest payments in one currency for those in another currency.12 Swaps can be used to manage currency risk associated with long-term debt or investments.13 Challenges and Considerations While hedging can be an effective way to manage currency risk, it's not without its challenges. Hedging strategies can be complex and require specialized expertise. Furthermore, hedging involves costs, such as premiums paid for options or fees for forward contracts.14 Companies need to carefully weigh the costs and benefits of hedging and choose strategies that are appropriate for their specific circumstances. Looking Ahead The strong dollar is likely to remain a significant factor in the global economy for the foreseeable future. As such, corporate FX hedging is expected to remain a priority for multinational companies. Companies that proactively manage their currency risk are better positioned to navigate the challenges of a strong dollar environment and protect their earnings from adverse currency movements.15 The current surge in hedging activity reflects a growing recognition of this reality and a proactive approach to mitigating currency risk in an increasingly interconnected world. As global economic conditions evolve, companies will need to remain vigilant and adapt their hedging strategies accordingly to ensure they are adequately protected from currency volatility.
TVC:DXYLong
by bryandowningqln
Dollar Reaching Mayor Resistance From Decades Since 2009 the dollar index has been moving in a bullish direction , I saw the price has rejected several times a zone I marked as Mayor Resistance that it might been posible to reject again but the price has dropped without further reaching this price line making a higher low and I see the possibility that the price can reach to find liquidity and drop again or break this mayor resistance and try to get a higher high but that will take much time and see this happening can affect the price of other assets in a bearish direction…
TVC:DXYLong
by SQUAREDJOHNFX
DXY US Dollar Index Market Bearish Heist Plan🌟Hi! Hola! Ola! Bonjour! Hallo!🌟 Dear Money Makers & Robbers, 🤑 💰🐱‍👤 Based on 🔥Thief Trading style technical and fundamental analysis🔥, here is our master plan to heist the DXY US Dollar Index Market. Please adhere to the strategy I've outlined in the chart, which emphasizes short entry. Our aim is the high-risk Green Zone. Risky level, oversold market, consolidation, trend reversal, trap at the level where traders and bullish robbers are stronger. 🏆💸Be wealthy and safe trade.💪🏆🎉 Entry 📈 : "The vault is wide open! Swipe the Bullish loot at any price - the heist is on! however I advise placing Sell limit orders within a 15 or 30 minute timeframe. Entry from the most recent or closest high or low level should be in retest. Stop Loss 🛑: Thief SL placed at 108.500 (swing Trade) Using the 2H period, the recent / nearest low or high level. SL is based on your risk of the trade, lot size and how many multiple orders you have to take. Target 🎯: 106.000 (or) Escape Before the Target Scalpers, take note 👀 : only scalp on the Short side. If you have a lot of money, you can go straight away; if not, you can join swing traders and carry out the robbery plan. Use trailing SL to safeguard your money 💰. 📰🗞️Fundamental, Macro, COT, Sentimental Outlook: DXY US Dollar Index Market is currently experiencing a Bearish trend., driven by several key factors. 🟦Fundamental Analysis: - The US Dollar Index (DXY) has been under pressure due to the contraction in JOLTS job openings, indicating a tightening job market - The Federal Reserve's monetary policies, geopolitical stability, and global acceptance of the dollar as a reserve currency contribute to the dollar's strength - A strong economy with high productivity, low unemployment, and stable inflation provides a foundation for strengthening the dollar's position 🟫Macro Analysis: - The US economy is expected to remain strong, with low unemployment and stable inflation, supporting the dollar's value - Global trade tensions and geopolitical instability may impact the dollar's value, but its status as a reserve currency provides stability - Interest rate decisions by the Federal Reserve will influence the dollar's value, with potential rate cuts impacting its strength 🟪Sentimental Analysis: - 60% of client accounts on IG are long on the US Dollar Index, indicating a bullish sentiment - However, the recent contraction in JOLTS job openings and potential Fed rate cuts may lead to a bearish sentiment 🟧COT Analysis: - The latest Commitment