Analyst Articles – Forex News 24

Dollar, Euro, Pound and Gold Price Charts to Watch Next Week
Recovery from 2019 Low Faces Critical Test
Dollar May Rise if Soft US GDP Data Spooks the Markets
Bitcoin (BTC) Price Slumps on Bitfinex-Tether Fraud Allegations
Swedish Krona Hungover After Riksbank Signaled Delayed Rate Hike
Can Amazon Leverage More Nasdaq and Risk Rally, Will GDP Run the Dollar?
NZD/USD Downtrend Pauses, 3M Job Cuts Sink Dow Jones, JPY May Gain
Will US GDP Stoke Currency Volatility Across USD Forex Pairs Tomorrow?
US Dollar Price Action Setups After 2019 Highs: Gold Price, EUR/USD
EURUSD Rate Remains Under Pressure Following Dovish ECB Bulletin

Dollar, Euro, Pound and Gold Price Charts to Watch Next Week

Posted: 26 Apr 2019 04:50 AM PDT

The US Dollar Index (DXY) broke out last week but may face some opposition to start next week. EURUSD and GBPUSD are both trading weak but don't be surprised if strength turns things around for a bit before selling off again. Gold is holding an important intermediate-term trend-line but still has headwinds keeping price tentatively bearish as a new set of sessions arrives.

Technical Highlights:

DXY index in breakout territory but may get tested
EURUSD and GBPUSD have bounce potential, but looking lower
Gold holding onto trend-line support but has work to do

See where our team of analysts see your favorite markets and currencies headed in the in the DailyFX Trading Forecasts.

DXY index in breakout territory but may get tested

The DXY broke out this week and with that I will run with the breakout for as long as price doesn't close back down below 9770. We may see a test, though, with some of the major currencies seeing a lift here soon. As written about yesterday regarding USD, the eventual target is for a move to around the 100-mark.

US Dollar Index (DXY) Daily Chart (in breakout territory)

Find out where our analysts see the Dollarheading in the coming weeks based on both fundamental and technical factors – Q2 Dollar Forecast

EURUSD and GBPUSD have bounce potential, but looking lower

The Euro has some underlying trend-line support in the vicinity to be mindful of and on that we could see a bit of a bounce. The tendency has been for EURUSD to make new lows and then bounce, so this combination does create upside risk. However, a drop below 11000 and things could really start rolling downhill.

Find out where our analysts see the Euro heading in the coming weeks based on both fundamental and technical factors – Q2 Euro Forecast

EURUSD Daily Chart (has support lines to be aware of)

GBPUSD put in a tiny reversal day yesterday after breaking the descending wedge pattern. A retest of the 12960-area makes for a sweet-spot from a risk/reward perspective to see another leg lower unfold into the 12700s or worse.

Find out where our analysts see the Pound heading in the coming weeks based on both fundamental and technical factors – Q2 GBP Forecast

GBPUSD Daily Chart (12960 ideal spot for fresh shorts)

Bonus Chart: GBPNZD Daily (Wedge becoming clear w/time)

Gold holding onto trend-line support but has work to do

Gold is so far holding the August trend-line and doing so despite Dollar strength. But on its own technical merits gold still looks vulnerable. The trend since February is negative but to get things turned back lower in decisive fashion the August trend-line and 1266 need to break.

Find out where our analysts see Gold heading in the coming weeks based on both fundamental and technical factors – Q2 Gold Forecast

Gold Daily Chart (August t-line, 1266 are key)

Resources for Forex & CFD Traders

Whether you are a new or an experienced trader, DailyFX has several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.

—Written by Paul Robinson, Market Analyst

You can follow Paul on Twitter at @PaulRobinsonFX

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2019-04-26 11:30:00

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Recovery from 2019 Low Faces Critical Test

Posted: 26 Apr 2019 02:49 AM PDT

Gold Price Analysis and Talking Points:

Gold Prices Bounce Back as Investors Seek Safe Havens
Gold Technical Analysis | Recovery Faces First Test
Plethora of US data May Dictate Gold

See our quarterly gold forecast to learn what will drive prices throughout Q2!

Gold Prices Bounce Back as Investors Seek Safe Havens

Despite the topside breakout in the USD index, gold prices have managed to stage a slight recovery from its 2019 lows, refraining from making a test of the 200DMA situated at 1250. The slight rebound had stemmed from increased signs of weaker global growth with the likes of South Korea (bellwether for global trade & tech) reported the largest contraction in GDP since the financial crisis (full story), while Germany has also showed little signs of a recovery (full story), which in turn has seen global bond yields drop. Consequently, gold is set to have its first weekly gain in a month.

