Articles

Fed’s Clarida: Fed won’t tighten solely because unemployment falls

April 15, 2021 03:56   FXStreet   Market News  

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Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.

Opinions expressed at FXStreet are those of the individual authors and do not necessarily represent the opinion of FXStreet or its management. FXStreet has not verified the accuracy or basis-in-fact of any claim or statement made by any independent author: errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website, by FXStreet, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. FXStreet will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.

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Forex Today: Dollar’s sell-off intensifies

April 15, 2021 03:49   FXStreet   Market News  

What you need to know on Thursday, April 15:

 The greenback kept falling with commodity-linked currencies outperforming their European rivals against the American dollar. EUR/USD neared the 1.2000 threshold, while GBP/USD was unable to recover beyond the 1.3800 threshold.

The AUD/USD pair surged to 0.7737 while the USD/CAD fell to 1.2536, giving up some pips before the end of the day but retaining most gains.

US Federal Reserve chief Jerome Powell repeated his well-known conservative stance. He repeated that it is highly unlikely that the Fed would raise rates before the end of 2022,  adding that the US economy is at an inflexion point and heading “a period of faster growth, more job creation.”

Christine Lagarde, President of the European Central Bank, said that the United States’ fiscal response is expected to lift the European growth by 0.3% over the medium term, adding that “US spillover on Europe’s inflation to be 0.15%.”

Crude oil prices were the start of the day, as WTI surged above $63.00 a barrel after the EIA reported a thirds straight weekly draw in crude oil inventories. The news came after an optimistic IEA report and following OPEC upward review to future demand.

Gold prices retreated from weekly highs, with spot ending the day in the red at $ 1,736 a troy ounce.

US indexes rallied at the daily opening, reaching fresh all-time highs, although the three major indexes retreated ahead of the close, ending the day mixed near their opening levels.

US Treasury yields fell to fresh weekly lows before bouncing some during US trading hours, ending the day little changed.

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: BTC, ETH, and XRP stall at significant Fibonacci levels

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AUD/USD Forecast: Bullish breakout hints further gains ahead

April 15, 2021 03:45   FXStreet   Market News  

AUD/USD Current Price: 0.7727

  • Australian Westpac Consumer Confidence printed at 6.2% in April up from 2.6% previously.
  • Australia to publish March employment data, with 35K new jobs expected to have been added.
  • AUD/USD turned bullish in the near-term and could keep rallying in the upcoming sessions.

Commodity-linked currencies outperformed their European rivals against the greenback, with AUD/USD rallying to 0.7737, a fresh April high. Crude oil prices were the initial trigger, as WTI jumped to above $ 63.00 a barrel following an encouraging EIA report, which showed a third straight week of crude draw. The headline spurred risk appetite, sending US indexes to unexplored territory.

Australian data was supportive of the local currency as April Westpac Consumer Confidence printed at 6.2%, up from 2.6% in the previous month. This Thursday, the country will publish April Consumer Inflation Expectations, previously at 4.1%, and March employment figures. The country is expected to have added 35K new jobs in the month, while the unemployment rate is seen down to 5.7%.

AUD/USD short-term technical outlook

The AUD/USD pair holds on to gains trading near the mentioned high, facing the next resistance at 0.7770. Once above the level, the path opens for a steeper advance. The 4-hour chart shows that the pair has sharply advanced beyond its 200 SMA for the first time in almost a month, while the 20 SMA slowly gains bullish traction well below the longer one. Technical indicators eased just modestly from intraday highs, holding near overbought readings, a sign of prevalent buying interest.

 Support levels: 0.7710 0.7690 0.7640

Resistance levels: 0.7770 0.7820 0.7860

View Live Chart for the AUD/USD

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GBP/USD Forecast: No follow-through beyond 1.3800

April 15, 2021 03:45   FXStreet   Market News  

GBP/USD Current price: 1.3781

  • Concerns related to the AstraZeneca vaccine keep undermining sterling.
  • UK reopening plans could be altered by a delay in UK’s vaccination.
  • GBP/USD advanced on the broad dollar’s weakness, but bulls are still reluctant.

The GBP/USD pair peaked at 1.3808 at the beginning of the day but turned south and bottomed at 1.3750. There was no particular catalyst behind such a decline but persistent concerns surrounding the AstraZeneca coronavirus vaccine. The UK is considering not using it in people under 30 years, which may delay the country’s reopening plans. Additionally, soft GBP figures released on Tuesday supported the idea of a slower economic comeback in the country.