of Traders (COT) report shows that speculators are net long on the US Dollar Index, indicating a bullish sentiment - However, the report also shows that commercial traders are net short, indicating a potential bearish sentiment 🟨Positioning: - Corporate traders may consider hedging their exposure to the US Dollar Index due to potential volatility - Investor and hedge fund traders may consider going long on the US Dollar Index due to its potential strength, but should be cautious of potential rate cuts and geopolitical instability - Institutional traders may consider diversifying their portfolios to minimize exposure to the US Dollar Index - Retail traders should exercise caution when trading the US Dollar Index due to its potential volatility and should consider using proper risk management strategies ⚠️Trading Alert : News Releases and Position Management 📰 🗞️ 🚫🚏 As a reminder, news releases can have a significant impact on market prices and volatility. To minimize potential losses and protect your running positions, we recommend the following: Avoid taking new trades during news releases Use trailing stop-loss orders to protect your running positions and lock in profits 📌Please note that this is a general analysis and not personalized investment advice. It's essential to consider your own risk tolerance and market analysis before making any investment decisions. 📌Keep in mind that these factors can change rapidly, and it's essential to stay up-to-date with market developments and adjust your analysis accordingly. 💖Supporting our robbery plan will enable us to effortlessly make and steal money 💰💵 Tell your friends, Colleagues and family to follow, like, and share. Boost the strength of our robbery team. Every day in this market make money with ease by using the Thief Trading Style.🏆💪🤝❤️🎉🚀 I'll see you soon with another heist plan, so stay tuned 🤑🐱‍👤🤗🤩
FXOPEN:DXYShort
by Thief_Trader
DXY Trading JournalDXY Trading Journal Feb 5 Price actions wild rally on Sunday to swipe the buy side and then has been energetic to rebalance the damage. Yesterday Price had a run on stops and rebalanced recent inefficiencies, in a distribution cycle. Price rebalanced Sundays and Mondays inefficiencies. Price is in Premium on W, and Daily chart coming to the 50 level and is still rebalancing a HTF Weekly SIBI. The range Price is trading in seems to be in deep discount just below the .70 level. Equal lows sell side and volume imbalance could be the magnet if price seeks lower prices. I would say for the day Price is in a double discount. Asia has opened in a discount on the range and energetically came to the 50 and lowered and for the moment continuing its seeking of lower prices. My logic says if price takes out the noted sell side liquidity it should react and seek the 50 level at 108,000, and yet it could just keep seeking lower prices. Non farm payroll week with PMI today in NY session. Follow your rules, stay out unless your complete model lines up.
TVC:DXY
by LeanLena
DXYDXY, or the U.S. Dollar Index, measures the value of the U.S. dollar against a basket of six major currencies: the euro (EUR), Japanese yen (JPY), British pound (GBP), Canadian dollar (CAD), Swedish krona (SEK), and Swiss franc (CHF). It serves as a key indicator of the dollar’s strength in global markets. The index is influenced by factors such as Federal Reserve policies, interest rates, inflation, and geopolitical events. A rising DXY indicates a stronger dollar, while a falling DXY suggests a weaker dollar, impacting commodities, forex pairs, and global trade.
FXOPEN:DXYLong
by HavalMamar
DXY Trading JournalDXY Trading Journal Jan30 Price took buy stops from last Friday, closed just above where it opened. Price did in fact seek higher prices, gravitating to the equal high, rebalancing a Hourly FVG and creating equal highs inside a FVG it rebalanced I did not have noted. COOL! Tuesday was consolidation pattern, yesterday a expansion to buy side and then a reversal in NY. Today in Asia price is opening to a consolidation in a previous sessions discount. Have to read the chart for clues if Price will retrace back up to the 50% and take the FVG? Price is delivering to a premium on the Daily chart and current range. I consider that we might see Price seek lower prices, with a FVG, volume imbalance, with a event horizon and multiple MOGs lower I suspect could be the magnet. be nimble and read what the chart offers. Could be another low resistance day of price action. The set up are getting easy to spot.
TVC:DXYShort
by LeanLena