Dollar: EUR/USD and USD/JPY Critical after 5 Week USDollar Rally

RELATED QUOTES

SymbolPriceChange
^USDOLLAR11,881.77-0.65
EURUSD=X1.1267-0.0036
USDJPY=X100.3950+0.197
GBPUSD=X1.3247+0.0049
AUDUSD=X0.7627+0.001

  • Dollar: EUR/USD and USD/JPY Critical after 5 Week USDollar Rally
  • Japanese Yen Traders Watch G20, Government and BoJ Candidates
  • Euro Climb Threatened if ECB Eases Pressure, LTRO2 Repayment Small
  • British Pound Ready for Volatility but Can Jobs and BoE Minutes Carry Trend?
  • Canadian Dollar Traders Watch CPI Release for Signs of BoC Shift
  • Australian Dollar: Rising 10-Year Yields May Reflect Falling Foreign Demand
  • Gold Suffers Critical, Bearish Break as G20 Take Up FX Competition

New to FX?Watch thisVideo; For live market updates, visitDailyFX’s Real Time News Feed

Dollar: EUR/USD and USD/JPY Critical after 5 Week USDollar Rally

As resolute as risk appetite seems in the S&P 500’s refusal to retreat and volatility measures’ anchor to multi-year lows, the dollar gained a significant foothold this past week. The equal-weighted Dow Jones FXCM Dollar Index (ticker = USDollar) won its fifth consecutive weekly rally with Friday’s close. With this impressive run, the benchmark is up over 6 percent from its September lows and currently at its highest level since September 2010. This strength still draws confusion, though, as most associate the dollar to EURUSD. This particular pair was little changed on Friday and on the week, but it is also 2.5 percent off its highest from the start of this week. This pair hasn’t prevented the greenback’s underlying strength, but it will likely prove critical as to whether the trend can continue.

In contrast to the pressure the Euro has exacted on the dollar, the reserve currency has found considerable buoyancy through USDJPY – which is benefiting from Japan’s determination to devalue their currency. Yet, a more than 20 percent climb in the span of five months smacks of an extreme position that demands relief. Though the G20 statement seems as if it will carry a soft threat to competitive currency devaluation, the market may take the opportunity to back off of the yen in general. If that is the case, the dollar’s top bullish contributor will leave a gaping hole. In steps EURUSD. A correction from the most liquid pairing and break of an established (and unfavorable for the dollar) trend can strike just the right level of strength for the greenback. But that will take something provocative – risk aversion or stimulus imbalances narrowing.

Japanese Yen Traders Watch G20, Government and BoJ Candidates

There are a few different fundamental lines to keep track of for trading the yen – a situation that adds to the risk of reversal. Most immediate for FX watchers is the impact that the G20 statement will have on central bank frontrunners’ positioning. Vows by policy officials to evoke the unlimited stimulus effort and thereby collapse the currency have worked wonders. Yet, since the G7 hurled its indirect warning at Japan, the FX market has been on hold. Even if the country isn’t labeled in the bigger meet’s statement, we may have just enough to concern to deflate yen exposure. That brings us to our second order business: a constant watch on government officials’ (Prime, Finance and Economy Ministers) remarks on policy and stimulus intentions. And, finally, we must keep a vigilance on the BoJ Governor search.

Euro Climb Threatened if ECB Eases Pressure, LTRO2 Repayment SmallThough it has not been an active endeavor, the European Central Bank (ECB) has seen its balance sheet shrink – a dramatic contrast to its global counterparts. In fact, the region’s stimulus exposure has dropped over 10 percent since the pivotal policy meeting in which the group introduced its OMT program. In rough financial waters, this would prove worrisome; but in these conditions where investors chase anemic yields with no thought of risk, it is a serious boon. We have seen market rates rise substantially for the Euro. Yet, that trend certainly broke last week with short-term yields retreating. Is the ECB softening on growth, inflation, jobs? Watch the first scheduled repayment of LTRO2 on Friday.

British Pound Ready for Volatility but Can Jobs and BoE Minutes Carry Trend?

This past week, the sterling dropped against all of its liquid counterparts – ranging from a 0.9 percent stumble against the yen up to the aggressive 3 percent drop versus the New Zealand dollar. The most recent selling extends a general trend since the year began. The pound has been significantly weakened. What’s the drive behind this move? Investors are starting to apply more weight to the triple dip recession the UK has fallen into which in turn leverages concerns that the Bank of England (BoE) will inevitably catch up to the Fed and BoJ with more stimulus. So far, these fears haven’t played out. Coming up, the minutes from the last central bank meeting can perhaps give more clues as to a time frame. That said, if it doesn’t feed the doves / bears and jobs data is decent; an oversold pound may receive a pop.

