[{"post_url":"https:\/\/psxon.com\/gold-gains-after-feds-dovish-hike-reinforces-bullish-trend-breakout-in-play\/","description":"GOLD PRICE FORECAST: Gold prices rise following the Fed\u2019s dovish hike at its March FOMC meeting The U.S. central bank","date":"March 24, 2023","views":0,"post_id":214,"content":"\nGOLD PRICE FORECAST:\n\nGold prices rise following the Fed\u2019s dovish hike at its March FOMC meeting\nThe U.S. central bank raised rates by 25 basis points, but signaled its tightening cycle is coming to an end\nThe fundamental outlook remains positive for gold\n\n\n\n\nRecommended by                    Diego Colman\n\n\nGet Your Free Gold Forecast\n\n\n\nMost Read: Gold Trading \u2013 Three Top Tips for Trading Gold\nGold prices surged on Thursday amid U.S. dollar weakness after the FOMC delivered a dovish interest rate hike and signaled that its tightening campaign may be nearing its end. In late morning trading, XAU\/USD was rallying about 1% to $1,986, inching ever closer to its 2023 highs, just above the psychological $2,000 level set this past Monday.\nRecent banking sector turmoil has led the Fed to adopt a much more cautious stance and to project a less aggressive hiking cycle than telegraphed just a few weeks ago, when Powell dropped a hawkish bombshell before Congress. In fact, the FOMC only expects to raise borrowing costs one final time this year to 5.00-5.25%, well below the 5.70% peak rate anticipated by the market earlier this month.\nThe idea that the terminal rate is within reach, coupled with growing speculation that the central bank will ease policy shortly thereafter, is likely to be bullish for non-yielding assets, including precious metals. This means that gold could remain in an upward trajectory over the medium term, especially if financial turmoil resurfaces and threatens to create systemic risks.\nIn terms of technical analysis, if gold extends its advance in the coming sessions, the first ceiling to consider appears in the $2,000\/$2,015 region. On further strength and a decisive breakout, the focus shifts to channel resistance at $2,050, followed by $2,078, last year\u2019s high. Conversely, if sellers return and spark a pullback, initial support comes at $1,975\/$1,965. Below that, the next area of interest lies at $1,920 and $1,900 thereafter.\n\n\n\nof clients are net long.    of clients are net short.    \n\n\n\n\n\n\n\n\nChange in        \n\nLongs        \n\nShorts        \n\nOI        \n\n\n\n\nDaily\n-7%\n21%\n4%\n\n\nWeekly\n-2%\n28%\n10%\n\n\n\n\nGOLD PRICE TECHNICAL CHART\n\nGold Futures Chart Prepared Using TradingView\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Gold Gains After Fed\u2019s Dovish Hike Reinforces Bullish Trend, Breakout in Play","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/GC1_2023-03-23_11-29-08_c9a9c.png"},{"post_url":"https:\/\/psxon.com\/gold-prices-turn-to-us-initial-jobless-claims-to-gauge-svb-economic-shock\/","description":"Gold, XAU\/USD, Federal Reserve, Jobless Claims \u2013 Briefing: Gold prices gained on the Fed as USD and Treasury yields fell","date":"March 23, 2023","views":0,"post_id":211,"content":"\nGold, XAU\/USD, Federal Reserve, Jobless Claims \u2013 Briefing:\n\nGold prices gained on the Fed as USD and Treasury yields fell\nAll now focus on US initial jobless claims to gauge SVB impact\nXAU\/USD turned back towards key resistance, where to next?\n\n\n\n\nRecommended by                    Daniel Dubrovsky\n\n\nHow to Trade Gold\n\n\n\nGold prices gained about 1.6% on Wednesday in the aftermath of the Federal Reserve rate decision and Chair Jerome Powell\u2019s press conference. The takeaway from the Fed was that Mr Powell stressed that at this time, policymakers did not see the case for rate cuts this year. The latter is something that markets have been aggressively pricing in since SVB\u2019s collapse.\nStill, markets focused on the less hawkish shift in the Fed policy statement. Policymakers downgraded the messaging about rate hikes being as \u201congoing increases\u201d to \u201canticipating\u201d some extra firming as appropriate. The 2-year Treasury yield and US Dollar turned lower on the Fed. Gold typically functions as the anti-fiat instrument. As such, XAU\/USD welcomed the decline in the greenback and bond yields.\nUnderstand that markets remain firmly on the anticipated rate cut path for this year while Fed projections do not. If the latter ends up being the story, gold would be at risk of giving up its progress since earlier this month. With that in mind, what is gold facing over the remaining 24 hours?\nAll eyes turn to US initial jobless claims due at 12:30 GMT. Economists anticipate unemployment filings to clock in at +197k last week compared to +192k prior. Jobless claims are one of the few timely pieces of data we have on the labor market. It will offer a slight glimpse into how the economy is faring in the first full week after Silicon Valley Bank collapsed. An unexpectedly strong surge could confirm market expectations of rate cuts. That may benefit gold.\nXAU\/USD Daily Chart\nOn the daily chart, gold can be seen turning back higher to the critical 1998 \u2013 2009 resistance zone. This is undermining the emergence of a bearish Evening Star candlestick pattern. A confirmatory close above this resistance range would open the door to an increasingly bullish outlook. Otherwise, extending lower places the focus on the 23.6% Fibonacci retracement level at 1916.\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\n\nChart Created Using TradingView\n\u2014 Written by Daniel Dubrovsky, Senior Strategist for DailyFX.com\nTo contact Daniel, follow him on Twitter:@ddubrovskyFX\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Gold Prices Turn to US Initial Jobless Claims to Gauge SVB Economic Shock","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1679549943_image1.png"},{"post_url":"https:\/\/psxon.com\/gold-price-technical-setup-seems-bearish-before-jerome-powells-anticipated-hike\/","description":"Gold, XAU\/USD, Federal Reserve, Jerome Powell \u2013 Briefing: Gold prices declined almost % as Treasury yields fell on Tuesday Markets","date":"March 22, 2023","views":2,"post_id":208,"content":"\nGold, XAU\/USD, Federal Reserve, Jerome Powell \u2013 Briefing:\n\nGold prices declined almost 2% as Treasury yields fell on Tuesday\nMarkets have been pricing in swift Fed cuts since SVB\u2019s collapse\nAll eyes now turn to Jerome Powell, will the central bank capitulate?\nXAU\/USD technical setup before the Fed is looking increasingly bearish\n\n\n\n\nRecommended by                    Daniel Dubrovsky\n\n\nHow to Trade Gold\n\n\n\nGold prices sank almost 2% on Tuesday, marking the worst single-day performance since February 3rd. The anti-fiat yellow metal struggled amidst a 4.7% increase in the 2-year Treasury yield as the S&P 500 pushed higher. The US benchmark stock index is up about 2.3% this week so far. If equities hold onto their gains, we could be looking at the best week since the end of January.\nCalm is appearing to reinforce itself in financial markets after actions were taken to alleviate concerns in the financial sector since Silicon Valley Bank collapsed. The VIX market \u2018fear gauge\u2019 is down 16.1% this week so far in the largest decline in about a year. With that in mind, what are the remaining 24 hours looking like for gold?\nAll eyes are turning to the Federal Reserve rate decision at 18:00 GMT. A 25-basis point rate hike to 5% from 4.75% is priced in. Chair Jerome Powell\u2019s press conference then starts at 18:30 GMT. Since SVB\u2019s collapse, markets have priced in over 100 basis points in cuts towards the end of this year after tomorrow\u2019s delivery. That has benefited the yellow metal.\nThe Fed faces a tough choice given a lack of timely economic data after SVB\u2019s collapse. This is especially considering that prior to it, inflation expectations were heating up again after solid economic data, especially from the labor market. A pause in the tightening cycle could bode well for gold. But, efforts to continue fighting inflation would likely hurt XAU\/USD. As such, volatility risk is elevated.\nXAU\/USD Daily Chart\nFrom a technical standpoint, things are shaping up to be quite wobbly for gold. That is because a bearish Evening Star candlestick pattern formed. Further downside confirmation would open the door to extending lower, placing the focus on the 100-day Simple Moving Average (SMA). The latter could hold as support pivoting prices higher. Key resistance is the 1978 \u2013 1998 zone from April 2022.\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\n\nChart Created Using TradingView\n\u2014 Written by Daniel Dubrovsky, Senior Strategist for DailyFX.com\nTo contact Daniel, follow him on Twitter:@ddubrovskyFX\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Gold Price Technical Setup Seems Bearish Before Jerome Powell\u2019s Anticipated Hike","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1679462010_image1.png"},{"post_url":"https:\/\/psxon.com\/gold-price-gallops-north-on-weaker-us-dollar-ahead-of-fed-where-to-for-xau-usd\/","description":"Gold, XAU\/USD, US Dollar, Credit Suisse, UBS, AT, Fed, VIX, GVZ \u2013 Talking Points The gold price is making new","date":"March 21, 2023","views":1,"post_id":205,"content":"\n\nGold, XAU\/USD, US Dollar, Credit Suisse, UBS, AT1, Fed, VIX, GVZ \u2013 Talking Points\n\nThe gold price is making new highs while banking instability lingers\nMarkets could be pivoting toward better quality assets among the turbulence\nIf the Fed backs away from its hawkishness, will XAU\/USD be boosted?\n\n\n\n\nRecommended by                    Daniel McCarthy\n\n\nHow to Trade Gold\n\n\n\nGold made a one-year high just shy of US$ 2,010 an ounce overnight as markets continue to digest the impacts of the Credit Suisse \u2013 UBS deal and broader concerns for banks with weak balance sheets.\nThe Wall Street cash session saw large-cap banks make notable gains while First Republic Bank collapsed again. The price action could be suggestive of the market seeking quality assets amid the uncertainty of potential contagion.\nCredit Suisse\u2019s AT1 bond is trading near zero and other European bank AT1 bonds have also been hit hard, despite the terms of those notes being significantly different to the Credit Suisse bonds.\nAT1 (alternative tier 1) bonds do not have a maturity date (perpetual) and are subordinate to all other debt instruments but rank above equity.\nWith all this mayhem, the perceived haven status of the precious metal appears to have added to its lustre.\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\nThe US Dollar also collapsed to a four-week low yesterday further lifting XAU\/USD. Treasury yields have steadied after the rout last week and real yields have recovered some lost ground ahead of the Federal Open Market Committee (FOMC) meeting on Wednesday.\nFutures and swaps markets are leaning toward a 25 basis point lift but it is not fully priced in. The quandary for the Fed is the unknown number of other banks and corporates that could be vulnerable to the tightening monetary conditions that they have created in order to rein in sky-high inflation.