EURUSD, H1
The Greenback has given up all its gains from the the initial reaction to the FED rate hike announcement. USA interest rates now sit at 1.75-2.00 per cent following the 0.25 basis point rise. In Switzerland they sit at The policy statement and outlook were also more hawkish than the market was expecting. So it looks like it’s four times for the FED in 2018.
The central bank see inflation up and over shooting, growth better than they thought, and unemployment to fall further with a tick up in earnings. A hawkish tone indeed. The Greenback immediately accrued (EURUSD touched 1.1726) but then give up all its gains as the details were digested. The key triggers for the dollar decline were that only one FED member had switched from expectations for one more to two more rate hikes this year. In March seven members were expecting two rate hikes and eight were expecting one more, yesterday the split was only eight for two and seven for one. This and the China trade tariff worries (tomorrow June 15 is the deadline for the tariffs to potentially come into force) pulled the Greenback, US Treasury Yields (which had gone back over over 3%) and Equities all down.
The Crossing EMA H1 strategy suggested strength from the 11:00 candle yesterday (1) and has closed north of the Bollinger Band mid line (20 period moving average) ever since. So a trend following strategy (which avoided the FED announcement) triggered twice yesterday and safe entries were also provided this morning as we remained north of the three key moving averages, (which also still remain nicely aligned). The RSI has also been trending up from 48.42 at 11:00 yesterday to 68.28 currently without ever getting into the over bought zone. The rally has currently stalled at the first major resistance, R1 (1.1818), the upper Bollinger band is 1.1825 and R2 is at 1.1847. The EUR awaits the ECB decision, statement and Mr Draghi’s press conference.
Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.
Recommended Content
Editors’ Picks
AUD/USD remained bid above 0.6500
AUD/USD extended further its bullish performance, advancing for the fourth session in a row on Thursday, although a sustainable breakout of the key 200-day SMA at 0.6526 still remain elusive.
EUR/USD faces a minor resistance near at 1.0750
EUR/USD quickly left behind Wednesday’s small downtick and resumed its uptrend north of 1.0700 the figure, always on the back of the persistent sell-off in the US Dollar ahead of key PCE data on Friday.
Gold holds around $2,330 after dismal US data
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
Bitcoin price continues to get rejected from $65K resistance as SEC delays decision on spot BTC ETF options
Bitcoin (BTC) price has markets in disarray, provoking a broader market crash as it slumped to the $62,000 range on Thursday. Meanwhile, reverberations from spot BTC exchange-traded funds (ETFs) continue to influence the market.
US economy: slower growth with stronger inflation
The dollar strengthened, and stocks fell after statistical data from the US. The focus was on the preliminary estimate of GDP for the first quarter. Annualised quarterly growth came in at just 1.6%, down from the 2.5% and 3.4% previously forecast.