Archive for Forex and Currency News – Page 21

13 Mar

US Dollar Strengthens Amid Inflation Data

By RoboForex Analytical Department

As of Wednesday, the EUR/USD pair is hovering near 1.0925 after experiencing a volatile session, with expectations for a more subdued week ahead.

Recent statistical data highlighted higher-than-expected inflation in the US for February, prompting adjustments to predictions about the easing of monetary policy by the Federal Reserve in June.

The Consumer Price Index (CPI) rose by 0.4% month-on-month last month, aligning with expectations. Year-on-year, the indicator expanded to 3.2% from 3.1%. Core inflation in the US increased by 0.4% month-on-month, surpassing the forecast of 0.3%. From year to year, the indicator rose to 3.8% from the previous 3.7%.

While these figures did not come as a “surprise,” they reaffirmed that inflation is more persistent than previously thought. Specific details of the reports offer local hope for improvement, although it is clear overall that the situation could be more comfortable for the Fed to make significant decisions.

The market interpreted these developments favourably for the US dollar, shifting investor preferences towards it.

Market focus is squarely on the Fed’s June meeting, with the March and May sessions attracting less interest. The Fed will likely require more statistical information by then.

As indicated by public data, investor expectations suggest a 69% chance of a rate cut in June, down from 71% earlier in the week.

In what would be the most optimistic forecast, the Fed will probably manage to cut rates only three times this year.

Technical Analysis of EUR/USD

On the H4 chart, EUR/USD is forming the first wave of decline towards 1.0777. The first structure of this wave and its correction have been completed. Today, we will consider the likelihood of breaking the minimum of the first structure and continuing the development of the wave to the local target level of 1.0815. The MACD indicator confirms this scenario, with its signal line above zero and a sharply decreasing histogram, indicating the continuation of the downtrend.

On the H1 chart, EUR/USD has formed the first wave of a decline structure to 1.0900 and a correction to 1.0939. The market has essentially delineated a consolidation range around the level of 1.0939. Today, a decline to the lower boundary of this range is expected. With a breach of 1.0900, a further decline to 1.0880 is anticipated, with the trend potentially continuing to 1.0815. The Stochastic oscillator confirms this scenario, with its signal line below the 50 mark, expecting a continuation of the decline towards 20.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Financial News Forex and Currency News
11 Mar

Japanese Yen Surges to Monthly High as Economy Shows Signs of Growth

By RoboForex Analytical Department

The Japanese yen strengthened against the US dollar on Monday, reaching a month-long peak following the release of statistics indicating Japan’s return to economic growth in Q4 2023. This development effectively ends the previously declared technical recession.

Japan’s GDP experienced a quarterly increase of 0.1% and an annual growth of 0.4%. These figures revise earlier estimates, suggesting 0.1% and 0.4% declines, respectively. In comparison, the Japanese economy contracted by 0.8% quarterly and 3.3% annually in Q3 2023.

The positive economic data have fuelled market speculation about a potential interest rate hike by the Bank of Japan, with some economists and traders anticipating such a move as soon as March.

Bank of Japan board member Junko Nakagawa recently commented on the visible prospects for achieving inflation targets and a positive wage cycle, further supporting the yen.

The Japanese currency is currently benefitting from the weakening US dollar and a drop in US government bond yields amid the Federal Reserve’s dovish rhetoric.

Technical Analysis of USD/JPY

On the H4 USD/JPY chart, a correction wave to the 146.48 level has been completed (tested from above). The market is now forming a consolidation range above this level, expecting to break upwards and initiate the fifth growth wave towards 152.72. The MACD oscillator supports this scenario, with its signal line trading below zero at minimums and poised for growth.

On the H1 USD/JPY chart, a correction wave to 146.48 has finished. A growth impulse to 147.26 and its correction to 146.55 have been executed, essentially setting the consolidation range boundaries. With an upward breakout, growth towards the 148.00 level is anticipated. This target is the first in the growth wave. The Stochastic oscillator confirms this scenario, with its signal line above the 50 mark and strictly heading towards 80.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Financial News Forex and Currency News
11 Mar

Trade of the Week: Yen bulls to clap back?