\nSince the collapse of SVB Financial, gold has moved higher, while the US Dollar and real yields have slipped lower. The unpredictability of the current circumstances has also seen volatility tick higher in equities and gold as represented by the VIX and GVX indices.\nIf these conditions continue to prevail, they might be supportive of the yellow metal and the all-time high of US$ 2,075 an ounce may come into view.\nGOLD AGAINST US DOLLAR (DXY), US 10-YEAR REAL YIELDS AND VOLATILITY (GVZ)\n\nChart created in TradingView\n\u2014 Written by Daniel McCarthy, Strategist for DailyFX.com\nPlease contact Daniel via @DanMcCathyFX on Twitter\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Gold Price Gallops North on Weaker US Dollar Ahead of Fed. Where to for XAU\/USD?","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1679373848_image1.png"},{"post_url":"https:\/\/psxon.com\/dow-jones-nasdaq-100-gold-us-dollar-crude-oil-fed-powell\/","description":"Recommended by Daniel Dubrovsky Get Your Free Equities Forecast Global market volatility was on edge this past week as financial-related","date":"March 20, 2023","views":0,"post_id":202,"content":"\n\n\n\nRecommended by                    Daniel Dubrovsky\n\n\nGet Your Free Equities Forecast\n\n\n\nGlobal market volatility was on edge this past week as financial-related stocks disproportionately suffered. On Wall Street, the Dow Jones fell -0.15%, but the tech-heavy Nasdaq soared 4.41%. Across the Atlantic, the DAX 40 and FTSE 100 sank -4.28% and -5.33%, respectively. This is as Japan\u2019s Nikkei 225 fell -2.88% while Hong Kong\u2019s Hang Seng Index rose 1%.\nRegional banks were feeling the pinch of Silicon Valley Bank\u2019s collapse earlier this month. Despite receiving a financial lifeline from larger banks, Frist Republic Bank shares collapsed over 70% over the past 5 trading sessions. Troubles at Credit Suisse further compounded bank sector woes as a few major banks were reported curbing trading with the lender or are considering it.\nAs a result, traders were quick and aggressive at the pricing in rate cuts from the Federal Reserve. Compared to March 10th, markets priced in a full 100 basis points in cuts looking 6 months out. That would leave the Federal Funds Rate around 4.25% after anticipating hikes to 5.25% beforehand. The 2-year Treasury yield tumbled.\nIn response, the US Dollar turned lower as markets focused on a dovish Fed. Anti-fiat gold soared and is up about 8.9% this month. We have not seen this kind of performance since July 2020 during the Covid pandemic as central banks rushed to cut rates around the world. Meanwhile, the price of WTI crude oil collapsed 13.55% last week, the most since February 2020.\nAhead, all eyes will be planted on the Federal Reserve on Wednesday. All bets of a 50-basis point hike have vanished, with there being rising expectations of an end to the tightening cycle. But, slightly over 50% of expectations favor a 25bps increase. Either way, this is opening the door to a surprise either way if the odds get closer to 50-50. The Bank of England will also be setting rates. What else is in store for markets in the week ahead?\n\n\n\nRecommended by                    Daniel Dubrovsky\n\n\nGet Your Free USD Forecast\n\n\n\nHow Markets Performed \u2013 Week of 3\/13\n\nFundamental Forecasts:\nEuro (EUR) Weekly Forecast: Hawkish ECB Hikes Rates, Bank Stocks Highlight Risk\nThe ECB hiked interest rates by 50bps on Thursday, and said they will do more to fight inflation. The Euro grabbed a small bid but Euro Area bank stocks fell further.\nGBP Forecast: UK CPI and BoE Rate Decision Complicated by Banking Rout\nBoE officials have the unenviable task of hiking into the current banking sector turmoil. UK Inflation data on Wednesday alongside the FOMC meeting and projections.\nUS Dollar Outlook Hinges on Fed\u2019s Next Steps. Will the FOMC Hike or Pause?\nThe US dollar\u2019s trading bias will be defined by the Fed\u2019s policy outlook next week. Traders should prepare for the possibility of a dovish guidance due to rising financial instability risks.\nTechnical Forecasts:\nNasdaq 100, Dow Jones, S&P 500 Technical Forecast: Mixed Week Offers Neutral View\nThere was a disproportionate rise in tech stocks last week as the Nasdaq 100 roared higher but the Dow Jones was left behind. Broadly speaking, the US equities technical outlook is neutral.\n\u2014 Article Body Written by Daniel Dubrovsky, Senior Strategist for DailyFX.com\n\u2014 Individual Articles Composed by DailyFX Team Members\nTo contact Daniel, follow him on Twitter:@ddubrovskyFX\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Dow Jones, Nasdaq 100, Gold, US Dollar, Crude Oil, Fed, Powell","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1679288963_image1.png"},{"post_url":"https:\/\/psxon.com\/us-dollar-outlook-hinges-on-feds-next-steps-will-the-fomc-hike-or-pause\/","description":"US DOLLAR FORECAST: U.S. dollar retreats on the week as Treasury yields plunge on banking sector turmoil The FOMC\u2019s monetary","date":"March 19, 2023","views":0,"post_id":199,"content":"\nUS DOLLAR FORECAST:\n\nU.S. dollar retreats on the week as Treasury yields plunge on banking sector turmoil\nThe FOMC\u2019s monetary policy meeting will steal the limelight next week\nThe Fed is expected to raise rates by 25 basis points, but a pause should not be entirely ruled out in case of further stress in financial markets in the coming days\n\n\n\n\nRecommended by                    Diego Colman\n\n\nGet Your Free USD Forecast\n\n\n\nMost Read: Gold Prices Jump as Yields Slump, Sentiment Dismal as Bank Angst Lingers\nThe U.S. dollar, as measured by the DXY index, came under pressure this week, sliding about 0.8% to settle slightly below the 104.00 level, undermined by the steep drop in U.S. bond yields, as traders repriced lower the Federal Reserve\u2019s tightening path in the face of tremendous banking sector turmoil.\nBets about the outlook for monetary policy shifted in a dovish direction after the collapse of two mid-size U.S. regional banks fanned fears of a financial Armageddon, prompting the Fed to launch emergency measures to shore up depository institutions facing liquidity constraints.\nThe chart below displays how much Treasury yields and Fed terminal rate expectations have fallen since the middle of last week despite Jerome Powell\u2019s hawkish message to Congress. It also shows how the dollar has retreated in parallel with those assets.\n2023 FED FUNDS FUTURES IMPLIED YIELD\n\nSource: TradingView\n\n\n\nRecommended by                    Diego Colman\n\n\nIntroduction to Forex News Trading\n\n\n\nTaking into account recent developments, the path of least resistance is likely to be lower for the U.S. dollar, provided the current situation doesn\u2019t spiral out of control and leads to a large financial crisis, as that would stand to benefit defensive currencies.\nTraders will be equipped with more information to better assess the greenback\u2019s prospects after the Fed announces its March policy decision this coming Wednesday. While expectations have been in flux, market pricing now leans toward a quarter-point interest rate hike \u2013 a move that would take borrowing costs to 4.75%-5.00%, the highest level since 2007.\nAnyway, a \u201cpause\u201d is still in play and should not be completely ruled out, as a lot could happen between now and Wednesday. Events in the last few days have shown that bad news comes unannounced and out of nowhere. That said, any renewed financial stress could nudge policymakers to err on the side of caution and adopt a \u201cwait and see\u201d approach.\nWhatever the Fed decides next week, the stars have aligned for guidance to be dovish. The FOMC is likely to emphasize the importance of preserving financial stability and its readiness to act to prevent systemic risks from materializing. The implications of this message could lead to further U.S. dollar weakness.\nWritten by Diego Colman, Contributing Strategist\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"US Dollar Outlook Hinges on Fed\u2019s Next Steps. Will the FOMC Hike or Pause?","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1679204274_image1.png"},{"post_url":"https:\/\/psxon.com\/gold-prices-jump-as-yields-slump-sentiment-dismal-as-bank-angst-lingers\/","description":"GOLD PRICE OUTLOOK: Gold prices rally as bond yields take a turn to the downside U.S. banking sector turmoil weighs","date":"March 18, 2023","views":0,"post_id":196,"content":"\nGOLD PRICE OUTLOOK:\n\nGold prices rally as bond yields take a turn to the downside\nU.S. banking sector turmoil weighs on sentiment, boosting appetite for defensive assets\nThis article looks at key XAU\/USD technical levels to watch in the coming days\n\n\n\n\nRecommended by                    Diego Colman\n\n\nGet Your Free Gold Forecast\n\n\n\nMost Read: Gold Price Holds the High Ground Amid Banking Turmoil. Where to for XAU\/USD?\nAfter a modest pullback on Thursday, gold prices (XAUUSD) resumed their advance on Friday, rallying more than 2% to ~$1,965 and heading for their best week since November of last year, boosted by falling U.S. Treasury yields and stronger safe-haven demand.\nWhile sentiment seemed to be on the mend following news that 11 large U.S. financial institutions have banded together to rescue First Republic Bank, the cheerful mood was short-lived on Wall Street, with traders acknowledging that the banking sector turmoil is still unresolved. This is benefiting defensive assets.\nThe market narrative is in a flux, but the fear now is that collective aid by top banks to prop up their beleaguered peer may spread the crisis rather than contain it. Why, because if the smaller regional lender were to fail, the aiding institutions would be exposed to large losses, increasing the risks of contagion.\nIn this environment, gold is likely to retain a bullish bias. In fact, gains could be meaningful if threats of financial instability lead the Fed to pause its tightening cycle at its March gathering. Although investors are expecting a 25 bp hike at this meeting, a pause should not be entirely ruled out if market conditions worsen in the coming days.\nIn terms of technical analysis, XAU\/USD is now challenging trendline resistance in the $1,960\/$1,965 area following the recent rally. If prices break above this barrier, bulls could launch an attack on February\u2019s high near $1,975. On further strength, the focus shifts to the April 2022 high just a touch above the psychological $2,000 level.\nOn the flip side, if sellers regain control of the market and spark a pullback, initial support rests around the $1,900 region. Below that, we have the 50-day simple moving average near $1,875 and $1,860 thereafter.\n\n\n\nof clients are net long.    of clients are net short.    \n\n\n\n\n\n\n\n\nChange in        \n\nLongs        \n\nShorts        \n\nOI        \n\n\n\n\nDaily\n-17%\n18%\n-3%\n\n\nWeekly\n-24%\n58%\n1%\n\n\n\n\nGOLD PRICES TECHNICAL CHART\n\nGold Futures Prices Prepared Using TradingView\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Gold Prices Jump as Yields Slump, Sentiment Dismal as Bank Angst Lingers","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1679116200_image1.png"},{"post_url":"https:\/\/psxon.com\/cooling-bank-volatility-fed-policy-bets\/","description":"Crude Oil, WTI, Frist Republic Bank, Fed Policy Outlook \u2013 Talking Points: Crude oil prices traded flat amid competing fundamental","date":"March 17, 2023","views":0,"post_id":193,"content":"\nCrude Oil, WTI, Frist Republic Bank, Fed Policy Outlook \u2013 Talking Points:\n\nCrude oil prices traded flat amid competing fundamental themes\nFirst Republic Bank poised to receive rescue aid cooled volatility\nBut, markets also priced out some Fed rate cut expectations ahead\n\n\n\n\nRecommended by                    Daniel Dubrovsky\n\n\nHow to Trade Oil\n\n\n\nWTI crude oil prices traded relatively flat over the past 24 hours in an overall volatile trading session. On the one hand, reports crossed the wires that First Republic Bank was poised to receive emergency aid to the tune of 30 billion from major lenders. But, because of cooling woes in the financial sector, Treasury yields were pushed higher.\nThe latter speaks to traders pricing out anticipated rate cuts from the Federal Reserve later this year because of last week\u2019s Silicon Valley Bank collapse. Market-implied policy rates have added back about 50 basis points in tightening for the 3-month horizon. That would leave rates around 5% instead of the 4.5% seen earlier in the week.\nAs such, sentiment-linked crude oil faced opposing fundamental forces. On the one hand, risk appetite improved. On the other hand, a Fed that can continue tightening could bode ill for future oil demand. Looking at the remaining 24 hours, eyes turn to the University of Michigan Sentiment data at 14:00 GMT. A softer outcome speaking to worried consumers may renew selling pressure for WTI.\nCrude Oil Technical Analysis \u2013 Daily Chart\nOn the daily chart, crude oil confirmed a breakout under a Bearish Rectangle chart formation. That may open the door to downtrend resumption. Key support seems to be a wide range between 61.69 and 65.60. The latter was established in May 2021. On the other hand, turning higher would place the focus on the December low at 70.10, which may hold as resistance.\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\n\nChart Created Using TradingView\nCrude Oil Sentiment Analysis \u2013 Bearish\nLooking at IG Client Sentiment (IGCS), which tends to function as a contrarian indicator, about 90% of retail traders are net-long crude oil. Since most of them are long, this hints prices may fall. Upside exposure fell by 2.86% compared to yesterday. But, compared to last week, net-long bets soared almost 50%. With that in mind, the combination of overall positioning and recent changes in exposure is offering a bearish contrarian trading bias.\n\n\u2014 Written by Daniel Dubrovsky, Senior Strategist for DailyFX.com\nTo contact Daniel, follow him on Twitter:@ddubrovskyFX\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Cooling Bank Volatility & Fed Policy Bets","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1679028204_image1.png"},{"post_url":"https:\/\/psxon.com\/australian-dollar-edges-north-after-solid-jobs-data-where-to-for-aud-usd\/","description":"Australian Dollar, AUD\/USD, US Dollar, Unemployment, NZD\/USD \u2013 Talking Points The Australian Dollar skipped a beat on robust jobs figures","date":"March 16, 2023","views":0,"post_id":190,"content":"\n\nAustralian Dollar, AUD\/USD, US Dollar, Unemployment, NZD\/USD \u2013 Talking Points\n\nThe Australian Dollar skipped a beat on robust jobs figures\nThe US Dollar still dominates AUD\/USD proceedings for now\nThe RBA\u2019s dovish tilt might be warranted by external factors\n\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\nThe Australian Dollar nudged higher after jobs data came in above forecasts to match the lowest unemployment rate since the 1970s.\nThe unemployment rate dipped to 3.5% in February against the 3.6% anticipated and 3.7% prior. 64.6k Australian jobs were added in the month, which was above the 50k anticipated and -10.9k previously.\nThe tick-up in AUD\/USD comes after a whippy week in the face of evolving turmoil across global markets. The price action has reflected the gyrations seen in the US Dollar after the collapse of three US regional banks and now the pressure emerging on Republic Bank and Credit Suisse.\nThe renewed tightness in the labour market comes after the RBA took their foot off the pedal in their inflation fight by taking a dovish tilt earlier this month.\nThe interest rate market is leaning toward no change in the official cash rate next month. If that occurs, it will be the first time since April last year that the bank has not hiked rates at its monthly monetary policy meeting.\n\n\n\nRecommended by                    Daniel McCarthy\n\n\nHow to Trade AUD\/USD\n\n\n\nGiven the current situation in global markets, it appears as though there will a lot of water passing under the bridge before the next meeting. There remains a significant degree of uncertainty surrounding the ramifications of the failure of the US banks\nAlthough the Australian economy is running hot, the broader implications of tightening global financial conditions for risk assets would seem likely to impact the Aussie at some stage.\nAcross the Tasman Sea earlier today, New Zealand GDP came in lower than anticipated and opens the probability of the island nation going into recession. Fourth quarter GDP was -0.6% quarter-on-quarter rather than -0.2% forecast and 2% prior. The year-on-year read was 2.2%, well below the 3.3% anticipated and 6.4% previously. This saw NZD\/USD drop half a cent, but it recovered much of this in the aftermath. The Kiwi may have been aided by Fonterra, New Zealand\u2019s largest company, announcing a 50% lift in profits from this time last year.\nAUD\/USD TECHNICAL ANALYSIS\nAUD\/USD closed outside the lower band of the 21-day Simple Moving Average (SMA) based Bollinger Band last week before closing back inside it to set up a rally toward this week\u2019s peak of 0.6717.\nThat high might provide resistance ahead of the previous peaks and breakpoints of 0.6784, 0.6856 and 0.6916.\nThe price is currently below all period SMAs and this may suggest that bearish momentum might unfold. With the exception of the 100-day SMA, all SMAs have a negative gradient. Should the slope 100-day SMA turn negative, it could confirm emerging bearishness.\nSupprt on the downside could be at the prior lows and breakpoints of 0.6565, 0.6548, 0.6387, 0.6272 and 0.6170.\n\n\u2014 Written by Daniel McCarthy, Strategist for DailyFX.com\nPlease contact Daniel via @DanMcCathyFX on Twitter\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Australian Dollar Edges North after Solid Jobs Data. Where to for AUD\/USD?","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1678943912_image1.png"},{"post_url":"https:\/\/psxon.com\/crude-oil-price-slumps-post-cpi-as-volatility-lifts-ahead-of-the-fed-lower-wti\/","description":"Crude Oil, US Dollar, WTI, FOMC, Fed, API, Crack Spread, Volatility \u2013 Talking Points Crude oil has had a tumultuous","date":"March 15, 2023","views":0,"post_id":187,"content":"\n\nCrude Oil, US Dollar, WTI, FOMC, Fed, API, Crack Spread, Volatility \u2013 Talking Points\n\nCrude oil has had a tumultuous week so far and volatility may continue\nThe Fed still has its work cut out and further tightening might be on the cards\nInflation and inventory data probably haven\u2019t helped crude. Where to for WTI?\n\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\nCrude oil sunk to a 3-month low overnight after headline US inflation hit forecasts, coming in at 6.0% year-on-year and 0.4% month-on-month. Monthly core CPI was a slight beat at 0.5% instead of the 0.4% anticipated but the annual number was in line at 5.5%.\nThe market appears to have backtracked toward a 25 basis point (bp) hike from the Federal Reserve next week after pondering a pause in the aftermath of the failure of Silvergate Corp., SVB Financial and Signature Bank over the last few days.\nWith the Fed now viewed as hawkish again, recession fears seem to be lingering with the tightening cycle yet to play out.\nHaving said that, the terminal rate is now being priced by interest rate markets almost 100 bp lower than where it was at this time last week. Next week\u2019s Federal Open Market Committee (FOMC) meeting might provide more guidance on the veracity of the market outlook for the Fed\u2019s rate path.\n\n\n\nRecommended by                    Daniel McCarthy\n\n\nHow to Trade Oil\n\n\n\nAdding to bearish sentiment, crude oil inventories rose 1.155 million barrels to the end of last week in the US according to reports from the American Petroleum Institute (API). At the same time, gasoline inventories fell by 4.6 million barrels\nThat data may support the current level of the crack spread between the WTI crude and RBOB gasoline futures contracts. The crack spread bifurcates the difference in price between WTI crude oil and refined RBOB gasoline.\nIt shows the refined product remaining elevated relative to the crude product. This might eventually be supportive of WTI.\nConversely, the move down has seen overall volatility tick higher and may suggest the oil market is looking to cover exposure in the move. The OVX index measures the volatility of oil in a similar way that the VIX index measures the implied volatility on the S&P 500.\nSeparately, the May 2023 25-delta risk-reversal moved further in favour of puts overnight as it moved toward -6.7 from around -3.0 where it had been trading for the last few weeks.\nThe risk reversal is the price of a call option in volatility terms less the price of a put option in volatility terms for the same date and delta. This could suggest that more \u2018insurance\u2019 is being taken out for downside protection rather than on the upside.\nThe front two WTI futures contracts reveal a slight bias toward contango, which at the margin might allow for some softening in price.\nWhile the macro environment might be stabilising after the shock collapse of the three banks, the oil market will be watching the official US Energy Information Agency (EIA) inventory data that is due later today.\nWTI CRUDE OIL, CRACK SPREAD, BACKWARDATION\/CONTANGO, VOLATILITY (OVX)\n\nChart created in TradingView\n\u2014 Written by Daniel McCarthy, Strategist for DailyFX.com\nTo contact Daniel, use the comments section below or @DanMcCathyFX on Twitter\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Crude Oil Price Slumps Post CPI As Volatility Lifts Ahead of the Fed. Lower WTI?","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1678855502_image1.png"},{"post_url":"https:\/\/psxon.com\/crude-oil-faces-perfect-storm-if-us-inflation-pours-gasoline-on-uncertainty-flame\/","description":"Crude Oil, WTI, Fed Pivot Bets, CPI Report \u2013 Talking Points: Crude oil extends losses during Tuesday Asia-Pacific trading session","date":"March 14, 2023","views":0,"post_id":184,"content":"\nCrude Oil, WTI, Fed Pivot Bets, CPI Report \u2013 Talking Points:\n\nCrude oil extends losses during Tuesday Asia-Pacific trading session\nMarket uncertainty may be pushed further with traders eyeing US CPI\nAnother sticker print could reinvigorate hawkish Fed policy estimates\n\n\n\n\nRecommended by                    Daniel Dubrovsky\n\n\nHow to Trade Oil\n\n\n\nWTI crude oil prices fell 2.55% on Monday as market volatility remained elevated in the fallout of last week\u2019s collapse of Silicon Valley Bank. Since last Wednesday, the commodity is down about 3.3%.