Gold Technical Analysis | Recovery Faces First Test

Gold prices are set to face its first test with the precious metal edging towards prior trendline support, which is now resistance at $1284, while the 61.8% Fibonacci retracement (2018 peak to 2018 low) at $1287 could also curb further advances. As such, failure to make a decisive break above could see a retest of the 2019 low ($1266) before the 50% Fibo ($1262).

Plethora of US data May Dictate Gold

From here on till next week, there will be a plethora of tier 1 macro data out of the US, which could dictate price action in Gold with US Q1 GDP released today while the FOMC and NFP report will be digested next week.

GOLD PRICE CHART: Daily Time-Frame (Mar 2018-April 2019)

What You Need to Know About the Gold Market

GOLD TRADING RESOURCES:

— Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX

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2019-04-26 09:30:00

Dollar May Rise if Soft US GDP Data Spooks the Markets

Posted: 26 Apr 2019 02:14 AM PDT

TALKING POINTS – US GDP, DOLLAR, JAPANESE YEN

Aussie, NZ Dollars correct higher after hitting four-month lows
First-quarter US GDP data in focus, disappointment risk seen
US Dollar may rise if soft growth drives haven-seeking demand

Currency markets appeared to be in corrective in Asia Pacific trade. The Australian and New Zealand Dollars narrowly outperformed, extending a recovery traced out over the prior session launched after hitting four-month lows. The recently buoyant US Dollar edged modestly lower.

The spotlight now turns to first-quarter US GDP data. It is expected to show that the annualized growth rate ticked up to 2.3 percent in the first three months of 2019, up from 2.2 percent previously. Recent US macro news-flow has mostly lagged relative to forecasts however, warning of incoming disappointment.

A downbeat print is likely to stoke fears about ongoing global slowdown, putting financial markets on the defensive. In the absence of meaningful Fed rate hike prospects, any further dovish in policy bets may be overshadowed by liquidity demand amid de-risking, boosting the Greenback.

The similarly anti-risk Japanese Yen may likewise benefit. It has tracked higher in what looks like pre-positioning for the Golden Week holiday lull. A US GDP print that encourages divestment from JPY-funding carry trades as investors reduce exposure to risky assets may see the rally gain momentum.

What are we trading? See the DailyFX team's top trade ideas for 2019 and find out!

CHART OF THE DAY – US ECONOMIC DATA WEAKER AS GLOBAL GROWTH SLOWS

Citing the relative strength of the US economy has been commonplace among market-watches recently. While the performance of other pace-setting economies – notably the Eurozone and China – has been disappointing by comparison, the US seems far from immune amid the ongoing slowdown in global growth.

The chart shows the pace of worldwide manufacturing- and service-sector growth – as tracked by the JPMorgan Global PMI index – has been slowing since early 2018. Against this backdrop, US economic news-flow has increasingly deteriorated relative to analysts' projections, according to data from Citigroup.

Put another way, economists producing forecasts for US data releases appear to envision far rosier conditions than reality has ratified. What's more, deepening underperformance suggests optimism has been impervious to countervailing evidence so far, setting the stage for further downside surprises.

FX TRADING RESOURCES

— Written by Ilya Spivak, Currency Strategist for DailyFX.com

To contact Ilya, use the comments section below or @IlyaSpivak on Twitter

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2019-04-26 06:30:00

Bitcoin (BTC) Price Slumps on Bitfinex-Tether Fraud Allegations

Posted: 26 Apr 2019 01:38 AM PDT

Bitcoin (BTC) Price, Chart and Analysis:

New York AG Letitia James gunning for Bitfinex and Tether operators
Bitcoin slumps, partially recovers but resistance remains in place.

Bitcoin (BTC) Rattled on USD850 million Exchange Loss Claims

The latest Bitcoin rally ended abruptly Thursday on news that New York Attorney General Letitia James had filed allegations of a cover-up between the operators of cryptocurrency exchange Bitfinex and stable-coin Tether (USDT). The filing notes that 'Bitfinex Struggles to Fill Client Withdrawal Requests Due to Crypto Capital's Loss or Theft of Approximately $850 million.'

Full Filing Here.

The filing also alleges that Bitfinex comingled client and corporate funds, in excess of USD1 billion, through a Panamanian payment company Crypto Capital as the exchange had no bank to work with.