By ForexTime 

  • JPY is G10’s best-performer today, also month-to-date
  • Yen climbing on creeping bets for imminent Bank of Japan hike
  • Tuesday’s US inflation release will feed market’s main obsession
  • Friday’s Japan wage negotiations results are key for BoJ
  • Bloomberg forecast: USDJPY to trade between 144.48 – 148.65 this week

The Japanese Yen is already off to a strong start this week!

Not only is it the best-performing G10 currency against the US dollar today, but also for the month:

  • So far today (Monday, March 11th): USDJPY is down 0.24% at the time of writing
  • So far this month: USDJPY has fallen by 2.2%
NOTE: USDJPY goes down when the Japanese Yen strengthens against the US dollar.

 

Why is the Yen climbing?

Markets are starting to restore hopes, once again, that the Bank of Japan (BoJ) is now (finally? truly?) ready to trigger a rate hike.

Markets had previously made similar predictions in recent years past, only to be left sorely disappointed when the BoJ left its rates unchanged, even as other major central banks raised their own rates aggressively in recent years.

Keep in mind that the BoJ is the last central bank to still adopt a negative interest rate regime, keeping its rates at -0.1%.

At present, markets are forecasting the following:

  • 65.7% chance of a BoJ rate hike at its March 19th policy decision
  • 86.4% chance of a BoJ rate hike by its April 26th policy decision
NOTE: A currency tends to strengthen when its central bank is perceived to be raising its benchmark rates.

 

However, JPY bulls (those hoping the Yen will strengthen) have a lot more ground to cover before their pride can be fully restored.

After all, the Yen has endured a torrid time in recent years.

JPY has been the weakest G10 currency against the US dollar in 2 out of the past 3 years.

 

Events Watchlist

This week, two key events could determine whether Yen bulls can get some much-needed ammo to stand up to their critics:

1) Tuesday, March 12th: US February inflation data

Here are the economists’ forecasts for the February consumer price index (CPI), which is used to measure headline inflation growth:

  • Headline CPI year-on-year (February 2024 vs. February 2023): 3.1%
    If so, this would match January’s 3.1% year-on-year number
  • Headline CPI month-on-month (February 2024 vs. January 2024): 0.4%
    If so, this would be higher than January’s 0.3% month-on-month number
  • Core CPI (excluding food and energy prices, which are more volatile) year-on-year: 3.7%
    If so, this would be lower than January’s 3.9% month-on-month number
  • Core CPI month-on-month: 0.3%
    If so, this would be lower than January’s 0.4% month-on-month number

Why does this matter?

The Federal Reserve (US central bank) has a mandate to subdue red-hot inflation since the pandemic, which it has done so by aggressively hiking US interest rates in recent years.

Markets want to know how soon could this battle against inflation be over, and when the Fed can begin to return US rates to lower, and more “normal” levels.

This guessing game has been the market’s primary obsession in recent years.

This sets up every monthly CPI data release as arguably the most important piece of economic data for investors and traders worldwide.
Potential Scenarios:

  • Overall, if the US inflation data come in below market expectations, that should pave the way for the Fed to lower its benchmark rates in the months ahead.

    Such expectations should weaken the US dollar, while dragging USDJPY lower.

  • However, if the US inflation data exceed market expectations, that may further delay a Fed rate cut.

    Such expectations should support the US dollar, while potentially prompting USDJPY to unwind some of its recent losses.

 

 

2) Friday, March 15th: Japan wage negotiations results

Japan’s largest union group, Rengo, is set to announce the results from its annual wage negotiations.

On average, workers unions are demanding for a pay hike of 5.85% this year – its largest raise since 1993.

For comparison, a year ago, these unions demanded for an increase of 4.49%.
Why does this matter?

Higher salaries would imply stronger spending power among Japanese consumers, which could support inflationary pressures (business can raise prices sustainably).

The Bank of Japan wants to see sustained inflation, despite the headline CPI having exceeded its 2% target since April 2022.

A massive pay hike for Japanese workers could help underpin the country’s inflation outlook while likely paving the way for the long-awaited BoJ rate hike.

Potential Scenarios:

  • If Rengo announces that it secured a higher-than-expected pay raise, that could deliver a massive boost to the Yen.
  • However, if Rengo disappoints Yen bulls and the BoJ with its wage negotiation results, that may pull JPY back lower, while sending USDJPY back closer to recent heights.