\nSentiment-linked crude oil was and may continue to remain vulnerable in the coming days\/weeks\/months as traders assess the likelihood of the United States economy entering a recession. Despite steps taken by the government to shore up confidence in the banking system, investors punished regional bank stocks on Monday.\nHowever, a closer glance reveals that the market reaction on Monday seems to place much more emphasis on expectations of a Federal Reserve pivot than worries about a recession (for now). In fact, traders have priced in about 150 basis points in rate cuts by the Fall of this year. In response, the haven-linked US Dollar sank, and traders piled into tech stocks. The Nasdaq 100 outperformed the Dow Jones.\nDuring Tuesday\u2019s Asia-Pacific trading session, sentiment woes continued deteriorating crude oil prices, with WTI falling almost 1.25% by 3 GMT.\nOver the remaining 24 hours, market uncertainty could be pushed further. All eyes are on the 12:30 GMT US CPI report. In February, inflation is seen slowing further to 6.0% y\/y from 6.4%. As a reminder, January\u2019s print was stickier than anticipated. Another surprisingly strong print could bring back Fed rate hike expectations, placing crude oil at risk.\nCrude Oil Technical Analysis \u2013 Daily Chart\nOn the daily chart, crude oil is fast approaching the floor of a Bearish Rectangle chart formation. The price seems to be around 72.27. However, immediately below is the December low at 70.10 \u2013 71.13. Confirming a breakout under the latter exposes lows from May 2021.\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\n\nChart Created Using TradingView\nCrude Oil Sentiment Analysis \u2013 Bearish\nLooking at IG Client Sentiment (IGCS), which tends to be a contrarian indicator, about 82.78% of retail traders are net-long crude oil. Since most of them are biased to the upside, this hints that prices may continue falling. Meanwhile, upside exposure increased by 9.56% and 30.63%, respectively. With that in mind, the combination of overall positioning and recent changes in exposure offers a stronger bearish bias.\n\n\u2014 Written by Daniel Dubrovsky, Senior Strategist for DailyFX.com\nTo contact Daniel, follow him on Twitter:@ddubrovskyFX\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Crude Oil Faces Perfect Storm if US Inflation Pours Gasoline on Uncertainty Flame","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1678771125_image1.png"},{"post_url":"https:\/\/psxon.com\/us-dollar-slides-as-svb-repercussions-stalled-by-the-fed-and-the-treasury-department\/","description":"US Dollar, DXY Index, Fed, ECB, Euro, EUR\/USD \u2013 Talking points The US Dollar ran lower at the open today","date":"March 13, 2023","views":0,"post_id":181,"content":"\n\n\nUS Dollar, DXY Index, Fed, ECB, Euro, EUR\/USD \u2013 Talking points\n\nThe US Dollar ran lower at the open today as risks swirl\nTreasury yields dipped as government paper became attractive\nIf the Fed and Treasury Department are successful, will USD recover?\n\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\nThe US Dollar is under the pump to start the week as uncertainty from the fallout of the collapse of Silicon Valley Bank (SVB) permeates markets.\nSignature Bank also fell into receivership over the weekend, but the Federal Reserve and the US Treasury Department have moved swiftly to provide a backstop to minimise contagion.\nNonetheless, everything from credit default swaps to Asian tech companies to Argentinian bonds is facing scrutiny today.\nWhile the greenback is under pressure, Wall Street futures are notching up gains as the market appears to be comfortable at this stage with the steps that authorities have taken so far.\nMost notably, authorities have reassured depositors at these banks that they will be able to withdraw their money and that the Federal Reserve will provide liquidity for eligible financial firms.\nThe Federal Reserve announced that \u201cit will make available additional funding to eligible depository institutions to help assure banks can meet the needs of all their depositors.\u201d\nFurthermore, they said, \u201cadditional funding will be made available through the creation of a new Bank Term Funding Program (BTFP), offering loans of up to one year in length to banks, savings associations, credit unions, and other eligible depository institutions pledging U.S. Treasuries, agency debt and mortgage-backed securities, and other qualifying assets as collateral.\u201d\nAuthorities have made it clear that any government assistance will be going to depositors and will not be used to bail out bond or equity investors.\nThe Treasury Department has recognised that other banks are in a similar position as SVB and Signature Bank, but they have said that it is a very different situation to 2008.\nUS President Joe Biden will be speaking on Monday morning US time on the SVB situation, and his administration will be briefing Congress.\n\n\n\nRecommended by                    Daniel McCarthy\n\n\nHow to Trade EUR\/USD\n\n\n\nThis episode has disrupted the outlook for rates going forward ahead of next week\u2019s Federal Open Market Committee (FOMC) meeting on the 22nd of March. The market had previously been leaning toward a 50 basis point hike but now sees 25 bp as more likely.\nTo complicate matters, the Fed has gone into a blackout period, meaning that board members will not be making any public comments until after the meeting.\nExpectations of the terminal rate of the Fed funds target rate have been lowered from near 5.70% last week to around 5.13% today. The 2s 10s yield curve is inverted by only -75 bp, more than 30 bp tighter than last Wednesday.\nThe strong US jobs numbers on Friday paled against the small banking crisis and US CPI on Tuesday may not have the impact on the FOMC meeting that it previously would have.\nTreasury yields have collapsed and if they continue to trade lower, The US Dollar might be further undermined. The 2-year note is now around 70 bp lower than the peak of 5.08% last week, which was the highest yield since July 2007.\nConversely, if the authorities are successful in corralling contagion risks, Treasury yields might find support.\nDXY (USD) INDEX AGAINST TREASURY 2- AND 10-YEAR YIELDS\n\nChart Created in TradingView\n\u2014 Written by Daniel McCarthy, Strategist for DailyFX.com\nTo contact Daniel, use the comments section below or @DanMcCathyFX on Twitter\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"US Dollar Slides as SVB Repercussions Stalled by the Fed and the Treasury Department","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1678682656_image1.png"},{"post_url":"https:\/\/psxon.com\/inflation-data-may-revive-rally-but-svb-meltdown-poses-risks\/","description":"US DOLLAR OUTLOOK: The U.S. dollar, as measured by the DXY index, finish the week lower as U.S. Treasury rates","date":"March 12, 2023","views":0,"post_id":178,"content":"\nUS DOLLAR OUTLOOK:\n\nThe U.S. dollar, as measured by the DXY index, finish the week lower as U.S. Treasury rates take a turn to the downside\nBond yields plunge despite solid U.S. labor market data, with the move likely tied to concerns emanating from the financial sector following the collapse of SVB\nAll eyes on the U.S. inflation report next week. Bias is for an upside surprise\n\n\n\n\nRecommended by                    Diego Colman\n\n\nGet Your Free USD Forecast\n\n\n\nMost Read: Euro Week Ahead Forecast \u2013 Will ECB Hawks Gain the Upper Hand on Rate Hikes?\nThe U.S. dollar, as measured by the DXY index was on track for a positive week following Powell\u2019s hawkish comments on Tuesday and Wednesday, but a steep decline in Treasury rates on Thursday and Friday turned the tables, leading the currency benchmark to give up gains and end about flat in the five-session span.\nHeading into the weekend, government bond yields dropped like a rock, plunging the most since 2008, as traders repriced lower the Fed\u2019s hiking path despite the solid February U.S. employment results. For context, the U.S. economy added 311,000 jobs in February, well above consensus estimates, but average hourly earnings were slightly weaker than anticipated, clocking in at 0.2% m-o-m and 4.6% y-o-y, a tenth of a percent below Wall Street forecasts.\nSoftening wage growth is encouraging, but this metric has been very volatile and subject the frequent revisions in recent months, signaling that it may not be reliable as a turnaround signal or as an indicator of less tightness in the labor market. So why have expectations about the monetary policy outlook shifted in a more dovish direction over the past 48 hours, as shown in the chart below, which points to an FOMC terminal rate of 5.28 % versus 5.70% on Wednesday?\n2023 FED FUNDS FUTURES IMPLIED YIELD\n\nSource: TradingView\n\n\n\nRecommended by                    Diego Colman\n\n\nForex for Beginners\n\n\n\nRecent bond market dynamics may be related to banking sector stress sparked by the Silicon Valley Bank (SVB) meltdown. The collapse of this institution, which was shut down on Friday by regulators to protect depositors, has increased fears of broad financial contagion, bringing to the surface hidden risks in the industry and its vulnerability to the current environment of rapidly rising borrowing costs.\nAlthough liquidity concerns have been rising in the wake of the FOMC\u2019s forceful tightening campaign, most large banks remain well capitalized despite losses in their long-term investment portfolios, suggesting that the SVB\u2019s troubles have not yet reached a systemic level. This means that the downward correction in yields may be exaggerated and therefore transitory.\nFocusing on next week\u2019s CPI report, the annual headline index is seen downshifting to 6.0% from 6.4%, while the core gauge is forecast to ease to 5.5% from 5.6%. In terms of possible scenarios, softer-than-anticipated data could ease wagers on a half-point FOMC rate rise in March, tilting expectations more firmly in favor of a quarter-point hike. On the flip side, hotter-than-forecast results could set the stage for faster monetary tightening, leading to a higher terminal rate. The latter case appears more plausible at this time.\nAs for the US dollar, its recent decline may be short-lived. If rates reprice higher again on the back of hot data, the greenback is likely to resume its recovery in short order. If turbulence intensifies, risk aversion and the flight to safety may be a source of support. Only if the Fed blinks will the U.S. dollar weaken on a sustained basis, but recent comments from Chairman Powell suggest that policymakers have no intention of letting up just yet.