Canadian Dollar Traders Watch CPI Release for Signs of BoC Shift

Not six months ago, the Canadian dollar seemed the perfect currency. Not only did it avoid the worst of the global financial crisis and an exaggerated recession, it carried a yield appeal and was labeled a reserve currency by central banks (later caught on to by the IMF). However, a critical aspect of this perfect façade is starting to crumble – expectations that the Bank of Canada (BoC) is on pace to hike rates well before its counterparts and sometime this year. Governor Carney backed off of his volatile language weeks ago, and now FX and rates traders are looking for evidence as to where the central bank will fully abandon its tightening hopes. In the week ahead, we have plenty of data to crunch including housing prices, trade figures, wholesale and retail sales figures. Of greatest interest though is the CPI data well below target.

Australian Dollar: Rising 10-Year Yields May Reflect Falling Foreign Demand

Equity indexes have held fast to their highs while the same market’s volatility measure is anchored to five-year lows. Sentiment is elevated and fear is all-but absent according to these closely-watched measures. And yet, the highest yielding of the major currencies – the Aussie dollar – had a mixed week. This is yet another, running measure of the ‘quality’ of sentiment; but it also carries an element of the Australian currency’s own position in the risk spectrum. The inflow of capital seeking higher yield of AAA-assets and Europe haven flows amongst other sources seems to be reversing current. The yield on the 10-year government bond is at May highs – which suggests demand is dropping.

Gold Suffers Critical, Bearish Break as G20 Take Up FX Competition

Gold has found itself in a general bear trend for the past four months, but 2013 was developing a level of stability for the troubled metal – until this past week. Following a virtually unchanged performance through the period ending on the 8th, gold suffered a hefty 3.4 percent plunge through this most recent week. That is the biggest decline on that time frame since June – when the market was consolidating at the now 18-month range floor. The bearish trend mirrors the dollar’s climb closely. However, this past week’s – and particularly Friday’s massive 1.5 percent tumble – doesn’t find much support in the FX world. This particularly push likely comes in response to the G20’s likely adoption of a pact not to competitively devalue their exchange rates. It is interesting that eased pressure on deficit reduction was outweighed as a currency/gold balance.

**For a full list of upcoming event risk and past releases, go to www.dailyfx.com/calendar

ECONOMIC DATA

GMT

Currency

Release

Survey

Previous

Comments

21:30

NZD

Performance Services Index (JAN)

51.5

The manufacturing report sparked a significant, kiwi rally

0:01

GBP

Rightmove House Prices (MoM)

0.20%

Large swings in data set: 5 yr. avg.: 0%, high: 4.1%, low: -3.3%

0:01

GBP

Rightmove House Prices (YoY)

2.40%

Stable upward trend over last 17 months, avg. of 1.7%

0:30

AUD

New Motor Vehicle Sales (MoM)

2.20%

Volatile growth, between 10.7% and -10.1% over last 3 years

0:30

AUD

New Motor Vehicle Sales (YoY)

17.90%

Upward trend since -14.8% on 5/11, 2 yr. high of 22.3% on 5/12

6:00

JPY

Machine Tool Orders (YoY)

-26.1%

Sharp downward trend since 3/10 high of 262%, 6-mth. avg.:-14.5%

9:00

EUR

Euro-Zone Current Account n.s.a. (euros)

19.8B

Volatile upward trend, previous month 2nd highest level in 5 yrs.

9:00

EUR

Euro-Zone Current Account s.a. (euros)

14.8B

Upward trend since 12/10, 13 months straight positive

GMT

Currency

Upcoming Events & Speeches

9:00

EUR

ECB’s Nowotny Briefs Journalists

13:00

EUR

Van Rompuy Speaks to EU Parliament on EU Budget Proposal

14:30

EUR

ECB’s Draghi Speaks in Brussels at Quarterly Hearing on ECB

16:30

EUR

ECB’s Draghi at Quarterly Euro Systemic Risk Board Meeting

SUPPORT AND RESISTANCE LEVELS

To see updated SUPPORT AND RESISTANCE LEVELS for the Majors, visit Technical Analysis Portal

To see updated PIVOT POINT LEVELS for the Majors and Crosses, visit our Pivot Point Table

Click Here to Learn 3 Basic Forex Trading Strategies: https://www.youtube.com/watch?v=880UGOQyK40