 Broad dollar’s weakness saved the day for GBP/USD, which bounced back during the American afternoon to settle a handful of pips below the 1.3800 threshold. The UK won’t publish relevant macroeconomic data this Thursday.

GBP/USD short-term technical outlook

The GBP/USD pair has managed to post a daily advance, although it is still unable to storm through the 1.3800 level. The 4-hour chart shows that the pair ended the day above a bearish 100 SMA, while the 20 SMA advances below it. However, the Momentum indicator eases within positive levels while the RSI is directionless around 54. Overall, the risk seems skewed to the upside, but the pair needs to clear the immediate resistance level at 1.3815 to have better chances of rising.

 Support levels: 1.3750 1.3700 1.3665

Resistance levels: 1.3815 1.3860 1.3905

View Live Chart for the GBP/USD

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US’s Blinken: US takes Iran enrichment move very seriously

April 15, 2021 03:40   FXStreet   Market News  

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer.

Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.

Opinions expressed at FXStreet are those of the individual authors and do not necessarily represent the opinion of FXStreet or its management. FXStreet has not verified the accuracy or basis-in-fact of any claim or statement made by any independent author: errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website, by FXStreet, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. FXStreet will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.

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USD/JPY Forecast: Under pressure, may test 108.00

April 15, 2021 03:40   FXStreet   Market News  

USD/JPY Current price: 108.93

  • US Treasury yields fell to fresh weekly lows, stocks rallied to record highs.
  • BOJ’s Governor Kuroda set to speak again early on Thursday.
  • USD/JPY trading sub-109.00 with increased bearish potential.

The USD/JPY pair fell to a fresh April low of 108.74, maintaining its sour tone. The pair spent most of the American session consolidating just below the 109.00 level, ignoring intraday gains in equities. Instead, investors kept an eye on government bond yields. The yield on the 10-year Treasury note fell to 1.611%,  to end the day unchanged around 1.64%.

Japan released February Machinery Orders, down by 8.5% MoM and fell 7.1% YoY, much worse than the expected advances. Also, Bank of Japan Governor Haruhiko Kuroda offered a speech, but he repeated his usual stance of maintaining an ultra-loose policy to achieve the 2% inflation target. The country won’t publish relevant macroeconomic figures, although BOJ’s Governor Kuroda is scheduled to speak this Thursday.

USD/JPY short-term technical outlook

The USD/JPY pair is under pressure and could extend its decline during the upcoming sessions.  The 4-hour chart shows that the price is developing just below its 200 SMA, after breaking below the shorter ones earlier in the week. The 20 SMA heads firmly lower below the 100 SMA, indicating increased selling interest. Meanwhile, technical indicators remain within negative levels, without clear directional strength.

Support levels: 108.65 108.30 108.00

Resistance levels: 109.20 109.60 110.00

View Live Chart for the USD/JPY

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EUR/USD Forecast: Risk appetite underpins the shared currency

April 15, 2021 03:35   FXStreet   Market News  

EUR/USD Current Price: 1.1972

  • Risk appetite dominated the financial board and put further pressure on the greenback.
  • US Fed’s chair Jerome Powell reiterated his well-known stance of holding back rate hikes.
  • EUR/USD trades at fresh April highs may correct lower in the near-term.

The EUR/USD pair neared 1.2000 this Wednesday, as Wall Street rallied to record highs, with risk-appetite weighing on the greenback. Comments from US Federal Reserve chief Jerome Powell who repeated his well-known conservative stance. He repeated that it is highly unlikely that the Fed would raise rates before the end of 2022,  adding that the US economy is at an inflexion point and heading “a period of faster growth, more job creation.”

The EU published February Industrial Production, which contracted 1% MoM and fell by 1.6% YoY.  The US released the March Import Price Index, which rose 1.2% MoM and the Export Price Index for the same month that was up by 2.1%, both beating the market’s expectations. On Thursday, Germany will publish the final version of March inflation figures, while the US will release March Retail Sales, Initial Jobless Claims and the Philadelphia Fed Manufacturing Survey.

EUR/USD short-term technical outlook

The EUR/USD pair trades in the 1.1970 price zone, up for a third consecutive day. The near-term picture keeps favoring the upside, although the bullish potential remains limited. The 4-hour chart shows that the pair is developing well above a bullish 20 SMA, which crossed above the longer ones. Technical indicators are retreating from overbought readings but hold well above their midlines. A corrective decline could extend down to the 1.1910 price zone, but as long as the pair holds above such a level, the risk will remain skewed to the upside.