 

 

Key levels

According to Bloomberg’s FX forecast model, USDJPY is expected to trade within the 144.48 – 148.65 range this week.

Potential resistance:

  • 147.20 region: key battleground between bulls and bears since August 2023
  • 100-day SMA
  • 148.00 – 148.65: price region which includes psychologically-important level and the upper bound of Bloomberg’s forecasted range

 

Potential support:

  • 200-day SMA
  • 145.00: psychologically-important level
  • 144.48: notable battleground between bulls and bears since 2022 / lower bound of Bloomberg’s forecast model

 

Watch for technical rebound

Note that USDJPY’s 14-day relative strength index (RSI) is already flirting with the 30 level.

When the 14-day RSI hits or goes below 30, that meets the textbook criteria for “oversold” conditions.

Recall how USDJPY experienced such a technical rebound was seen when the RSI last hit 30 back in December 2023.

Hence, further declines this week may once again trigger another short-lived technical rebound for USDJPY.

 

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Forex and Currency News Opinions
08 Mar

Week Ahead: USDInd primed for data heavy week

By ForexTime 

  • Data packed week could rock USD
  • Watch out for US CPI report
  • USDInd bearish on D1 but RSI oversold
  • Key level of interest at 102.80

Even as markets brace for potential volatility ahead of the US jobs report this afternoon (Friday 8th March), investors are mindful of the string of key data releases in the week ahead.

Top-tier economic reports from across the globe and political developments in the United States will be in focus. However, watch out for the US CPI report which could be the main market mover:

Saturday, 9th March

  • CNH: China aggregate financing, PPI, CPI, new yuan loans

Sunday, 10th March

  • Daylight Savings Time in the US begins
  • Ramadan holiday starts at sundown for Muslims worldwide

Monday, 11th March  

  • JPY: Japan GDP
  • US budget proposal from President Joe Biden

Tuesday, 12th March

  • AUD: Australia business confidence
  • EUR: Germany CPI
  • JPY: Japan PPI
  • GBP: UK jobless claims, unemployment
  • USD: US February CPI report

Wednesday, 13th March

  • EUR: Eurozone industrial production
  • NZD: New Zealand food prices
  • GBP: UK industrial production
  • GER40: Volkswagen, Adidas earnings

Thursday, 14th March

  • USD: US PPI, retail sales, initial jobless claims

Friday, 15th March

  • NZD: New Zealand PMI
  • USD: US industrial production, University of Michigan consumer sentiment

The scheduled data releases could present fresh trading opportunities across financial markets.

But our attention falls on the USDInd which tumbled this week following dovish comments by Fed Chair Jerome Powell.

The USD Index tracks how the dollar is performing against a basket of six different G10 currencies, including the Euro, British Pound, Japanese Yen, and Canadian dollar.

The USDInd could be set for more action and here are 3 reasons why:

  1. US February CPI report

The February US Consumer Price Index (CPI) report published on Tuesday may influence bets around when the Fed will start cutting rates.

Markets are forecasting: 

  • CPI year-on-year (February 2024 vs. February 2023) to remain unchanged at 3.1%.
  • Core CPI year-on-year to cool 3.7% from 3.9% in the prior month.
  • CPI month-on-month (February 2024 vs January 2024) to rise 0.4% from 0.3%.
  • Core CPI month-on-month to cool 0.3% from 0.4% in the prior month.

Although headline inflation is expected to remain unchanged at 3.1%, the annual core is expected to have cooled to 3.7% – its lowest level since April 2021. Ultimately, further evidence of disinflation may fuel expectations around the Fed cutting interest rates.

  • A softer-than-expected US CPI report may send the USDInd lower.
  • Should inflation remain sticky, the USDInd has the potential to push higher.

 

  1. Key US data

Looking beyond the US CPI report, it would be wise to keep a close eye on other important data points including PPI, retail sales and industrial production among other  releases. These reports may provide fresh insight into the health of the US economy and additional clues on the Fed’s next move.

Traders are currently pricing in a 28% probability of a 25 basis point cut in May with this jumping to 96% by June 2024.

Note: These odds are likely to not only be influenced by the US jobs report, but incoming US inflation data along with other key releases next week.