CLASSIC SUPPORT AND RESISTANCE

EMERGING MARKETS 18:00 GMT

SCANDIES CURRENCIES 18:00 GMT

Currency

USD/MXN

USD/TRY

USD/ZAR

USD/HKD

USD/SGD

Currency

USD/SEK

USD/DKK

USD/NOK

Resist 2

15.5900

2.0000

9.2080

7.8165

1.3650

Resist 2

7.5800

5.8300

6.1150

Resist 1

15.0000

1.9000

9.1900

7.8075

1.3250

Resist 1

6.8155

5.7350

5.8200

Spot

12.6899

1.7670

8.8550

7.7545

1.2371

Spot

6.3222

5.5827

5.5435

Support 1

12.5000

1.6500

8.5650

7.7490

1.2000

Support 1

6.0800

5.4440

5.5000

Support 2

11.5200

1.5725

6.5575

7.7450

1.1800

Support 2

5.8085

5.3350

5.3040

INTRA-DAY PROBABILITY BANDS 18:00 GMT

Currency

EUR/USD

GBP/USD

USD/JPY

USD/CHF

USD/CAD

AUD/USD

NZD/USD

EUR/JPY

GBP/JPY

Resist. 3

1.3476

1.5652

94.70

0.9297

1.0126

1.0389

0.8533

126.91

147.01

Resist. 2

1.3447

1.5619

94.40

0.9277

1.0111

1.0368

0.8513

126.42

146.53

Resist. 1

1.3418

1.5585

94.10

0.9258

1.0095

1.0347

0.8492

125.93

146.05

Spot

1.3360

1.5518

93.50

0.9218

1.0064

1.0305

0.8451

124.96

145.09

Support 1

1.3302

1.5451

92.90

0.9178

1.0033

1.0263

0.8410

123.99

144.12

Support 2

1.3273

1.5417

92.60

0.9159

1.0017

1.0242

0.8389

123.50

143.64

Support 3

1.3244

1.5384

92.30

0.9139

1.0002

1.0221

0.8369

123.01

143.16

v

--- Written by: John Kicklighter, Chief Strategist for DailyFX.com

To contact John, email jkicklighter@dailyfx.com. Follow me on twitter at https://www.twitter.com/JohnKicklighter

Sign up for John’s email distribution list, here.

Additional Content:Money Management Video

Trading the News Video

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
Learn forex trading with a free practice account and trading charts from FXCM.

--

Get stories like this on the Yahoo app and discover more every day.
Download it now.
Loading...
  • US stocks flat as oil shares pressured AFP - 6 minutes ago

    Petroleum-linked shares retreated Wednesday ahead of a US oil inventory report as Wall Street stocks opened little-changed in sluggish trade. Shares of Dow members ExxonMobil and Chevron dipped with oil ... … More »

  • Markets Right Now: US stocks open lower Associated Press - 6 minutes ago

    The latest on developments in global financial markets (all times local): 9:35 a.m. Stocks are opening slightly lower on Wall Street as the market gives back a modest gain from the day before. Mining and ... … More »

  • Wall Street opens little changed as investors eye Fed
    Wall Street opens little changed as investors eye Fed Reuters - 16 minutes ago

    REUTERS - U.S. stocks were little changed at the open on Wednesday as investors kept up their wait for Federal Reserve Chair Janet Yellen's speech on Friday for clues on the timing of an interest rate ... … More »

  • Iran yet to decide on OPEC limits: ministry source AFP - 27 minutes ago

    Iran has yet to take any decision on whether to set a ceiling on oil production or take part in a planned OPEC meeting in Algeria, an oil ministry source told AFP Wednesday. "It is too early to talk ... … More »

  • Cnooc Posts 1st Half-Year Loss on Canadian Oil Sands Charge (3) Bloomberg - 51 minutes ago

    Prices have whipsawed this year, flipping five times between bear and bull markets, as production from nations outside the Organization of Petroleum Exporting Countries, including China and the U.S., declines in the wake of a price crash that began … More »

  • EU warns Greece statistics row 'dangerous' for bailout Reuters - 1 hour 16 minutes ago

    BRUSSELS/ATHENS (Reuters) - The European Union called on Greece on Wednesday to quash what Brussels said were false accusations the Greek statistics agency rigged data to help foreign creditors and warned that the row posed risks to Athens' current … More »

  • Glencore’s Worst Profit Shows Miners Still Reeling From Crisis Bloomberg - 1 hour 17 minutes ago