Support levels: 1.1950 1.1910 1.1870  

Resistance levels: 1.2000 1.2045 1.2090

View Live Chart for the EUR/USD

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Top 3 Price Prediction Bitcoin, Ethereum, Ripple: BTC, ETH, and XRP stall at significant Fibonacci levels

April 15, 2021 03:17   FXStreet   Market News  

  • Bitcoin price stalls at the 361.8% Fibonacci extension of 2017-2018 bear market.
  • Ethereum price fails at the 138.2% extension of February correction.
  • XRP price welcomes bullish news role.

The listing of Coinbase today under the NASDAQ ticker symbol COIN is not only a watershed moment for the company but an essential step for mainstream investors who are skeptical about directly buying digital currencies but may be convinced to own the market through a Securities and Exchange Commission approved central exchange that handles the transactions.

A more stable trading experience will permit investors to hedge their bets on the future proliferation of cryptocurrencies with a well-placed company that will earn trading revenues that are not directly impacted by the price swings of any one token.

Institutional investors and analysts such as Dan Ives from Wedbush marvel at the opportunity to own the “foundational piece of the crypto ecosystem.” Coinbase is viewed as the gauge for the adoption of not only Bitcoin but also the entire cryptocurrency complex moving forward.

The Co-founder and current CEO, Brian Armstrong, envisions something bigger for Coinbase.

To increase economic freedom in the world. Everyone deserves access to financial services that can help them build a better life for themselves and their families.

From a broader perspective, the Coinbase listing appears to be a win-win situation for individual and institutional investors and the people seeking financial freedom from the current system.

Bitcoin price may rally to $67,650 before a deep correction

The unfolding price structure continues to take the form of a rising wedge pattern with one more touch of the upper trendline needed to complete the pattern. It would represent a marginal new high for the flagship cryptocurrency near $67,650, but first is the unfolding test of the 361.8% extension of the 2017-2018 bear market at $63,777.

BTC/USD daily chart

BTC/USD daily chart

If the current rally fails before testing the wedge’s upper trend line, BTC will find support at the lower trend line at $57,600, followed by the 50-day simple moving average at $55,277.

The incremental support continues to the March low at $50,305 and then the 100-day SMA at $47,770, before a final test of the February low at $43,016.

Ethereum price may be looking for a run similar to 2017

It has been 16 days since the breakout from a symmetrical triangle breakout. The path has included the battle with the February high’s magnet effect and now the successful close above the 161.8% Fibonacci extension of the 2018 bear market at $2,247.

The current outlook anticipates a continuation of ETH strength to the 161.8 extension of the February correction at $2,504, followed immediately by the triangle’s measured move target of $2,507.

Once the current Fibonacci resistance cluster is cleared, ETH could rally to the 261.8% extension of the February correction at $3,253 and even the 261.8% extension of the 2018 bear market at $3,587.

ETH/USD daily chart

ETH/USD daily chart

A big negative for the ongoing rally is the absence of heavy volume. For most positive days, the volume has got to average and no more. This could impede ETH as it wrestles with the current Fibonacci resistance.

XRP price stalls at psychologically important $2

It has been a stream of bullish news for Ripple over the last few weeks. The newest is the cross-border remittances cryptocurrency executives filing to dismiss the SEC case hanging over XRP since December 2020.

XRP price action reflects the bullishness with an explosive advance over the last weeks that has lifted it near the 61.8% retracement of the 2018-2020 bear market at $2.08. With the daily chart flashing a mild bearish momentum divergence, speculators need to prepare for a pause to release some of the price compression generated by the wicked advance.

Following the consolidation, it is anticipated that XRP will challenge the 78.6% retracement at $2.617 before launching a test of the all-time at $3.30 over the medium term.

XRP/USD daily chart

XRP/USD daily chart

XRP has traveled a long distance in a short time, and speculators need to be mindful of critical support at the 38.2% retracement of the April rally at $1.42 and then the 50% retracement at $1.26.

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Preview: Economists are expecting a strong March retail sales report. Why it might be even stronger

April 15, 2021 03:05   Forexlive Latest News   Market News  

Preview of the March 2021 US retail sales report

US retail sales report chart

There are two options for the March US retail sales report: Strong and stronger.

That’s because the US Treasury sent out $1400 stimulus payments to the majority of Americans in the month. It was also a month where the economy continued to reopen as states loosened lockdowns.