Bitcoin slumpedby 10% as the news hit the wires, spiking below $5,000 before recovering some of its losses. The recent Bitcoin (BTC) rally hit resistance around $5,620, the lower level of an important gap between $5,648 and $6,111, the first upside target. The 'bullish golden cross' that occurred on April 23 turned out to be not such a bullish signal as many thought as prices have fallen ever since. There are a cluster of minor support levels between $4,900 and $5,000 before just below $4,800 comes into play.

IG Client Sentiment Datashows how retail are positioned in a variety of cryptocurrencies. See how daily and weekly positioning can affect our trading bias. Bitcoin (BTC) trade data shows 82.4% of traders are net-long, a bearish contrarian trading bias.

A Guide to Day Trading Bitcoin and Other Cryptocurrencies.

Bitcoin (BTC) Daily Price Chart (October 2018 – April 26, 2019)

Traders may be interested in two of our trading guides – Traits of Successful Traders and Top Trading Lessons – while technical analysts are likely to be interested in our latest Elliott Wave Guide.

What is your view on Bitcoin and Litecoin – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author at nicholas.cawley@ig.comor via Twitter @nickcawley1.

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2019-04-26 08:00:00

Swedish Krona Hungover After Riksbank Signaled Delayed Rate Hike

Posted: 25 Apr 2019 11:48 PM PDT

KRONA, KRONE TALKING POINTS – RIKSBANK RATE DECISION, STEFAN INGVES, EUROPEAN GROWTH

Swedish Krona plunged following the Riksbank rate decision and outlook
Central back pushes back rate hike, continues bond purchasing program
Growing risk out of Europe from slower growth, Brexit growing concern

See our free guide to learn how to use economic news in your trading strategy!

The Swedish Krona and local two-year bond yields plunged following the release of the Riksbank's decision to hold the benchmark rate at -0.25 percent and continue its accommodative policy – as anticipated. Central bank Governor Stefan Ingves announced that the next rate hike will either be at the tail end of 2019 or beginning of 2020. He also alluded to an extension of the bond purchasing program until December 2020.

Ingves stated that unemployment has bottomed out and that the Swedish economy has entered into a "calmer phase" with expectations of inflation reaching close to the Riksbank's two percent target. However, underlying upward pressure is weak, particularly against the backdrop of slower global growth and rising trade tensions between the US and China, Japanand the EU.

Despite dismissing the probability of a global downturn ahead, the uncertainty over Brexit is a growing concern because of its unknown political and economic consequences. This comes as economies in Europe slow down with the ECB turning to new stimulus methods while it struggles to emerge out of negative rate territory.

As an export-driven economy with a heavy reliance on healthy demand out of Europe, waning growth in the EU is a major concern for Swedish policymakers. Indeed, this is particularly so in light of key Eurozone member states showing an alarming amount of weakness. The IMF cut global growth forecasts again – in large part due to ongoing trade wars – leaving less external demand for Swedish goods and undermining the country's exports.

The Riksbank's decision to push back its tightening cycle is part of a broader trend of almost all major central banks pushing back their hiking trajectory in light of growing uncertainty. The Norges Bank is an exception to this – but perhaps not for long. With still so much potential risk in the latter half of the year laying dormant, there is no telling of how the various factors push central banks to delay rate hike expectations further.

Later today, Swedish retail sales and producer prices data are scheduled to be released, though its impact on the Krona may be relatively muted following the Riksbank meeting. Looking ahead, next week is filled with major event risk out of Europe against the backdrop of US trade negotiations. Keeping an eye on these factors will be prudent because of the impact it may have on further delaying the central bank's tightening cycle.

CHART OF THE DAY: USD/SEK, USD/NOK, EUR/SEK 15-MINUTE CHART

NORDIC TRADING RESOURCES

— Written by Dimitri Zabelin, Jr Currency Analyst for DailyFX.com

To contact Dimitri, use the comments section below or @ZabelinDimitrion Twitter

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2019-04-26 06:30:00

Can Amazon Leverage More Nasdaq and Risk Rally, Will GDP Run the Dollar?

Posted: 25 Apr 2019 08:11 PM PDT

Dollar and Nasdaq Talking Points:

Microsoft’s post-earnings surge couldn’t translate into a consistent Nasdaq climb, will Amazon’s Thursday evening beat gain footing?
Trade war headlines continue to offer mixed signals, South Korea tugged serious growth concerns and BOJ did little for monetary policy
Top event risk through week’s end is US 1Q GDP which finds a more willing theme through risk trends than responsive currency

Do you trade on fundamental themes or event risk? See what live events we will cover on DailyFX this week (Friday’s US GDP) as well as our regular webinar series meant to help you hone your trading.

