Alpesh Patel
InvestingBetter.com
General market theme
Choppy price action over the past 24 hours in the major instruments we monitor in our daily report as we saw inconsistent momentum and a few changes in direction during yesterday’s session. The focus was on the UK and US inflation figures but it seems that investors are little interested about fundamental drivers at this time, especially when it comes to the Pound. As such the price action becomes a bit unpredictable as the markets start to trade without any real purpose.
Today market participants’ attention will remain focused as there’s more important data coming in with the UK employment market report, the Eurozone inflation figures and finally the release of the Fed minutes from their last meeting. Given the current pause in Dollar’s recent rally and the doubts over its outlook the release of the FOMC meetings might further clarify the central bank’s intentions.
Price action highlights
The Euro tried to move to the upside but this attempt failed and the currency corrected lower for no apparent reason given that the recent demand for Dollars has cooled off. The rate dropped from the 1.1350 highs to trade as low as 1.1280 at the time of typing this report however the bias remains mixed. Today’s inflation figures from the Euro area are expected to print in a steady manner and combined with a bearish FOMC minutes release it could allow the Euro to look to the upside once more with the 1.1350 highs being the area of interest.
The Cable pushed radically higher yesterday ahead of the inflation report as investors were hoping for a bullish release that would confirm the recent BoE comments on the rising prices’ growth. However the report missed its mark and a strong correction followed that took the Pound off the 1.4500 area and drove it lower. This morning we find the Pound trading around the 1.4430 level and its price action today will hinge on the way the employment data will print. The bias remains bearish but we’ve seen quite an inconsistent performance from the Cable recently thus caution is advised.
Focus of the day
Eurozone inflation and the UK employment figures are the two important reports this morning and we expect them to affect the price action in the Euro and the Cable as we detailed above. Later in the day though the attention will be on the release of the Fed minutes and caution is needed as this event holds a special significance for investors.
Economic Calendar
Past performance is not indicative of future results. Trading forex, CFDs and equites carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade any such leveraged products you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading on margin, and seek advice from an independent financial advisor if you have any doubts. The information provided by InvestingBetter.com should not be relied upon as a substitute for extensive independent research which should be performed before making your investment decisions. InvestingBetter.com are merely providing this information for your general information. The information and opinions presented do not take into account any particular individual’s investment objectives, financial situation, or needs. All investors should obtain advice based on their unique situation before making any investment decision and should tailor the trade size and leverage of their trading to their personal risk appetite. InvestingBetter.com and/or its owners will not be responsible for any losses incurred on investments made by readers and clients as a result of any information contained on InvestingBetter.com. InvestingBetter.com does not render investment, legal, accounting, tax, or other professional advice. If investment, legal, tax, or other expert assistance is required, the services of a competent professional should be sought.
Recommended Content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.