    Weak raw-material prices caused profit at the commodities giant to plunge 66 percent in the first half to $300 million. The shares slumped as much as 6 percent in London, the most in two months, even as Glencore promised to cut debt even further … More »

  • New trade deal with Britain may take time, Norwegian minister says Reuters - 1 hour 41 minutes ago

    Norway wants to maintain a good relationship with Britain after it leaves the European Union but it may take a long time for a new trade agreement to be established, the EU affairs minister in Oslo said on Wednesday. Elisabeth Aspaker told a … More »

  • Qatari state fund buys stake in NY's Empire State Building
    Qatari state fund buys stake in NY's Empire State Building Associated Press - 1 hour 42 minutes ago

    Qatar's sovereign wealth fund has made an iconic purchase in America — a stake in the company that owns New York's Empire State Building. The $622-million purchase by the Qatar Investment Authority comes ... … More »

  • European stocks rebound as euro slips, U.S. curve flattens
    European stocks rebound as euro slips, U.S. curve flattens Reuters - 1 hour 46 minutes ago

    European stocks edged towards consecutive daily gains for the first time in three weeks on Wednesday, drawing support from a weak euro as investors moved to price in a U.S. interest rate rise, boosting the dollar. The earlier mood was more … More »

  • WPP sees signs of post-Brexit recovery in British ad market
    WPP sees signs of post-Brexit recovery in British ad market Reuters - 1 hour 49 minutes ago

    WPP (WPP.L), the world's largest advertising group, reported a better than expected jump in first-half net sales and said its British operations showed signs in July of a "post-Brexit recovery", sending its shares to a record high. Run by … More »

  • Gold steady as investors await U.S. rate clues
    Gold steady as investors await U.S. rate clues Reuters - 1 hour 50 minutes ago

    Gold held steady on Wednesday as investors took to the sidelines ahead of a speech by Federal Reserve Chair Janet Yellen this weekend which will be closely watched for further clues on U.S. interest rate policy. Yellen is scheduled to address a … More »

  • Exclusive - German ratings firm Scope seeks ECB recognition Reuters - 1 hour 50 minutes ago

    German rating firm Scope says it is in talks to become one of the European Central Bank's recognised sovereign credit agencies, though tough requirements mean the process could take at least three years. Scope would become the first agency based in … More »

  • Oil prices drop as market tracks US supplies AFP - 1 hour 51 minutes ago

    Oil prices fell Wednesday, with Brent stuck below $50, after data showed an increase in US crude stockpiles, adding to supply glut concerns. Data from the American Petroleum Institute (API) Tuesday showed ... … More »

  • U.S. oil falls 2 percent on surprise build in crude stocks
    U.S. oil falls 2 percent on surprise build in crude stocks Reuters - 1 hour 55 minutes ago

    U.S. oil prices fell more than 2 percent on Wednesday on an unexpected increase in U.S. crude stocks that revived worries about the supply glut that has capped prices for the past two years. Industry data from the American Petroleum Institute (API) … More »

  • U.S. oil falls 2 pct on surprise build in crude stocks
    U.S. oil falls 2 pct on surprise build in crude stocks Reuters - 2 hours 1 minute ago

    U.S. oil prices fell more than 2 percent on Wednesday on an unexpected increase in U.S. crude stocks that revived worries about the supply glut that has capped prices for the past two years. Industry data from the American Petroleum Institute (API) … More »

  • Buba's Dombret says eyes LSE-Deutsche Boerse merger with some concern Reuters - 2 hours 20 minutes ago

    Bundesbank board member Andreas Dombret said he was concerned the planned $29 billion (21.89 billion pounds) merger between German exchange operator Deutsche Boerse and the London Stock Exchange may raise systemic risks in derivatives clearing. … More »

  • PetroChina profit almost wiped out in first half
    PetroChina profit almost wiped out in first half AFP News - 2 hours 25 minutes ago

    China’s biggest oil producer PetroChina's net profit plunged 97.9 percent in the first half of this year, it said Wednesday, as it struggled with a weak domestic economy and low oil prices. Net profit was 531 million yuan ($79.9 million) in the … More »

  • European equities mainly rise on German GDP
    European equities mainly rise on German GDP AFP News - 2 hours 27 minutes ago

    European stock markets mostly rose on Wednesday, shrugging off a largely downbeat session in Asia, with sentiment partly lifted by German economic growth data. Strong foreign trade and buoyant consumption drove Germany's economy, Europe's largest, … More »