\nWritten by Diego Colman, Contributing Strategist\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Inflation Data May Revive Rally but SVB Meltdown Poses Risks","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1678598262_image1.png"},{"post_url":"https:\/\/psxon.com\/us-economy-adds-strong-311000-jobs-wages-grow-less-than-expected\/","description":"US JOB REPORT KEY POINTS: U.S. employers add , jobs in February, topping estimates calling for a gain of ,","date":"March 11, 2023","views":311000205000,"post_id":175,"content":"\nUS JOB REPORT KEY POINTS:\n\nU.S. employers add 311,000 jobs in February, topping estimates calling for a gain of 205,000 payrolls. Meanwhile, the unemployment rate rises to 3.6%, two-tenths of a percent above forecasts\nAverage hourly earnings clock in at 0.2% month-over-month and 4.6% year-over-year, slightly below expectations\nWith the NFP data in the rearview mirror, attention will now turn to the U.S. February inflation report due for release next week\n\n\n\n\nRecommended by                    Diego Colman\n\n\nGet Your Free USD Forecast\n\n\n\nMost Read: Gold Prices Soar as US Bank Sector Woes Sink Bond Yields\nUpdated at 9:15 am ET\nMARKET REACTION\nImmediately after the NFP report crossed the wires, the U.S. dollar, as measured by the DXY index, extended its decline, as Treasury yields deepened their session slump and expectations for the Fed\u2019s terminal rate drifted lower. The reaction is a bit counterintuitive as employment growth remained extremely strong last month, but it is possible that the market took solace in the fact that wages did not rise as much as anticipated. In any case, average hourly earnings have been very volatile and subject to frequent revisions, so this move could fade as results are fully digested and interpreted. The situation with SVB Financial may also explain part of today\u2019s reaction: traders are very apprehensive about the possibility of a banking crisis in response to the Fed\u2019s extremely hawkish stance to the point that they will take any sliver of good news and run on it.\nFED FUNDS FUTURES, TREASURY YIELDS AND US DOLLAR CHART\n\nSource: TradingView\nOriginal post at 9:45 am ET\nU.S. employers continued to add to their ranks at a robust pace last month, but hiring momentum decelerated compared to the start of the year, a welcome development for Fed officials who have launched one of the most aggressive tightening campaigns in decades to slow the economy in their quest to return inflation to the 2% target.\nAccording to the Bureau of Labor Statistics (BLS), payrolls rose by 311,000 in February, versus 205,000 expected, following a downwardly revised increase of 504,000 in January. Meanwhile, the unemployment rate climbed to 3.6%, two-tenths of a percent above consensus estimates, with the move likely driven by the increase in the labor force participation, which inched up to 62.5% from 62.4%.\nUS LABOR MARKET DATA CHARTS\n\nSource: U.S. Department of Labor\nElsewhere in the BLS\u2019s survey, average hourly earnings, an important inflation indicator for the central bank, climbed 0.2% on a monthly basis, pushing the annual rate to 4.6% from 4.4% previously. The median forecast in a Reuters poll of economists called for earnings to rise 0.3% month-over-month and 4.7% year-on-year.\n\n\n\nRecommended by                    Diego Colman\n\n\nGet Your Free Equities Forecast\n\n\n\nLABOR MARKET DATA AT A GLANCE\n\nSource: DailyFX Economic Calendar\nWhile solid job growth can be concerning at a time of labor market tightness, the fact that employment costs are not rising as fast as feared can be seen as a positive signal for the Fed\u2019s efforts to restore price stability. One month\u2019s report is not enough to make broad conclusions, but it is encouraging nonetheless.\nWith the NFP data in the rearview mirror, attention will now turn to the U.S. February inflation report, which will be released next Tuesday. Headline CPI is seen cooling to 6.0% y-o-y from 6.4% in January, while the core gauge is forecast to clock in at 5.5% from 5.6% previously.\nIn terms of possible scenarios, hotter-than-anticipated data could revive expectations for faster tightening, putting back in play a half-a-point interest rate rise rather than a 25 basis point hike. On the flip side, softer-than-forecast results could help quiet the hawkish narrative, solidifying calls for less aggressive tightening over the forecast horizon.\nStay tuned for market reaction and analysis\nWritten by Diego Colman, Contributing Strategist for DailyFX\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"US Economy Adds Strong 311,000 Jobs, Wages Grow Less Than Expected","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/100-ZQH2023_2023-03-10_09-16-03_554d7.png"},{"post_url":"https:\/\/psxon.com\/japanese-yen-plunges-vs-us-dollar-as-boj-keeps-policy-settings-unchanged\/","description":"The Japanese yen fell sharply against the US dollar on Friday after the Bank of Japan left interest rates unchanged","date":"March 10, 2023","views":0,"post_id":172,"content":"\nThe Japanese yen fell sharply against the US dollar on Friday after the Bank of Japan left interest rates unchanged and maintained its current bond-yield curve control policy settings.\nIn his last meeting as the BOJ Governor Haruhiko Kuroda left policy settings steady, in line with expectations, given the Japanese central bank adjusted the yield band as recently as December. Incoming BOJ Governor Kazuo Ueda has said the central bank must maintain its current ultra-easy policy for now until there are signs that inflation has sustained above BOJ\u2019s 2% target.\nUSD\/JPY 5-minute Chart\n\nChart Created Using TradingView\nUeda has attempted to cool speculation of an earlier-than-expected normalization of policy rates, but for financial markets, policy tweaks could come in sooner rather than later given the distortions caused by the yield curve control policy and inflation at a four-decade high. The focus now shifts to the next BOJ meeting April 27-28, Ueda\u2019s first meeting as the chair. Ueda has said he has ideas on how the central bank could exit its massive stimulus, but monetary tightening is a possibility only if big improvements are made in Japan\u2019s \u2018trend inflation\u2019.\nJGB 10-Year Yield Vs Japan 10-Year Swap Rate Chart\n\nSource: Bloomberg\nThe immediate focus for markets shifts to US jobs data due later today \u2013 growth of the non-farm payroll likely slowed to 224,000 in February, slower from 443,000 in January, and unemployment is expected to hold near the five-decade low of 3.4%. In his semi-annual testimony to Congress,US Fed Chair Powell stepped up hawkishness, saying the ultimate rate peak is likely to be higher than expected and the central bank is prepared to increase the pace of rate hikes, depending on incoming data.\nOn technical charts, USD\/JPY has struggled to cross above a solid cap of around 137.00-138.20, including the 200-day moving average and the December high of 138.20. For more discussion, see \u201cJapanese Yen Forecast: High Bar for USD\/JPY to Crack Resistance\u201d, published February 26.\nUSD\/JPY 240-minute Chart\n\nChart Created Using TradingView\nThe failure to sustain gains this week above a brief break above resistance at the early-March high of 137.09 is a sign that USD\/JPY\u2019s six-week-long rally is losing steam. However, the pair would need to break below support on a horizontal trendline from mid-February at about 135.25 to confirm that the upward pressure is fading.\n\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\n\u2014 Written by Manish Jaradi, Strategist for DailyFX.com\n\u2014 Contact and follow Jaradi on Twitter: @JaradiManish\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Japanese Yen Plunges Vs US Dollar As BOJ Keeps Policy Settings Unchanged","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1678422130_image1.png"},{"post_url":"https:\/\/psxon.com\/sp-500-nasdaq-100-perk-up-but-risk-appetite-remains-subdued-ahead-of-nfp-data\/","description":"EQUITY MARKET OUTLOOK: The S&P  and Nasdaq  advance after Tuesday\u2019s selloff, but gains are modest as Powell\u2019s hawkish","date":"March 9, 2023","views":500100,"post_id":169,"content":"\nEQUITY MARKET OUTLOOK:\n\nThe S&P 500 and Nasdaq 100 advance after Tuesday\u2019s selloff, but gains are modest as Powell\u2019s hawkish message limits risk appetite\nLack of directional conviction suggests many traders remain on the sidelines ahead of key U.S. economic data that may help clarify the Fed\u2019s tightening roadmap\nAll eyes are now on the U.S. nonfarm payrolls report due out on Friday morning\n\n\n\n\nRecommended by                    Diego Colman\n\n\nGet Your Free Equities Forecast\n\n\n\nMost Read: Precious Metals Lose Shine After Powell; What\u2019s Next for Gold and Silver?\nU.S. stocks wavered and lacked directional conviction on Wednesday as traders continued to digest Federal Reserve Chair Jerome Powell\u2019s hawkish comments during his semiannual testimony before Congress. When it was all said and done, the S&P 500 and Nasdaq 100 finished the day modestly higher after the previous session\u2019s sell-off, with the former advancing 0.14% to 3,992 and the latter climbing 0.52% to 12,215.\nThe main takeaway from Powell\u2019s two-day hearing in Washington was that the FOMC\u2019s peak rate is likely to rise more than initially anticipated and that the institution is prepared to accelerate the pace of tightening if the totality of information were to require stronger measures.\nMarkets were quick to react to Powell\u2019s aggressive message, repricing higher the hiking path and solidifying bets for a 50 bp interest rate rise at the March FOMC meeting. These expectations could consolidate if the economy retains momentum, so it is important to closely watch incoming data to better assess future policy actions.\nOne major economic report that traders should carefully examine this week is the February U.S. employment survey. Consensus estimates predict the U.S. economy added 205,000 jobs last month, but robust payroll gains in the private sector suggest hiring remained remarkably solid.\nTight labor markets are likely to keep wage growth biased to the upside and sustain steady household spending over the medium term, reinforcing price pressures in the economy at a time when CPI is running more than three times faster than the 2.0% long-term target.\n\n\n\nRecommended by                    Diego Colman\n\n\nTraits of Successful Traders\n\n\n\nEQUITY MARKET OUTLOOK\nUpside inflation risks may prompt the Fed to revert to more forceful tactics, increasing the likelihood that the terminal rate will have to settle in the vicinity of 6.0% and stay there for an extended period of time \u2013 a bearish outcome for the equity space.\nWith bonds offering increasingly attractive yields that top 5.0% at short-dated maturities, it is difficult to see investors steadily deploying capital into riskier assets such as stocks, especially as the corporate earnings outlook remains weak and the extreme inversion of the yield curve screams recession. For those reasons, both the S&P 500 and the Nasdaq 100 will have difficulty mounting a durable recovery.\nFED FUNDS FUTURES IMPLIED YIELD, TREASURY YIELDS & 2s10s CURVE\n\nSource: TradingView\n\n\n\nof clients are net long.    of clients are net short.    \n\n\n\n\n\n\n\n\nChange in        \n\nLongs        \n\nShorts        \n\nOI        \n\n\n\n\nDaily\n0%\n2%\n1%\n\n\nWeekly\n-10%\n9%\n-2%\n\n\n\n\nS&P 500 TECHNICAL ANALYSIS\nThe S&P 500 defended the 200-day simple moving average after February\u2019s pullback, but hasn\u2019t been able to rebound meaningfully from those levels; in fact, prices are still stuck below the ascending trendline that guided the recovery off the October 2022 lows, a sign of little of bullish conviction.