  • Should overall US economic data support the case for lower US interest rates, this may drag the USDInd lower.
  • However, if overall data exceeds forecasts and supports the argument around US rates remaining higher for longer, this could boost the USDInd.

 

  1. Technical forces

The USDInd is under pressure on the daily charts with prices trading below the 50, 100 and 200-day SMA. Although bears seem to be gaining momentum, the Relative Strength Index (RSI) signals that prices are heavily oversold.

  • A solid daily close below the 102.80 level may trigger a decline towards 102.00 and 101.35.  
  • Should prices push back above the 50-day SMA, this may encourage a move towards the 200-day SMA at 103.75 and 104.30.

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Financial News Forex and Currency News
05 Mar

EUR/USD Shows Strength Amid Anticipation of Key Events

By RoboForex Analytical Department

The EUR/USD pair is exhibiting resilience, navigating around the 1.0850 mark on Tuesday, following a sequence of rises in the previous two sessions. The current market atmosphere is one of cautious optimism, as participants brace for significant upcoming events, including a speech by Jerome Powell, the head of the US Federal Reserve, and the release of February’s employment sector statistics on Friday. Particularly, the focus will be on the wage growth components for February, which are speculated to have nearly tripled, potentially indicating a diminishing impact of pro-inflationary factors.

The consensus among market observers is leaning towards an expectation that the Federal Reserve may initiate the first interest rate cut of this monetary cycle in June, with possibilities of further reductions occurring up to three times by year-end.

EUR/USD Technical Analysis

On the H4 chart, the EUR/USD pair is currently carving out a consolidation pattern around the 1.0831 level, with a recent extension up to 1.0866. A downward correction to 1.0831, testing the level from above, could materialize today. An upward break from this consolidation could herald the start of a growth wave towards 1.0900, at which point the current growth phase is anticipated to conclude, potentially giving way to a new downtrend with an initial target at 1.0680. This outlook is supported by the MACD indicator, which shows the signal line above zero and a sharply rising histogram, indicating a continuation of the growth trend.

The H1 chart reveals a consolidation phase around the 1.0831 level, with a growth structure targeting 1.0870 currently unfolding. The local target of 1.0866 for this wave has been achieved, with a correction back to 1.0831 anticipated. Following this correction, the focus will shift towards the structure’s growth potential to 1.0870. The Stochastic oscillator, currently below the 50 mark and expected to drop to 20, validates this scenario, suggesting a potential for further fluctuations within this bullish trend.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Financial News Forex and Currency News
05 Mar

Trade Of The Week: EURCAD knocks on major resistance

By ForexTime

  • BoC/ECB combo could rattle EURCAD
  • Both central banks expected to hold rates
  • Keep eye on updated ECB economic projections
  • EURCAD bullish on D1 but RSI overbought
  • Key levels of interest at 1.4650 & 1.4750

A central bank combo featuring the Bank of Canada (BoC) and European Central Bank (ECB) may rock the EURCAD this week.

The minor currency pair has been trapped within a wide range since December 2023, with support at 1.4475 and resistance at 1.4750.

However, a bullish presence can be felt on the daily charts with prices approaching key resistance.

The EURCAD could be on the cusp of a major breakout.

Here are 3 reasons why:

  1. BoC rate decision

The Bank of Canada is expected to leave interest rates unchanged at 5% on Wednesday.

Given how economic growth surprised to the upside in Q4 and inflation fell to its lowest since June 2023 at 2.9%, the BoC may not be in a rush to cut interest rates. Nevertheless, much attention will be directed towards the policy statement for more clues on the central bank’s next policy move. Interestingly, traders are pricing in only a 32% probability of a 25-basis point BoC cut by April with this jumping to 86% by June 2024.

  • If the BoC signals that rates will remain higher for longer until there are more signs of cooling inflation, this may boost the Canadian Dollar.
  • Should the BoC strike a dovish note and hint that a rate cut could be around the corner, the CAD may weaken – pushing the USDCAD higher as a result.

 

  1. ECB rate decision

Markets widely expect the European Central Bank to leave interest rates unchanged on Thursday.