Earnings and US Indices are Losing Their Allure at an Inconvenient Time

In the rotating fundamental themes looking to hold control over the global markets, the US earnings season is still drawing the greatest attention from the speculative gallery. Heading into Thursday’s New York trading session, expectations were set high. The previous day’s corporate readings presented a mixed picture but seemed to leverage promise where it could spur the most interest. The after-hours Microsoft numbers were strong even looking beyond the typical accounting adjustments made to beat tepid expectations. With the market’s leading sector for speculative charge (tech) supported by this titan’s figures and its worst performing major segment (healthcare) warmed by Anthem (ANTM), there was reasonable anticipation that the session was due a rally – but follow through was open to interpretation as liquidity played out. Indeed, the tech-heavy Nasdaq 100 index took advantage of MSFT’s surge; but an opening bullish gap was all the conviction the market would muster. Sentiment would struggle through the rest of the day. And so, we find our selves facing exactly the same scenario heading into this week’s final trading session. After the New York close this past session, another tech earnings boost was offered by the company that regularly competes for the top spot in market capitalization: Amazon (AMZN). The firm’s earnings per share (EPS) handily beat expectations of $4.76 with a print of $7.09. If we were to follow old logic of risk on supplied by key benchmarks, this would set the terms for a strong conclusion to the week.

Chart of Nasdaq Composite and Amazon in Orange (Daily)

Can Amazon Leverage More Nasdaq and Risk Rally, Will GDP Run the Dollar?

Alas, the default risk appetite reach of past years is no longer our status quo. The flimsy response to the MSFT update is a timely reminder of that reality. However, we can find reason for a default skepticism in the more systemic dislocation of risk performance. When risk trends were barreling higher with little concern as to the motivation, tech maintained the lead with a particularly impressive showing from the FANG – large market cap, tech companies. That same grouping is now flagging the Nasdaq. The index is still leading the broader S&P 500 and blue-chip Dow counterparts, so there is still a speculative appetite at play. That said, the gap between US equities and the many other popular risk-leaning assets has not closed with the many laggards advancing under a halo of optimism. Rest of world equities (VEU) has moved lower this week having failed to pass the mid-point of 2018’s collapse. Riskier assets such as emerging markets and junk bonds are sporting similar discount. The more financially in-tuned carry trade (Yen crosses) never jumped aboard while the more growth-linked sovereign yields and commodities are trading as if it has not decided on a direction at all this year. This lack of consistency shows little genuine sentiment and should raise more concern over the individual outperformers than expectations that the rest of the market is due to follow in US indices’ wake.

Can Amazon Leverage More Nasdaq and Risk Rally, Will GDP Run the Dollar?

Trade Wars, Recession Fears and Monetary Policy Themes Into Next Week

Earnings is a theme that will continue into next week with the release of data from the likes of Google, Apple, General Motors, General Electric and Pfizer. Yet, the number of industry leaders for critical systemic themes is clearly going to recede. That will likely see the attention shift from the corporate earnings perspective of fundamental themes to the themes themselves. Traders should be mindful of the other thematic issues that are presently in the backdrop but which could readily come to the foreground with the proper spark – or even the recession of the other key matters. For the general concern over growth (more accurately fears of stalled expansion or outright recession on a global basis), the world’s largest economy is due to print its own 1Q GDP figure in the upcoming session. In the meantime, we have seen steep downgrades to the global growth forecast from the IMF and the WTO. More recent, South Korea – the world’s 12th largest economy (according to the IMF’s figures) and the fourth largest Asian economy – reported a -0.3 percent contraction this past quarter. That was the worst showing for this important economy since the Great Financial Crisis a decade ago. Perhaps even more troubling, capital expenditures collapsed -10.8 percent for the biggest contraction since the Asian Financial Crisis in 1998.

Chart of USDKRW – Dollar-Korean Won Exchange Rate (Daily)

Can Amazon Leverage More Nasdaq and Risk Rally, Will GDP Run the Dollar?