\nWith many traders on the sidelines, while waiting for the next NFP report, the index could remain somewhat directionless over the next 24 hours, but volatility is likely to pick up heading into the weekend.\nHaving said that, on a move lower, initial support appears at 3,940, followed by 3,890. On further weakness, the focus shifts to the December 2022 lows near 3,765. In contrast, on a move higher, the first resistance to consider comes in at 4,025 and 4,100 thereafter. After that, the next area of interest is located slightly below the psychological 4,200 mark.\nS&P 500 TECHNICAL CHART\n\nS&P 500 Chart Creating in TradingView\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"S&P 500, Nasdaq 100 Perk Up but Risk Appetite Remains Subdued ahead of NFP Data","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1678337684_image1.png"},{"post_url":"https:\/\/psxon.com\/dow-jones-sp-500-plunge-on-powell-testimony-is-a-larger-fed-rate-hike-next\/","description":"Dow Jones, S&P , Powell Testimony \u2013 Asia Pacific Market Open: Dow Jones, S&P  plunge after Jerome Powell testimony","date":"March 8, 2023","views":500500,"post_id":166,"content":"\nDow Jones, S&P 500, Powell Testimony \u2013 Asia Pacific Market Open:\n\nDow Jones, S&P 500 plunge after Jerome Powell testimony\nThe chair of the Fed offered an increasingly hawkish view\nMarkets are starting to favor 50-basis point hike this month\nAsia-Pacific markets are bracing for volatility on Wednesday\n\n\n\n\nRecommended by                    Daniel Dubrovsky\n\n\nGet Your Free Equities Forecast\n\n\n\nAsia-Pacific Market Briefing \u2013 Markets Bracing After Wall Street Volatility\nWall Street received a reality check on Tuesday as the Dow Jones and S&P 500 sank 1.72% and 1.53%, respectively. The key culprit was what traders were anxiously anticipating, testimony from Federal Reserve Chair Jerome Powell before the Senate Banking Committee.\nThe key takeaway from Mr. Powell was that he noted that the central bank was prepared to speed up the pace of hikes again if warranted. Of course, this would continue to be influenced by incoming economic data. Furthermore, he noted that the Fed is likely looking at a higher rate peak than expected.\nThis testimony follows recent signs that inflation might be stickier than previously seen. The latest CPI and PCE report (the latter of which is the central bank\u2019s preferred inflationary gauge) showed signs that the pace of disinflation slowed.\nBy the end of the day, market pricing started to favor a 50-basis point rate hike this month as opposed to 25. Treasury yields soared, sapping the appeal of stocks, inducing classic risk aversion. This leaves Asia-Pacific markets vulnerable heading into Wednesday\u2019s trading session.\nDow Jones Technical Analysis\nThe Dow Jones turned lower after rejecting the 50-day Simple Moving Average (SMA). This also followed a breakout under a Symmetrical Triangle chart formation. This is placing the focus on immediate support, which is the 38.2% Fibonacci retracement level at 32709.\n\n\n\nRecommended by                    Daniel Dubrovsky\n\n\nGet Your Free Top Trading Opportunities Forecast\n\n\n\nDaily Chart\n\nChart Created in TradingView\nS&P 500 Technical Analysis\nMeanwhile, the S&P 500 rejected the ceiling of a bearish Rising Wedge chart formation. This is leaving the index also facing the 38.2% Fibonacci retracement level, which here is sitting at 3938.61. Confirming a breakout under the latter would open the door to an increasingly bearish technical bias.\nDaily Chart\n\nChart Created in TradingView\n\u2014 Written by Daniel Dubrovsky, Senior Strategist for DailyFX.com\nTo contact Daniel, follow him on Twitter:@ddubrovskyFX\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Dow Jones, S&P 500 Plunge on Powell Testimony. Is a Larger Fed Rate Hike Next?","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1678249704_image1.png"},{"post_url":"https:\/\/psxon.com\/australian-dollar-slides-after-rbas-widely-expected-25-basis-point-hike\/","description":"AUD\/USD, Australian dollar \u2013 Talking Points: AUD\/USD plunged after RBA\u2019s widely expected bps rate hike. Key focus is now on","date":"March 7, 2023","views":25,"post_id":163,"content":"\nAUD\/USD, Australian dollar \u2013 Talking Points:\n\nAUD\/USD plunged after RBA\u2019s widely expected 25bps rate hike.\nKey focus is now on US Fed Chair Powell\u2019s testimony to lawmakers later today and tomorrow.\nWhat is the outlook on AUD\/USD?\n\n\n\n\nRecommended by                    Manish Jaradi\n\n\nHow to Trade AUD\/USD\n\n\n\nAUD\/USD plunged after the Reserve Bank of Australia hiked the benchmark cash rate by 25 basis points in an attempt to control inflation running at three-decade highs.\nThe Reserve Bank of Australia raised the cash rate by a quarter percentage point to 3.60% and said further tightening of monetary policy will be needed. The move was widely expected after inflation rose to a three-decade high last quarter, well above the central bank\u2019s target range of 2%-3%. Last month, the bank abandoned its previous plan to pause at 3.35% and signaled more hikes would be needed. The RBA is not an exception in warning of further tightening. Central bankers, including the US Fed and the European Central Bank, have said more work needs to be done to tackle inflation.\nAUD\/USD 5-minute Chart\n\nChart Created by Manish Jaradi; Source: TradingView\nMeanwhile, China on Sunday set a growth target of around 5%, below last year\u2019s target of around 5.5% at the annual session of its National People\u2019s Congress. The target was at the lower end of the range expected by analysts, weighing on AUD\/USD. However, stronger-than-expected China manufacturing and services activity data last week indicates that the economic reopening is beginning to show in activity data. Given that China is Australia\u2019s biggest export market, any improvement in China\u2019s growth outlook could boost Australia\u2019s growth prospects.\nFor now, though, the focus is on US Fed Chair Powell\u2019s semi-annual testimony to lawmakers later today and tomorrow. His remarks will be closely watched as financial markets look for further guidance on monetary policy given strong US data in recent weeks. In particular, markets will be watching for cues regarding the Fed\u2019s hiking path, particularly if policymakers are contemplating resorting to aggressive rate hikes. In his previous appearance a month ago, Powell emphasized the \u2018disinflation\u2019 theme and stopped short of adopting an aggressive tone following a solid US jobs report. US rate futures are pricing in the Fed\u2019s target rate to peak around 5.48% in September from the current 4.50-4.75%, compared with under 5% at the end of January.\nAustralia Rates Expectations\n\nChart Created by Manish Jaradi; Source: Bloomberg\nIn contrast, Australia\u2019s macro data since the beginning of March have been underwhelming, as reflected in the Economic Surprise Indices (ESI) \u2013 the Australian ESI is languishing around the 2020 lows, while its US counterpart is at the highest level in 10 months. The diverging growth outlook has weighed on AUD\/USD in recent weeks.\nAUD\/USD Daily Chart\n\nChart Created Using TradingView\nOn technical charts, AUD\/USD has faced stiff resistance at last week\u2019s high of 0.6780, roughly coinciding with the 89-period moving average and the upper edge of the Ichimoku cloud on the 240-minute charts. Since the decline began in February, AUD\/USD hasn\u2019t been able to cross the 89-PMA and the upper edge of the Ichimoku cloud, so a break above would raise the odds that the pair has found an interim floor. Such a break could pave the way toward the late-February high of 0.6920.\nOn the downside, AUD\/USD has quite a strong cushion at the late-November low of 0.6585 \u2013 the pair needs to hold above the support for the four-month-long uptrend to remain intact.\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\n\u2014 Written by Manish Jaradi, Strategist for DailyFX.com\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Australian Dollar Slides After RBA\u2019s Widely Expected 25-Basis Point Hike","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1678165086_image1.png"},{"post_url":"https:\/\/psxon.com\/japanese-yen-firms-ahead-of-powell-and-boj-as-us-dollar-pauses-where-to-for-usd-jpy\/","description":"The Japanese Yen could be in for a bumpy ride this week with Fed Chair Powell set to testify and","date":"March 6, 2023","views":0,"post_id":160,"content":"\n\nThe Japanese Yen could be in for a bumpy ride this week with Fed Chair Powell set to testify and a Bank of Japan meeting amongst other data could be pivotal for USD\/JPY direction.\nJapanese Yen, USD\/JPY, US Dollar, BoJ, Powell, Fed, Treasury Yields \u2013 Talking Points\n\nThe Japanese Yen grabbed some ground on Friday and is steady to start the week\nThe BoJ looks likely to be on hold at their monetary policy meeting this Friday\nPowell\u2019s commentary could shift Treasury yields. Will that tilt USD\/JPY as well?\n\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\nThe Japanese Yen has found some strength from easing Treasury yields, and they might be the key for USD\/JPY in the week ahead.\nCrucially, Federal Reserve Bank Chair Jerome Powell will be testifying in front of the Senate Banking Committee when he delivers his semi-annual Monetary Policy Report on Tuesday and Wednesday, US time.\nHis comments will go under the microscope for clues on his thinking for the Fed funds target rate going forward.\nAny hint that the bank is backing away from its hawkish stance might kick-start markets and may see a further easing of Treasury yields. Of course, if the tightening path is maintained and potentially further emphasised, it could see yields lift.\nThe futures and swaps markets are pricing in at least a 25 basis point tightening at the March, May and June Federal Open Market Committee (FOMC) meetings.\n\n\n\nRecommended by                    Daniel McCarthy\n\n\nHow to Trade USD\/JPY\n\n\n\nAlso ahead this week, the Bank of Japan\u2019s (BoJ) monetary policy decision will be made on Friday although the market is not expecting any changes there.\nThe BoJ has a policy rate of -0.10% and is maintaining yield curve control (YCC) by targeting a band of +\/- 0.50% around zero for Japanese Government Bonds (JGBs) out to 10 years. The 10-year JGB is persistently trading near the upper bound of 0.50%.\nThe incoming Governor of the Bank of Japan (BoJ) Kazuo Ueda made it clear last week that he will be maintaining the same stance as outgoing Governor Haruhiko Kuroda.\nAt least for now, that is. There is growing speculation that the policy could be adjusted in the second or third quarter in a similar move as last December when the YCC band was widened from +\/- 0.25% to +\/- 0.50%\nSo, with the BoJ\u2019s policy on hold, the Fed\u2019s active stance might remain the driver for USD\/JPY for now.\nBesides Powell\u2019s testimony and the BoJ meeting, US jobs data and Japanese GDP figures are due out this week and could trigger market volatility.