Markets seem to have stabilised for now but it may be temporary as investors adjust for an environment of lower inflation, lower growth and higher interest rates, although it’s still far from a done deal that interest rates will indeed rise anytime soon. The UK’s benchmark FTSE 100 is on course to record its longest running streak of weekly losses for over a year and on many indicators is signalling that it’s over sold so we could see a bounce especially since yesterday’s price action looks to have formed a long legged “doji” candlestick which is considered to be a buy signal. This does not mean the sell off is over of course and the 10% correction from the highs we’ve seen to date could be extended before better buying levels are presented.
For FX markets, GBPUSD recaptured the 1.6000 level hitting 1.6100 overnight following dovish comments from the Fed’s James Bullard which caused the dollar’s intraday strength to fizzle out, but is giving back those gains retreating to 1.6035 at the time of writing. For what is likely to be a quiet end to a very hectic week, with the absence of any major data releases, one currency to keep an eye on is CAD as Canadian inflation data is released later today. USDCAD has broken to new five year highs this week but its rally has stalled along with the wider dollar weakness so anything higher than the 2xpected 2.0% for CPI could see further profit taking in USDCAD. Also today we see the Fed’s Yellen speak at 13.30 UK time and this will be very closely watched to see if she echoes Bullard’s comments from yesterday.
FxPro UK Limited is authorised and regulated by the Financial Services Authority, registration number 509956. CFDs are leveraged products that incur a high level of risk and it is possible to lose all your capital invested. Please ensure that you understand the risks involved and seek independent advice if necessary.
Disclaimer: This material is considered a marketing communication and does not contain, and should not be construed as containing, investment advice or an investment recommendation or, an offer of or solicitation for any transactions in financial instruments. Past performance is not a guarantee of or prediction of future performance. FxPro does not take into account your personal investment objectives or financial situation. FxPro makes no representation and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied by any employee of FxPro, a third party or otherwise. This material has not been prepared in accordance with legal requirements promoting the independence of investment research and it is not subject to any prohibition on dealing ahead of the dissemination of investment research. All expressions of opinion are subject to change without notice. Any opinions made may be personal to the author and may not reflect the opinions of FxPro. This communication must not be reproduced or further distributed without the prior permission of FxPro. Risk Warning: CFDs, which are leveraged products, incur a high level of risk and can result in the loss of all your invested capital. Therefore, CFDs may not be suitable for all investors. You should not risk more than you are prepared to lose. Before deciding to trade, please ensure you understand the risks involved and take into account your level of experience. Seek independent advice if necessary. FxPro Financial Services Ltd is authorised and regulated by the CySEC (licence no. 078/07) and FxPro UK Limited is authorised and regulated by the Financial Services Authority, Number 509956.
Recommended Content
Editors’ Picks
EUR/USD stabilizes near 1.0800 as trading action turns subdued
EUR/USD holds steady near 1.0800 on Thursday and remains on track to end the day in negative territory following upbeat macroeconomic data releases from the US. The action in financial markets turn subdued as trading volumes thin out heading into Easter holiday.
GBP/USD extends sideways grind above 1.2600
GBP/USD fluctuates in a narrow channel above 1.2600 on Thursday. The better-than-expected Initial Jobless Claims data from the US and the upward revision to the Q4 GDP growth help the USD stay resilient against its rivals and limits the pair's upside.
Gold pulls away from daily highs, holds above $2,200
Gold retreats from daily highs but holds comfortably above $2,200 in the American session on Thursday. The benchmark 10-year US Treasury bond yield stays near 4.2% after upbeat US data and makes it difficult for XAU/USD to gather further bullish momentum.
XRP price falls to $0.60 support as Ripple ruling doesn’t help Coinbase lawsuit against SEC
XRP programmatic sales ruling by Judge Torres was completely rejected by another US Court that ruled in favor of the SEC in a lawsuit against Coinbase.
Portfolio rebalancing and reflation trades emerge into Q2
Yesterday’s price action pointed at a possible end-of-quarter portfolio rebalancing as the session saw the laggards of the quarter like Apple and Tesla gain, and the stars like Microsoft and Nvidia retreat.