Growth isn’t the only fundamental theme rotating back into the headlines and through market influence. Monetary policy is another matter of substance. The Bank of Japan (BOJ) raised few eyebrows with its monetary policy update Thursday morning, but market participants keeping tabs on the balance influence in the financial system would notice the subtle measure of desperation from a group that is losing its ability to extinguish financial fires. While Governor Kuroda didn’t change the benchmark rate or the terms of the bank’s open-ended stimulus program, he would offer up a tangible time frame on the extremely low interest rates. While he wouldn’t offer a limit on the near-zero rates, he did say they would remain in place at least another year. We’ll see what the Federal Reserve and Bank of England will answer with through their own updates next week. As for trade wars, Japanese leaders continued their week-long visit through Europe and North America. The hosts of the next G-20 summit are making a valiant – but ultimately impotent – effort to encourage global trade during an unmistakable trade war. Japanese Prime Minister Abe is due to meet US President Trump Friday. Speaking of the US, the country’s Trade Representative office announced China’s third largest e-commerce company Pinduoduo.com would be added to the blacklist for intellectual property theft. That seems to contradict the sentiment implied by remarks by Trump that Chinese President Xi will visit soon – presumably to sign a trade agreement.

US 1Q GDP Tops the Economic Docket but Will the Dollar Look Up?

If you are looking for significant market movement among major currencies, the most targeted potential rest with the US Dollar and the release of the 1Q US GDP update. There has been an unmistakable concern over the health of the global economy to the point that fears of recession has readily followed tentative signals such as the US yield curve inversion. Naturally, the health of the world’s largest economy will have carry through for the rest of the globe. The forecast for a 2.2 percent unchanged pace this past quarter from 4Q is a neutral benchmark that can stage a market response should the official report best or disappoint the outlook. The wider the divergence of the official growth update to the consensus forecast, the more significant the market response. That said, will the Dollar establish its next move on the basis of this data…on a Friday? Will global markets and sentiment itself take its cues from this figure? For the Greenback, local data has played little role in directing speculative intent. More influential for the Greenback seems the collective improvement, deterioration or inconsistency of major counterparts. Recently, retreat from the Euro, Pound, Yen and Aussie Dollar at the same time earned the DXY Dollar Index (trade-weighted) and my own equally-weighted measure a break to near two-year highs. That was an effective technical spark, but can it earn a sustained burn?

Chart of S&P 500 and US Advance Quarterly GDP Releases (Daily)

Can Amazon Leverage More Nasdaq and Risk Rally, Will GDP Run the Dollar?

Looking to the other major currencies, we are starting to see the limitations of local fundamental motivation shift out to the future. For the Euro – the second most liquid currency – an equally-weighted measure notably broke lower this past session. There was little in the way of scheduled event risk that could be expected to move the shared currency Thursday and Friday is no different. Looking ahead to the next week, we have the Spanish election and Euro-area 1Q GDP readings on tap, but that is a matter for the week ahead. From the Pound, Brexit is still a hitch but we have released the potency with the next deadline pushed out to to May 22nd (the date by which the UK must signal its intent to participate in the EU Parliamentary election). Cable (GBPUSD) slide further this past session, but the Pound contributed little to this effort. Even the Japanese Yen offered little support to the Dollar’s efforts considering USDJPY actually dropped. The BOJ’s dovish bearings and the Japanese delegations remarks in the West spurred little commitment from the Yen. We should weigh this against traditional risk intent moving forward. We discuss risk trends, systemic themes, the majors and more in today’s Trading Video.

Chart of DXY Dollar Index (Daily)

Can Amazon Leverage More Nasdaq and Risk Rally, Will GDP Run the Dollar?

If you want to download my Manic-Crisis calendar, you can find the updated file here.

2019-04-26 02:37:00

NZD/USD Downtrend Pauses, 3M Job Cuts Sink Dow Jones, JPY May Gain

Posted: 25 Apr 2019 04:56 PM PDT

Asia Pacific Market Open Talking Points

NZD/USD pauses downtrend on resistance after dismal US initial jobless claims
Yen climbs before Golden Week holiday, 3M expected job cuts sink Dow Jones
S&P 500 futures hint downturn in market mood ahead as JPY may extend gains

Trade all the major global economic data live as it populates in the economic calendar and follow the live coverage for key events listed in the DailyFX Webinars. We'd love to have you along.

FX News Thursday

The pro-risk New Zealand Dollar outperformed against its major counterparts on Thursday, even by a greater extent than its similarly-behaving Australian Dollar cousin. Most of its gains occurred in the lead-up to Wall Street market open where an hour before, mixed US economic data crossed the wires. Most notably, initial jobless claims unexpectedly rose 230k this past week versus 200k expected and 193k prior.

That was the largest increase (+19.2%) since September 2017 which ended 5 weeks of consecutive smaller filings for unemployment aid. This seemed to overshadow an uptick in durable goods orders which preliminary estimates point to a 2.7% gain in March from -1.1% in April (see calendar below). At the time of the announcement, the S&P 500, US Dollar and local front-end government bond yields declined.