\nUSD\/JPY AGAINST 2- AND 10-YEAR TREASURY YIELDS\n\nChart created in TradingView\n\u2014 Written by Daniel McCarthy, Strategist for DailyFX.com\nPlease contact Daniel via @DanMcCathyFX on Twitter\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Japanese Yen Firms Ahead of Powell and BoJ as US Dollar Pauses. Where to for USD\/JPY?","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1678076680_image1.png"},{"post_url":"https:\/\/psxon.com\/speculative-frenzy-at-risk-ahead-of-key-us-jobs-report\/","description":"STOCK MARKET WEEK AHEAD OUTLOOK: BEARISH TO NEUTRAL S&P  and Nasdaq  close the week higher despite rising Treasury","date":"March 5, 2023","views":500100,"post_id":157,"content":"\nSTOCK MARKET WEEK AHEAD OUTLOOK: BEARISH TO NEUTRAL\n\nS&P 500 and Nasdaq 100 close the week higher despite rising Treasury yields\nThe Fed\u2019s hawkish monetary policy outlook remains a key risk for stocks\nPowell\u2019s testimony before Congress and the February U.S. employment report will take the spotlight next week\n\n\n\n\nRecommended by                    Diego Colman\n\n\nGet Your Free Equities Forecast\n\n\n\nMost Read: USD\/JPY Retains Bullish Outlook, Fundamentals Undermine the Japanese Yen\nU.S. bond yields extended their recent rally this past week despite a moderate pullback on Friday, rising across most maturities amid a hawkish repricing of the Fed\u2019s monetary policy outlook in the wake of hotter-than-expected economic data. At one point on Thursday, the entire Treasury curve topped 4.0% as expectations for the FOMC\u2019s terminal rate drifted upwards and traders started to brace for a \u201chigher-for-longer\u201d interest rate regime in response to sticky inflation.\nCounterintuitively, both the S&P 500 and Nasdaq 100 managed to close the week with solid gains, up about 1.9% and 2.6%, respectively, shrugging off volatility in the fixed income space and surprising investors who had anticipated more subdued performance due to Fed jitters.\nHowever, the strength in equity markets could reverse early next week, ahead of the release of a key U.S. macro report on Friday, March 10: the February U.S. employment report. Fed chairman Powell\u2019s semi-annual testimony before Congress could also rattle positive sentiment if he embraces a forceful tone following the latest string of strong macro numbers.\n2023 FED FUNDS FUTURES & US TREASURY YIELDS CHART\n\nSource: TradingView\nTraders may be tempted to start trimming exposure to risk assets and stay on the sidelines in the coming days to avoid stepping into \u201chawkish rhetoric\u201d or, more importantly, a \u201chawkish datapoint\u201d that could provide confirmation that the U.S. economy is holding up remarkably well and will likely require additional monetary tightening. This scenario could lead to some selling on Wall Street, biasing both the S&P 500 and Nasdaq 100 to the downside in the very near term.\nFocusing on the incoming nonfarm payrolls survey (NFP), U.S. employers are forecast to have added 200,000 workers last month, after hiring a whopping 517,000 people in January. Nevertheless, persistently low jobless claims in recent weeks, coupled with a sturdy rebound in the ISM services\u2019 employment index, suggest labor market data could handily exceed consensus estimates.\nUS EMPLOYMENT REPORT EXPECTATIONS\n\nSource: DailyFX Economic Calendar\nAnother hot NFP report will raise the risks that the Fed will ultimately do more to slow the economy to prevent elevated wage growth and demand pressures from exacerbating inflationary forces, which are showing tentative signs of regaining momentum. This means policymakers could start frontloading hikes again, while simultaneously signaling a higher peak rate of around 6.0%. Obviously, this would be a negative outcome for the stock market capable of undermining equities in the near term.\n\n\n\nof clients are net long.    of clients are net short.    \n\n\n\n\n\n\n\n\nChange in        \n\nLongs        \n\nShorts        \n\nOI        \n\n\n\n\nDaily\n-14%\n7%\n-5%\n\n\nWeekly\n-11%\n12%\n-1%\n\n\n\n\nNASDAQ 100 TECHNICAL ANALYSIS\nAfter finding technical support and rebounding off its 200-day simple moving average, the Nasdaq 100 has charged higher, with bulls now eyeing short-term trendline resistance near 12,400. If traders manage to push the tech index above this barrier in the coming sessions, buying interest could pick momentum, paving the way for a move towards 12,675, followed by 12,870, the 38.2% Fibonacci retracement of the November 2021\/October 2022 slump. On the flip side, if sellers regain decisive control of the market and trigger a bearish reversal, initial support appears at 11,900\/11,820. If this area is taken out, bears could launch an attack on 11,655, the 50% Fib retracement of the October 2022\/February 2023 rally.\nNASDAQ 100 TECHNICAL CHART\n\nNasdaq 100 Chart Prepared Using TradingView\nWritten by Diego Colman, Contributing Strategist for DailyFX\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Speculative Frenzy at Risk ahead of Key US Jobs Report","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1677992470_image1.png"},{"post_url":"https:\/\/psxon.com\/pound-eyes-uk-gdp-alongside-us-nfp\/","description":"POUND STERLING ANALYSIS & TALKING POINTS Will Chinese positivity follow through next week benefitting risk assets? UK GDP and Fed","date":"March 4, 2023","views":0,"post_id":154,"content":"\nPOUND STERLING ANALYSIS & TALKING POINTS\n\nWill Chinese positivity follow through next week benefitting risk assets?\nUK GDP and Fed speak in focus next week.\nGBP\/USD hesitance awaiting fundamental catalyst.\n\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\nGBPUSD FUNDAMENTAL BACKDROP\nThe British pound found some support on Friday with UK services data PMI as well as renewed risk appetite after better than expected Chinese PMI figures. The China re-open story has started to gain traction again allowing risk assets like the GBP to flourish. The key theme for next week remains in line with data dependency and while the Bank of England (BoE) has been erring on the side of caution in terms of their forward guidance, the US seems to be sticking with the hawkish narrative. That being said, market reactions to central bank speak have been on the decline as there has not been much change in forward guidance from Fed officials. This has given economic data more significance however; Fed Chair Jerome Powell who is scheduled to speak next week should bring about more attention relative to the other Fed officials.\nNon-Farm Payroll (NFP) data (see economic calendar below) will take center stage from a US perspective, after persistence robust labor data. This has been supplementing the aggressive approach from the Fed (which is largely priced in). With expectations baked into the upside, any miss on data should result in a positive move for the pound.\n\n\n\nRecommended by                    Warren Venketas\n\n\nHow to Trade GBP\/USD\n\n\n\nFrom a UK perspective, UK GDP will be in focus and is expected to dip below 0% and should actual data fall in line, recessionary fears will be renewed, likely hampering GBP upside.\nECONOMIC CALENDAR\n\nSource: DailyFX Economic Calendar\nTECHNICAL ANALYSIS\nGBP\/USD DAILY CHART\n\nChart prepared by Warren Venketas, IG\nDaily GBP\/USD price action although weakening against the greenback, is keeping in touch with the 1.2000 psychological handle, seeking a breakout above the falling wedge chart pattern (black). As mentioned above, data will be the key driver of a breakout which could be confirmed by a candle close above or below the wedge formation.\nKey resistance levels:\n\n1.2100\nWedge resistance\n1.2000\n\nKey support levels:\nBEARISH IG CLIENT SENTIMENT\nIG Client Sentiment Data (IGCS) shows retail traders are currently LONG on GBP\/USD, with 61% of traders currently holding long positions (as of this writing). At DailyFX we typically take a contrarian view to crowd sentiment resulting in a short-term downside disposition.\nContact and followWarrenon Twitter:@WVenketas\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Pound Eyes UK GDP Alongside US NFP","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1677904280_image1.png"},{"post_url":"https:\/\/psxon.com\/us-dollar-bounces-back-again-as-the-fed-and-ecb-map-out-rate-hikes-higher-usd\/","description":"US Dollar, DXY Index, Fed, ECB, Euro, EUR\/USD \u2013 Talking points The US Dollar has eased after a stellar rally","date":"March 3, 2023","views":0,"post_id":151,"content":"\n\nUS Dollar, DXY Index, Fed, ECB, Euro, EUR\/USD \u2013 Talking points\n\nThe US Dollar has eased after a stellar rally overnight\nTreasury yields are on the march again, underpinning the DXY Index\nIf the US Dollar contuse to gain, how low will EUR\/USD go?\n\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\nThe US Dollar rallied again overnight after hawkish comments from Boston Fed President Susan Collins highlighting that interest rates will need to be lifted and the extent of the rises will be data dependent.\nBetter-than-expected jobless claims also buoyed the mood before Raphael Bostic from the Atlanta Fed tempered the celebrations by suggesting that rates may peak in the coming summer. Although he did say that raising rates slowly and steadily was the right course of action.\nFederal Reserve Governor Christopher Waller also chimed after the bell and said that rate hikes could be more aggressive if the data warranted it.\nNonetheless, the overnight index swap (OIS) and futures markets are pricing in a 25 basis point hike at the next 3 Federal Open Market Committee (FOMC) meetings. At one stage overnight the futures market was implying a terminal rate from the Fed of almost 5.5%. A long way from the 4.90% that was priced back in January.\nTreasury yields continued their trot toward new highs with the 2-year bond trading at 4.94%, the highest since July 2007 while the benchmark 10-year note is ensconced above 4%, as it nudged 4.09%\n\n\n\nRecommended by                    Daniel McCarthy\n\n\nHow to Trade EUR\/USD\n\n\n\nThe DXY index retraced the previous day\u2019s losses into the New York close, but it has eased slightly into the Asian session.\nThe DXY index is a US Dollar index that is weighted against EUR (57.6%), JPY (13.6%), GBP (11.9%), CAD (9.1%), SEK (4.2%) and CHF (3.6%).\nWhile the Fed is concerned about ensuring they are in front of the curve when it comes to tightening, the European Central Bank appear to be playing catch up as inflation data there re-accelerated.\nYesterday, the Euro-wide month-on-month CPI jumped to 0.8% for February, well above the 0.5% anticipated and -0.2% prior. The year-on-year read was 8.5% rather than 8.3% forecast and 8.6% previously.\nThe OIS market has a 50 basis points lift by the European Central Bank (ECB) at its meeting in 2 weeks\u2019 time with potentially more hikes of 50 down the track. EUR\/USD slipped under 1.0600 yesterday but it has recovered somewhat.