Lukman Otunuga
ForexTime (FXTM)
The Greenback glided higher on Wednesday as investors prepared for Donald Trump's anticipated formal news conference. With today's press conference the first official one since the market shaking presidential victory in November, financial markets could turn volatile. Uncertainty still remains a key issue when dealing with Trump while concerns linger over the President-Elect saying something which could negatively impact the Dollar.
A multitude of events have taken place since Trump's victory and such may translate to an influx of questions from the reporters, something investors will pay close attention towards. Markets are also expecting Trump to reiterate his economic policies for fiscal spending and how he plans to make America great again. With Trump repeatedly sharing his views on trade and China on social media, attention may be directed towards his thoughts on global trade and relations with China in the formal conference.
Emerging markets await Trump
Emerging markets could come under renewed pressure if U.S President-Elect Donald Trump reiterates his protectionist trade views during this evening's news conference. The Mexican peso has already tumbled to historical lows amid fears of Trump discarding a key trade agreement with Mexico while the Chinese Yuan is on the defence. The growing threat of Trump maintaining a harsh stance on China trade and scrapping the Trans Pacific Partnership (TPP) could expose Asian currencies to further downside risks.
Market participants may observe if Trump provides additional clarity on how his proposed fiscal stimulus will boost US economic growth. The Greenbacks aggressive appreciation has punished emerging market currencies considerably with speculations of higher US rates sparking capital outflows. A situation where President-Elect Donald Trump repeats his plan to boost US growth via tax cuts and infrastructure spending could elevate the Dollar consequently pressuring EM currencies further.
Currency spotlight – USDJPY
A strengthening Dollar has been the engine behind the USDJPY incredible gains on the daily charts. This pair is heavily bullish as there have been consistently higher highs and higher lows. Bullish investors may exploit a breakout above 116.500 to send the USDJPY towards 117.500 and potentially higher. Bulls remain in firm control as long as prices can keep above the 114.50 higher low.
Disclaimer:This written/visual material is comprised of personal opinions and ideas. The content should not be construed as containing any type of investment advice and/or a solicitation for any transactions. It does not imply an obligation to purchase investment services, nor does it guarantee or predict future performance. FXTM, its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness of any information or data made available and assume no liability for any loss arising from any investment based on the same.
Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 90% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Recommended Content
Editors’ Picks
EUR/USD consolidates weekly gains above 1.1150
EUR/USD moves up and down in a narrow channel slightly above 1.1150 on Friday. In the absence of high-tier macroeconomic data releases, comments from central bank officials and the risk mood could drive the pair's action heading into the weekend.
GBP/USD stabilizes near 1.3300, looks to post strong weekly gains
GBP/USD trades modestly higher on the day near 1.3300, supported by the upbeat UK Retail Sales data for August. The pair remains on track to end the week, which featured Fed and BoE policy decisions, with strong gains.
Gold extends rally to new record-high above $2,610
Gold (XAU/USD) preserves its bullish momentum and trades at a new all-time high above $2,610 on Friday. Heightened expectations that global central banks will follow the Fed in easing policy and slashing rates lift XAU/USD.
Week ahead – SNB to cut again, RBA to stand pat, PCE inflation also on tap
SNB is expected to ease for third time; might cut by 50bps. RBA to hold rates but could turn less hawkish as CPI falls. After inaugural Fed cut, attention turns to PCE inflation.
Bank of Japan set to keep rates on hold after July’s hike shocked markets
The Bank of Japan is expected to keep its short-term interest rate target between 0.15% and 0.25% on Friday, following the conclusion of its two-day monetary policy review. The decision is set to be announced during the early Asian session.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.