  • Malaysian oil service provider Perisai in talks with bondholders Reuters - 2 hours 34 minutes ago

    Malaysian oil and gas service provider Perisai Petroleum Teknologi on Wednesday said it has started talks with holders of its S$125 million ($92.36 million) bond maturing on Oct. 3. Perisai said its interest cover ratio had fallen below the … More »

  • Angry Birds maker Rovio turns a profit, plans movie sequel
    Angry Birds maker Rovio turns a profit, plans movie sequel Reuters - 2 hours 35 minutes ago

    Finnish mobile game and animation maker Rovio Entertainment Ltd said on Wednesday it made a profit in the first half of the year and was planning a sequel to its successful Angry Birds Movie. Rovio's adjusted operating profit in the first six … More »

  • Philippines' Duterte says willing to allow online gambling resumption Reuters - 2 hours 37 minutes ago

    Philippine President Rodrigo Duterte said on Wednesday he's willing to allow a resumption of online gambling in the Southeast Asian nation if correct taxes are paid and gaming parlours are far from schools and churches. The new president added … More »

  • German banks right to charge for accounts - Bundesbank's Dombret Reuters - 2 hours 46 minutes ago

    German banks are right to consider current account fees to counter low central bank rates, but an outright charge on deposits, as pioneered by a few lenders, is unlikely to become common, Bundesbank board member Andreas Dombret told Reuters. While … More »

  • EU, Portugal agree on recapitalisation for bank CGD Reuters - 2 hours 59 minutes ago

    The European Commission said it had reached an agreement in principle with Portugal over the recapitalisation on market terms of Portuguese state-owned bank Caixa Geral de Depositos - the country's largest lender. Under the terms of the deal, … More »

  • EU says Greek debt statistics not manipulated in 2010-2015
    EU says Greek debt statistics not manipulated in 2010-2015 Reuters - 3 hours ago

    The European Union's Employment Commissioner Marianne Thyssen said on Wednesday the Greek statistics office did not manipulate data on the country's debt in 2010-2015 and that she had sent a letter to Athens asking it to refute any such suggestions. … More »

 
Recent Quotes
Symbol Price Change % Chg 
Your most recently viewed tickers will automatically show up here if you type a ticker in the "Enter symbol/company" at the bottom of this module.
You need to enable your browser cookies to view your most recent quotes.
 
Sign-in to view quotes in your portfolios.

MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    0.1290.0000.00%
    N21.SI
    0.250.00-1.96%
    5ME.SI
    0.60+0.04+6.57%
    5TP.SI
    0.99-0.02-1.98%
    Y92.SI
    0.156+0.007+4.70%
    AFC.SI
  • % Gainers
    % Gainers
    NamePriceChange% Chg
    0.30+0.06+22.45%
    T18.SI
    0.15+0.02+15.38%
    5TI.SI
    0.225+0.025+12.50%
    Y35.SI
    0.51+0.05+12.09%
    BHU.SI
    0.162+0.017+11.72%
    QS9.SI
  • % Losers
    % Losers
    NamePriceChange% Chg
    0.011-0.115-91.27%
    QF6.SI
    0.23-0.17-42.50%
    AWI.SI
    0.205-0.055-21.15%
    I06.SI
    0.45-0.10-18.18%
    BFK.SI
    0.385-0.085-18.09%
    E8Z.SI

Market Data

  • Currencies
    Currencies
    NamePriceChange% Chg
    1.3540+0.0027+0.20%
    USDSGD=X
    1.5256-0.0014-0.09%
    EURSGD=X
    1.7942+0.0115+0.65%
    GBPSGD=X
    74.1020-0.007-0.01%
    SGDJPY=X
    5.7240-0.0115-0.20%
    SGDHKD=X
    2.9829+0.0071+0.24%
    SGDMYR=X
    9,783.5176-33.1865-0.34%
    SGDIDR=X
    4.9142+0.0008+0.02%
    SGDCNY=X
    1.0328+0.0039+0.38%
    AUDSGD=X
  • Commodities
    Commodities
    NamePriceChange% Chg
    1,332.40-13.70-1.02%
    GCZ16.CMX
    18.64-0.29-1.52%
    SIU16.CMX
    101.29-2.60-2.50%
    ^XAU
    2.10-0.01-0.69%
    HGU16.CMX
    47.60-0.50-1.04%
    CLV16.NYM
  • Bonds
    Bonds
    TreasuryYield (%)Yield Change
    1.13-0.01
    ^FVX
    1.550.00
    ^TNX
    2.23-0.01
    ^TYX