So much focus will be on the fresh forecasts from the ECB’s staff economists and Lagarde’s press conference for fresh clues on future policy moves. It is worth noting that inflation has edged lower in the euro area while economic data remains soft. Traders are currently pricing in a 21% probability of a 25-basis point ECB cut by April with this rising to 92% by June 2024.

  • Should the ECB sound more hawkish than expected and signals the rates will remain higher for longer, the euro may jump – pushing the EURCAD higher.
  • A dovish sounding ECB that confirms potential rate cuts later this year is likely to weaken the euro, dragging the EURCAD lower.

 

  1. Technical forces

The EURCAD is respecting a bullish channel on the daily charts with prices trading above the 50, 100 and 200-day SMA. However, the Relative Strength Index (RSI) signals that prices are approaching overbought levels.

  • A solid breakout above 1.4750 may spark a move higher towards 1.4850.
  • Should prices slip below the 100-day SMA at 1.4650, this may open a path towards the 50-day and 200-day SMA at 1.4590.

According to Bloomberg’s FX forecast model, there’s a 77% chance that EURCAD will trade within the 1.45895 – 1.48550 range over the next week.

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Forex and Currency News Opinions
03 Mar

Japanese Yen Speculators sharply renew bearish bets for 7th straight week

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday February 27th and shows a quick view of how large market participants (for-profit speculators and commercial traders) were positioned in the futures markets. All currency positions are in direct relation to the US dollar where, for example, a bet for the euro is a bet that the euro will rise versus the dollar while a bet against the euro will be a bet that the euro will decline versus the dollar.

Weekly Speculator Changes led by New Zealand Dollar & Australian Dollar

The COT currency market speculator bets were higher this week as six out of the eleven currency markets we cover had higher positioning while the other five markets had lower speculator contracts.

Leading the gains for the currency markets was the New Zealand Dollar (3,431 contracts) with the Australian Dollar (2,699 contracts), the Brazilian Real (1,004 contracts), the US Dollar Index (537 contracts), Bitcoin (131 contracts) and the British Pound (46 contracts) also having positive weeks.

The currencies seeing declines in speculator bets on the week were the Japanese Yen (-11,927 contracts), the EuroFX (-5,162 contracts), the Mexican Peso (-2,181 contracts), the Swiss Franc (-2,058 contracts) and the Canadian Dollar (-515 contracts) also registering lower bets on the week.

Japanese Yen Speculators sharply renew their bearish bets for 7th straight week

Highlighting the COT currency’s data this week is strong renewal in bearish bets for the Japanese yen speculators. Large speculative yen positions dropped for a seventh straight week this week and have now fallen by a total of -76,756 contracts over these past seven weeks.

This renewed bearishness for the yen has pushed the net position (currently at -132,705 contracts) to the most negative position since November 14th of 2017 (when it fell to -135,999 contracts), the lowest level in a span of 328 weeks.

Just a couple of months ago, the yen speculative positioning had been improving and was at it’s best level in 39-weeks (at -55,568 contracts on December 26th). This optimism was based on the hopes that the Bank of Japan (BOJ) would look to end its negative interest rate policy and its asset-buying program. However, the BOJ has maintained its policy so far in 2024 and speculator hopes for yen strength have been postponed.

The yen exchange rate has taken a large hit in the aftermath with the US Dollar’s exchange versus the yen shooting higher and closing in on the recent 2023 highs. The USDJPY currency pair is up by almost 7 percent since the beginning of the year and has risen in seven out of the past nine weeks. This week’s close was right above the 150.00 level is slightly below the November 2023 high of 151.90.

The USDJPY prices above the 150.00 level are very rare in recent years as these levels had not been reached since 1990 — until this threshold was breached in 2022, 2023 and now in 2024. The yen has now lost approximately 45 percent of its value versus the US Dollar since January of 2021 when the USDJPY traded around 103.00.

Currencies Net Speculators Leaderboard

Legend: Weekly Speculators Change | Speculators Current Net Position | Speculators Strength Score compared to last 3-Years (0-100 range)

Strength Scores led by Mexican Peso & British Pound

COT Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is Extreme-Bullish and below 20 is Extreme-Bearish) showed that the Mexican Peso (96 percent), the British Pound (88 percent) and New Zealand Dollar (82 percent) lead the currency markets this week. The Canadian Dollar (58 percent) and the Brazilian Real (57 percent) come in as the next highest in the weekly strength scores.