US Initial Jobless Claims and Durable Goods Orders

*All times listed in GMT

NZD/USD Technical Analysis

Taking a closer look at NZD/USD reveals that its best day in over a month (+0.49%) occurred right on support at 0.6592 on the chart below. This puts a pause in its recent declines within a descending channel going back to late March. As such, technical signals may point to a retest of channel ceiling as the next move. A daily close above 0.6706 (resistance) may confirm a longer-lasting reversal.

NZD/USD Daily Chart

Chart Created in TradingView

The anti-risk Japanese Yen also outperformed, gaining throughout the day. Traders may be unwinding carry positions ahead of the Golden Week holiday where local markets will be closed through May 6. It was an overall mixed day for equities. There was a divergence between the S&P 500 (-0.04%) and the Dow Jones Industrial Average (-0.51%).

Looking at the chart below, this may have been due to a dismal earnings report from 3M Company which is an industrial conglomerate. In fact, industrials weighed heavily against both indexes. In addition to cutting 2019 forecasts, 3M announced that it is expecting to trim 2,000 positions across the world. Shares dropped almost 13 percent in the worst performance since 1987.

3M Drags Down Industrials

Chart Created in TradingView

Friday's Asia Pacific Trading Session

S&P 500 futures are pointing lower heading into Friday's Asia Pacific trading session, hinting of a pessimistic trading environment that may be in store ahead. This may continue bolstering the Japanese Yen. The New Zealand Dollar may weaken on the other hand. Through NZD/USD got a boost after RBNZ Governor Adrian Orr noted that he isn't worried by slower GDP numbers.

FX Trading Resources

— Written by Daniel Dubrovsky, Junior Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter

2019-04-25 23:30:00

Will US GDP Stoke Currency Volatility Across USD Forex Pairs Tomorrow?

Posted: 25 Apr 2019 01:44 PM PDT

USD CURRENCY VOLATILITY – TALKING POINTS:

Overnight implied volatility metrics for major USD currency pairs leaps ahead of Friday's US GDP data release which may potentially stoke a sizable market reaction
The DXY US Dollar Index recently surged above technical resistance to its highest level since May 2017 and could suggest USD traders are expecting tomorrow's GDP numbers to beat estimates
Take a look at this article for information on How to Trade the Top 10 Most Volatile Currency Pairs or download the free DailyFX Q2 USD Forecastfor comprehensive fundamental and technical insight on the US Dollar over the second quarter

Forex traders are starting to see signs that currency volatility could be ticking higher, led by the latest surge in the US Dollar. In fact, recent USD gains has pushed the DXY US Dollar Index above key resistance at the 98.00 price level which is its highest reading in nearly 2 years.

DXY US DOLLAR INDEX 1-MONTH IMPLIED VOLATILITY PRICE CHART: DAILY TIME FRAME (APRIL 24, 2018 TO APRIL 25, 2019)

DXY US Dollar Index Price Chart Implied 30-Day Volatility

Prior to the greenback's latest advance, forex market volatility was seemingly evaporating. But, price action looks to be picking up again judging by rising implied volatility which interestingly aligns with tomorrow's potentially market-moving economic data.

FOREX MARKET IMPLIED VOLATILITIES AND TRADING RANGES

Forex Market Implied Volatility and Trading Ranges USD, JPY, EUR, GBP, AUD, CHF, CAD, NZD Currency Market Implied Volatility EURUSD, USDJPY, GBPUSD, USDCAD, USDCHF, AUDUSD, NZDUSD

Performance in the major USD crosses tomorrow will largely depend on how closely actual Q1 US GDP is reported to consensus. Fed funds futures are currently pricing a 45 percent probability that the Fed will cut interest rates by its December 11 FOMC meeting.

If economic growth comes in above the 2.2 percent estimate, the odds that the Fed lowers its benchmark interest rate will likely drop which usually lifts the US Dollar. On the other hand, if GDP crosses the wires below forecast, markets could begin pricing in a higher likelihood that the Fed cuts rates this year.

FOREX ECONOMIC CALENDAR – USD

Forex Economic Calendar US Dollar Price Chart

Visit the DailyFX Economic Calendar for a comprehensive list of upcoming economic events and data releases affecting the global markets.

Currency pairs of interest highlights EURUSD, USDJPY and AUDUSD. Greenback gains could be limited against the Euro if GDP surprises to the upside considering recent EURUSD price action. On the other hand, there could be more room for the USD to run against the Aussie considering weak inflation out of Australia likely sets up the RBA for a rate cut.