\nWhile San Francisco Fed President Mary Daly will be speaking later today, the focus will be on Fed chair Jerome Powell next week. He will be testifying in front of the Senate Banking Committee when he presents his semi-annual Monetary Policy Report on Tuesday\nDXY INDEX AGAINST TREASURY 2- AND 10-YEAR YIELDS\n\nChart Created in TradingView\n\u2014 Written by Daniel McCarthy, Strategist for DailyFX.com\nTo contact Daniel, use the comments section below or @DanMcCathyFX on Twitter\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"US Dollar Bounces Back Again as the Fed and ECB Map Out Rate Hikes. Higher USD?","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1677823464_image1.png"},{"post_url":"https:\/\/psxon.com\/japanese-yen-flatlines-despite-us-dollar-weakness-will-treasury-yields-lift-usd-jpy\/","description":"Japanese Yen, USD\/JPY, US Dollar, BoJ, Fed, Treasury Yields, MOVE, Volatility \u2013 Talking Points The Japanese Yen appears listless while","date":"March 2, 2023","views":0,"post_id":148,"content":"\n\nJapanese Yen, USD\/JPY, US Dollar, BoJ, Fed, Treasury Yields, MOVE, Volatility \u2013 Talking Points\n\nThe Japanese Yen appears listless while the US dollar grapples for grip\nThe BoJ looks likely to keep monetary unchanged for now while the Fed tightens\nTreasury yields and bond market volatility might be saying something about USD\/JPY\n\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\nThe Japanese Yen has been steady so far this week in a period where the US Dollar has broadly weakened against most G-10 peers.\nThe lack of strength in the Yen might be reflecting the perception that the incoming Governor of the Bank of Japan (BoJ) Kazuo Ueda will maintain the ultra-loose monetary policy stance of his predecessor.\nThe BoJ has a policy rate of -0.10% and is maintaining yield curve control (YCC) by targeting a band of +\/- 0.50% around zero for Japanese Government Bonds (JGBs) out to 10 years.\nThe 10-year JGB is consistently bumping up against the upper bound of 0.50% as the market continually tests the resolve of the bank in the face of rising yields globally.\nThere is speculation that YCC might be adjusted in the second or third quarter this year, having been loosened in December.\n\n\n\nRecommended by                    Daniel McCarthy\n\n\nHow to Trade USD\/JPY\n\n\n\nWhile the BoJ maintains its dovish stance, the Federal Reserve continues to roll out the hawkish message. Overnight it was Atlanta Fed President Raphael Bostic and Minneapolis Fed President Neel Kashkari waving the rate rise flag.\nThe latter said that he is \u2018open-minded\u2019 about a 25 or 50 basis point lift in the Fed funds target rate at the next Federal Open Market Committee (FOMC) meeting in 3 weeks. Both reiterated the need to get inflation under control.\nUS Treasury yields are marching north again with the 10-year mote eclipsing 4% again overnight while the 2-year bond made a fresh 15-year peak above 4.90%. If the greenback picks up steam again, a bullish USD\/JPY trajectory could unfold further.\nAn interesting evolution in this run-up in US yields has been the relatively benign reaction in volatility. The MOVE index measures Treasury bond market volatility in a similar way that the VIX index measures volatility on the S&P 500.\nThe last time US yields were up at these levels, the MOVE index was also at a higher level than where it is currently.\nThis might imply that the market is more comfortable with this increase in interest rates this time around than previously, potentially allowing rates to stay elevated or possibly go higher still.\nIf the correlation between USD\/JPY and Treasury yields holds, USD\/JPY could be underpinned for now.\nUSD\/JPY, MOVE INDEX, US 2- and 10-YEAR TREASURY YIELDS\n\nChart created in TradingView\n\u2014 Written by Daniel McCarthy, Strategist for DailyFX.com\nPlease contact Daniel via @DanMcCathyFX on Twitter\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Japanese Yen Flatlines Despite US Dollar Weakness. Will Treasury Yields Lift USD\/JPY?","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/1677731783_image1.png"},{"post_url":"https:\/\/psxon.com\/australian-dollar-dunked-after-gdp-miss-provides-volatility-will-aud-usd-go-lower\/","description":"Australian Dollar, AUD\/USD, GDP, S&P ASX , CPI, RBA -Talking Points The Australian Dollar has lost ground after GDP disappointed","date":"March 1, 2023","views":200,"post_id":145,"content":"\n\nAustralian Dollar, AUD\/USD, GDP, S&P ASX 200, CPI, RBA -Talking Points\n\nThe Australian Dollar has lost ground after GDP disappointed\nStagflation might undermine the prospect of a soft landing\nThe RBA is anticipated to hike next week. Is that good or bad for AUD?\n\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\nThe Australian Dollar sunk below 67 cents after 4Q quarter-on-quarter GDP came in at 0.5% rather than the 0.8% forecast and against the previous 0.7% that was revised up from 0.6%. The currency recovered later in the day on solid Chinese data.\nAnnual GDP to the end of December was 2.7% as anticipated reveal more upward revisions to prior quarters. The prior read was 5.9%.\nToday\u2019s GDP figures arrive ahead of the Reserve Bank of Australia\u2019s monetary policy meeting next Tuesday. They are anticipated to increase their cash rate target by 25 basis points (bp) to 3.60%. If they do, it will be the tenth hike since the lift-off in May last year.\nThe latest inflation read is way above the RBA\u2019s target band of 2-3% at 7.8% year-on-year. Today\u2019s data comes on the back of yesterday\u2019s retail sales and current account.\nThe fourth quarter current account surplus came in at AUD 14.1 billion against AUD 5.5 forecast and the previous print revised up to AUD 0.8 billion from AUD -2.3 billion.\nMonth-on-month retail sales for January were up 1.9% rather than 1.5% anticipated and -4.0% prior.\nThe fundamental data points toward mixed signals for the economy but the RBA seem to have little choice but to tighten further in the near term with inflation so rampant.\nThe picture down the track seems to be somewhat opaque with a high degree of uncertainty. Some leading indicators might be a harbinger of the headwinds ahead. Housing prices have continued to slip lower and business sentiment surveys are deteriorating.\n\nSource; Bloomberg\n\nSource; Bloomberg\nPotentially compounding the problem could be the so-called \u2018mortgage cliff\u2019 where fixed rate borrowers will be re-adjusting the repayments at over 300 bp higher.\nAll of this illustrates the tricky road ahead for the RBA. The latest unemployment data showed the labour market loosening a fraction but still relatively tight by historical measures with the unemployment rate at 3.7%. Reining in price pressures at a time of softening aggregate demand might lead to deepening stagflation.\nThis scenario might be bearish for AUD\/USD but in turn, a lower exchange rate may assist the domestic economy, especially if China is able to ignite its growth plans. The upcoming National; People\u2019s Congress (NPC), which starts this weekend, may offer some insights into this prospect.\n\n\n\nRecommended by                    Daniel McCarthy\n\n\nHow to Trade AUD\/USD\n\n\n\n\u2014 Written by Daniel McCarthy, Strategist for DailyFX.com\nPlease contact Daniel via @DanMcCathyFX on Twitter\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Australian Dollar Dunked After GDP Miss Provides Volatility. Will AUD\/USD Go Lower?","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/03\/image1.png"},{"post_url":"https:\/\/psxon.com\/australian-dollar-pauses-after-trend-break-where-to-for-aud-usd\/","description":"Australian Dollar, AUD\/USD, US Dollar, Current Account, GDP \u2013 Talking Points The Australian Dollar adjourned the bearish run this week","date":"February 28, 2023","views":0,"post_id":142,"content":"\n\nAustralian Dollar, AUD\/USD, US Dollar, Current Account, GDP \u2013 Talking Points\n\nThe Australian Dollar adjourned the bearish run this week\nRetail sales and the current account surplus beat expectations\nThe trend has been broken for now. What does it say about AUD\/USD?\n\n\n\nTrade Smarter \u2013 Sign up for the DailyFX Newsletter\nReceive timely and compelling market commentary from the DailyFX team\n\n\nSubscribe to Newsletter\n\nThe Australian Dollar has consolidated through the early part of this week after tumbling over 2% last week. That move was triggered by the US Dollar roaring higher on perceptions of a more hawkish Federal Reserve.\nDomestic data released today reveal the underlying strength of the economy going into the end of last year and into 2023.\nThe fourth quarter current account surplus came in at AUD 14.1 billion against AUD 5.5 forecast and the previous print revised up to AUD 0.8 billion from AUD -2.3 billion.\nMonth-on-month retail sales for January were up 1.9% rather than 1.5% anticipated and -4.0% prior.\nKeeping in mind that year-on-year CPI to the end of 2023 was 7.8%, the economy is running hot up to this point in time. When it comes to monetary policy for the RBA going forward, the issue is the impact of 325 basis points worth of tightening for fixed-rate borrowers when their loans roll off this year.\nA problem measuring the potential impact of this dynamic lies in the available data being at a macro level rather than the ability to drill down.\nHouseholds that will see large increases in borrowing costs might have large reserves built up or other means to deal with the situation. Or perhaps not.\nThe RBA collect data from the major banks and will be able to get a better handle on the circumstances than the rest of the market.\nIn any case, the incoming data throughout this year is likely to be highly scrutinised for the impacts or otherwise of these fixed-rate loans rolling off.\nAUD\/USD appears to be more vulnerable to sways in global sentiment for now, rather than the state of the domestic economy.\nIf the exchange rate continues to trade near these levels, the current account and trade surpluses seem like they will continue to make a positive contribution.\nAccording to a Bloomberg survey of economists, GDP data tomorrow is anticipated to show growth of 0.7% q\/q for the fourth quarter and 2.9% y\/y to the end of 2023.\n\n\n\nRecommended by                    Daniel McCarthy\n\n\nHow to Trade AUD\/USD\n\n\n\nAUD\/USD TECHNICAL ANALYSIS\nThe Australian Dollar appeared to gain bearish momentum when broke the lower bound of an ascending trend channel last week.\nIt appears to have support for now near a prior low at 0.6688 when it traded as low as 0.6698. Support could be further down at the previous lows of 0.6629 and 0.6585.\nThe move lower saw the price close below the lower band of the 21-day Simple Moving Average (SMA) based Bollinger Band. Yesterday\u2019s close was back inside the band and this might indicate a pause in the bearish move or a potential reversal.\nOn the topside, resistance could be at the breakpoints of 0.6856 and 0.6916 ahead of the prior peaks of 0.7011 and 0.7030.\nAUD\/USD DAILY CHART\n\nChart created in TradingView\n\u2014 Written by Daniel McCarthy, Strategist for DailyFX.com\nTo contact Daniel, use the comments section below or @DanMcCathyFX on Twitter\n element inside the  element. This is probably not what you meant to do!\nLoad your application\u2019s JavaScript bundle inside the  element instead. ","title":"Australian Dollar Pauses After Trend Break. Where to for AUD\/USD?","img_url":"https:\/\/psxon.com\/wp-content\/uploads\/2023\/02\/1677559428_image1.png"}]