The main question is how much of the money was spent immediately, how much bled over to April and how much was saved? The stimulus bill wasn’t signed until March 11 and it took some time to distribute the funds.

It’s a tough one for economists to estimate and that’s reflected in estimates ranging from +3.8% (JPMorgan) to +11.5% (BofA). What’s interesting is that both those economist teams have access to credit card spending data from their banks.

In the earnings call today, JPM executives highlighted that people were saving more of the payments than they anticipated.

JPM credit card spending chart

The top-ranked economist team over the past year on retail sales is at TD and they see 8.5% while the overall consensus is 5.8%. Note though that the average skews higher at 6.3%.

Economist Christophe Barraud looks to the January stimulus payments for guidance. Even though they were less, at $600, they led to a 7.6% m/m rise in retail sales.

He notes that weather was another positive factor with temperatures well-above average and precipitation slightly below average.

Barraud believes sales will ‘smash’ estimates in part due to auto sales, which were up 13.3% m/m.

So what will the market do? I think USD/JPY is the most-straightforward trade in FX with a strong number leading to gains in the pair. Even on a big beat though, the move might not be huge because it’s a one-off event.

As always, watch the ‘control group’ which excludes autos, gasoline and building materials. It’s forecast to rise 7.2% following the 3.5% decline in February.

Invest in yourself. See our forex education hub.

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WTI crude oil futures settle at $63.15

April 15, 2021 03:02   Forexlive Latest News   Market News  

Up $2.97 or 4.94%

The price of WTI crude oil futures soared in trading today. The price settled at $63.15. That was up $2.97 or 4.94%. The high price reached $63.44. The low price was down at $60.38

Up $2.97 or 4.94%_
The pair was higher earlier in the day after breaking above a topside pennant trendline late yesterday, and got shot higher after inventory data this week showed a sharp reduction. The breakout of the up and down trading range going back to March, and a more recent up and down range (see red boxes) gave the buyers the clue to run with the move higher. Standing above $62.25 is now a support level. On the topside the next target comes in at a swing area between $63.58 and $63.80.
Invest in yourself. See our forex education hub.

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Fed’s Williams: Economy is still quite far from maximum employment

April 15, 2021 03:02   FXStreet   Market News  

New York Federal Reserve President John Williams said on Wednesday that the US economy will be able to get back to full strength despite unknowns, as reported by Reuters.

Additional takeaways

“Increased COVID-19 vaccinations and stronger business activity may limit long term economic damage.”

“Economy is still quite far from maximum employment.”

“Inflation is going to be volatile but I expect it to stay relatively subdued near the 2% goal.”

Market reaction

The US Dollar Index largely ignored these comments and was last seen losing 0.15% on a daily basis at 91.68.

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USD/JPY extends sideways grind around 109.00

April 15, 2021 02:56   FXStreet   Market News  

  • USD/JPY is struggling to make a decisive move on Wednesday.
  • US Dollar Index remains on track to post its lowest daily close since March 18.
  • 10-year US Treasury bond yield is up more than 1%.

After closing the first two trading days of the week in the negative territory, the USD/JPY pair turned quiet and continues to fluctuate in a relatively tight range on Wednesday. As of writing, the pair was down 0.08% on a daily basis at 108.96.

DXY falls for the third straight day

Despite the broad-based selling pressure surrounding the greenback, USD/JPY’s losses remain limited on the day as the modest rebound witnessed in the US Treasury bond yields make it difficult for the JPY to find demand. Currently, the benchmark 10-year US T-bond yield is up 1.1% at 1.634%. 

On the other hand, the US Dollar Index, which touched its lowest level in nearly four weeks at 91.57 earlier in the day, is consolidating its losses at 91.66 and remains on track to post its worst daily close since March 18.

The only data from the US showed on Wednesday that the Import Prive Index jumped to 6.9% on a yearly basis in March from 3% in February but this reading failed to trigger a meaningful market reaction.

Meanwhile, FOMC Chairman Jerome Powell reiterated that it was “highly unlikely” for the Fed to start raising rates before the end of 2020 but added that the decision on rates was “outcome-based.”

In the early trading hours of the Asian session on Thursday, Bank of Japan (BoJ) Governor Haruhiko Kuroda will be delivering a speech. Later in the day, weekly Initial Jobless Claims, Retail Sales and Industrial Production data will be featured in the US economic docket.

Technical levels to watch for

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