Also, a US GDP beat would likely enhance risk appetite and send traders flocking out of anti-risk currencies like the Japanese Yen, especially given the BOJ's reiterated dovishness. That being said, JPY could see a boost from US GDP coming in below estimates, particularly if the report is bleak enough to reignite market pessimism and flight to 'safe-haven' securities.

TRADING RESOURCES

Whether you are a new or experienced trader, DailyFX has multiple resources available to help you: an indicator for monitoring trader sentiment; quarterly trading forecasts; analytical and educational webinars held daily; trading guides to help you improve trading performance, and even one for those who are new to FX trading.

– Written by Rich Dvorak, Junior Analyst for DailyFX

– Follow @RichDvorakFX on Twitter

2019-04-25 20:05:00

US Dollar Price Action Setups After 2019 Highs: Gold Price, EUR/USD

Posted: 25 Apr 2019 12:30 PM PDT

US Dollar, Gold, EUR/USD Talking Points:

– If you're looking to improve your trading approach, our Traits of Successful Traders research could help. This is based on research derived from actual results from real traders, and this is available to any trader completely free-of-charge.

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US Dollar Breaks Out From Ascending Wedge – Gold Price Gains Go Along

The US Dollar has finally broken out of the ascending wedge formation that's been brewing since last year. But, now the natural next question for traders: What's next?

At this point, the bullish theme in USD has aim for continuation, but in deciphering that, it's important to dial back to the question of drivers. As in, what created this swell of strength in the US Dollar that's finally allowed for bearish breakouts to show in key pairs like EUR/USD and GBP/USD? There wasn't any particularly strong US data that did the pushing, nor did this come from FOMC verbiage. Making matters a bit more interesting is the fact that USD-strength showed-up along with stronger Gold prices and a show of strength in the Japanese Yen, all factors that would point to the potential for risk aversion. In this webinar, I looked through major currency pairs to attempt to dial in to the most pressing themes across macro markets.

US Dollar Breakout Crosses Key Terrain

Yesterday's breakout in USD saw the pair take-out the 97.70 level that had made up resistance in the ascending triangle formation, and bulls continued to push. The 98-level was soon in-play, where exists a couple of longer-term Fibonacci levels, but even that couldn't slow down the advance as buyers pushed all the way until a high was set at 98.32. This can make for a difficult time to chase that fresh breakout, especially considering that today's non-completed Daily bar is showing as a spinning top or a possible Doji.

US Dollar Price – Daily Chart

Chart prepared by James Stanley

This can keep the door open for higher-low support. The area around prior resistance of 97.70 becomes an obvious area to follow. And just above that, around 98, is another potential support zone as taken from two Fibonacci levels.

US Dollar Price Chart – Hourly

Chart prepared by James Stanley

Gold Price Bounces Along with US Dollar Strength

The week started with continued selling in Gold prices, and that theme ran all the way until a bullish trend-line came into play around the 1266 level. That has since helped to hold support, and as the US Dollar breakout started to take-hold yesterday, Gold prices continued to rally from that low.

Gold Price Daily Chart

As of this morning, Gold prices were testing short-term resistance around prior support. This zone runs from 1275.55-1286.38, and this area had previously held up the 2019 lows as a descending triangle formation was building earlier this month. As looked at in the webinar, buyers are now making a forward push to re-claim that support zone, and the fact that this was taking place amidst a backdrop of USD-strength may be saying something.

Gold Price Four-Hour Chart

EUR/USD Bounces from 1.1120, Can Bears Continue to Push?

Going along with that USD breakout is a EUR/USD breakdown. I had looked at this level in an article that I had published for ZeroHedge yesterday, attempting to pick out support levels for the EUR/USD breakout. The price of 1.1120, a swing-low last in-play almost two years ago has helped to hold the low from the breakout. Below current prices, support potential exists around the 1.1075 area, the 1.1000 psychological level and, longer-term, a zone that runs from 1.0814-1.0863.

EUR/USD Price Weekly Chart

Chart prepared by James Stanley

GBP/USD Breakout Catches Support in Key Zone

I've been following the short-side of GBP/USD over the past couple of weeks, looking for a bearish breakout in a descending triangle formation. That breakout has taken-hold this week, and prices have already moved down to the targeted area around the confluent 1.2900 handle. This can make for a difficult time to investigate fresh bearish exposure considering that price action is sitting at two month lows. This can, however, open the door to retracement potential, with prior support from 1.2960-1.3000 re-opening the door for short-side strategies. Below current price action – support potential exists around 1.2829, 1.2783 and, longer-term, a bit zone of potential support from 1.2671 up to 1.2721.

GBP/USD Daily Price Chart

Chart prepared by James Stanley

Yen Strength Shows Up After BoJ

Also in that category of potential signals for oncoming risk aversion: Yen strength. This showed-up after the BoJ rate decision last night, and making matters more interesting is the 'where,' as USD/JPY tested a key area of resistance before showing an aggressive drop. This price is 112.34, and this is the 76.4% retracement of the November 2017 – May 2018 major move. Each of the retracement levels from this study have come into play this week, and the 112.34 price helped to set support for a large portion of Q4 last year. Prices in USD/JPY stalled at this level, and have since started to fall. The door hasn't been closed yet on the bullish theme, but the momentum with which this move priced-in is notable, and should Yen-strength continue to show, that theme of risk aversion would build a bit more.

USD/JPY Price – Daily Chart

Chart prepared by James Stanley

To read more:

Are you looking for longer-term analysis on the U.S. Dollar? Our DailyFX Forecasts for Q4 have a section for each major currency, and we also offer a plethora of resources on USD-pairs such as EUR/USD, GBP/USD, USD/JPY, AUD/USD. Traders can also stay up with near-term positioning via our IG Client Sentiment Indicator.

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If you're looking for educational information, our New to FX guide is there to help new(er) traders while our Traits of Successful Traders research is built to help sharpen the skill set by focusing on risk and trade management.

— Written by James Stanley, Strategist for DailyFX.com

Contact and follow James on Twitter: @JStanleyFX

2019-04-25 19:03:00

EURUSD Rate Remains Under Pressure Following Dovish ECB Bulletin

Posted: 25 Apr 2019 11:16 AM PDT

The near-term rebound in EUR/USD was short-lived, with the exchange rate slipping to a fresh 2019-low (1.1118) as the European Central Bank (ECB) warns that the 'the risks surrounding the euro area growth outlook remain tilted to the downside'

The updates to the ECB's monthly economic bulletin suggest the central bank will continue to support the euro-area as 'the information that has become available since the Governing Council's monetary policy meeting in March confirms slower growth momentum extending into the current year,' and President Mario Draghi & Co. may keep the door open to implement more non-standard measures as the central bank struggles to achieve its one and only mandate for price stability.

Image of ECB economic bulletin

Even though the Targeted Long-Term Refinancing Operation (TLTRO) is set to launch in September, the ECB may have little choice but to endorse a dovish forward-guidance at the next meeting on June 6 as the central bank pledges to 'to adjust all of its instruments, as appropriate, to ensure that inflation continues to move towards the Governing Council's inflation aim in a sustained manner.' In turn, a growing number of ECB may show a greater willingness to introduce a negative interest rate policy (NIRP) as 'incoming data continued to be weak,' and the Euro stands at risk of facing additional headwinds over the near-term as President Draghi & Co. remain reluctant to abandon the easing-cycle.

With that said, it remains to be seen if President Draghi & Co. will continue to endorse a wait-and-see approach ahead of the next quarterly meeting in June as ECB officials insist 'underlying inflation is expected to increase over the medium term,' but recent price action brings the downside targets on the radar for EUR/USD as the exchange rate snaps the opening range for 2019. At the same time, recent developments in the Relative Strength Index (RSI) indicates that the bearish momentum is gathering pace as the oscillator snaps the bullish formation carried over from March.

EUR/USD Rate Daily Chart

There appears to be a broader shift in EUR/USD behavior as the exchange rate threatens the wedge/triangle formation from earlier this year, with the near-term outlook mired by the failed attempt to test the 1.1340 (38.2% expansion) hurdle.At the same time, recent developments in the Relative Strength Index (RSI) offer a bearish signal as the oscillator snaps the upward trend from earlier this year.

In turn, the break/close below the 1.1190 (38.2% retracement) to 1.1220 (78.6% retracement) region brings the 1.1100 (78.6% expansion) to 1.1140 (78.6% expansion) zone on the radar, with the next area of interest coming in around 1.0950 (100% expansion) to 1.0980 (78.6% retracement).

For more in-depth analysis, check out the 2Q 2019 Forecast for the Euro

Additional Trading Resources

Are you looking to improve your trading approach? Review the 'Traits of a Successful Trader' series on how to effectively use leverage along with other best practices that any trader can follow.

Want to know what other currency pairs the DailyFX team is watching? Download and review the Top Trading Opportunities for 2019.

— Written by David Song, Currency Analyst

Follow me on Twitter at @DavidJSong.

2019-04-25 18:02:00