On the downside, the Japanese Yen (0 percent) and the Australian Dollar (16 percent) come in at the lowest strength levels currently and are in Extreme-Bearish territory (below 20 percent). The next lowest strength scores are the US Dollar Index (20 percent) and the Swiss Franc (25 percent).

Strength Statistics:
US Dollar Index (20.4 percent) vs US Dollar Index previous week (19.4 percent)
EuroFX (47.1 percent) vs EuroFX previous week (49.3 percent)
British Pound Sterling (87.9 percent) vs British Pound Sterling previous week (87.9 percent)
Japanese Yen (0.0 percent) vs Japanese Yen previous week (8.6 percent)
Swiss Franc (24.7 percent) vs Swiss Franc previous week (30.6 percent)
Canadian Dollar (57.9 percent) vs Canadian Dollar previous week (58.4 percent)
Australian Dollar (16.3 percent) vs Australian Dollar previous week (13.8 percent)
New Zealand Dollar (81.6 percent) vs New Zealand Dollar previous week (72.7 percent)
Mexican Peso (96.0 percent) vs Mexican Peso previous week (97.3 percent)
Brazilian Real (57.2 percent) vs Brazilian Real previous week (55.9 percent)
Bitcoin (36.8 percent) vs Bitcoin previous week (34.8 percent)

New Zealand Dollar & British Pound top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that the New Zealand Dollar (34 percent) and the British Pound (11 percent) lead the past six weeks trends for the currencies. The Canadian Dollar (10 percent) and the Mexican Peso (7 percent) are the next highest positive movers in the latest trends data.

The Japanese Yen (-55 percent) leads the downside trend scores currently with the Australian Dollar (-29 percent), Swiss Franc (-24 percent) and the EuroFX (-18 percent) following next with lower trend scores.

Strength Trend Statistics:
US Dollar Index (1.5 percent) vs US Dollar Index previous week (-2.5 percent)
EuroFX (-17.6 percent) vs EuroFX previous week (-21.7 percent)
British Pound Sterling (10.7 percent) vs British Pound Sterling previous week (17.8 percent)
Japanese Yen (-54.7 percent) vs Japanese Yen previous week (-46.6 percent)
Swiss Franc (-23.5 percent) vs Swiss Franc previous week (-15.8 percent)
Canadian Dollar (10.1 percent) vs Canadian Dollar previous week (5.5 percent)
Australian Dollar (-28.7 percent) vs Australian Dollar previous week (-45.4 percent)
New Zealand Dollar (33.7 percent) vs New Zealand Dollar previous week (21.9 percent)
Mexican Peso (7.4 percent) vs Mexican Peso previous week (4.6 percent)
Brazilian Real (-9.3 percent) vs Brazilian Real previous week (-11.1 percent)
Bitcoin (-14.6 percent) vs Bitcoin previous week (-7.2 percent)

Individual COT Forex Markets:

US Dollar Index Futures:

US Dollar Index Forex Futures COT ChartThe US Dollar Index large speculator standing this week reached a net position of 2,083 contracts in the data reported through Tuesday. This was a weekly boost of 537 contracts from the previous week which had a total of 1,546 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 20.4 percent. The commercials are Bullish-Extreme with a score of 81.6 percent and the small traders (not shown in chart) are Bearish with a score of 25.6 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

US DOLLAR INDEX StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:63.718.911.5
– Percent of Open Interest Shorts:56.730.27.3
– Net Position:2,083-3,3231,240
– Gross Longs:18,8275,5993,387
– Gross Shorts:16,7448,9222,147
– Long to Short Ratio:1.1 to 10.6 to 11.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):20.481.625.6
– Strength Index Reading (3 Year Range):BearishBullish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:1.5-3.714.5

 

Euro Currency Futures:

Euro Currency Futures COT ChartThe Euro Currency large speculator standing this week reached a net position of 62,854 contracts in the data reported through Tuesday. This was a weekly decrease of -5,162 contracts from the previous week which had a total of 68,016 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 47.1 percent. The commercials are Bullish with a score of 55.6 percent and the small traders (not shown in chart) are Bearish with a score of 22.1 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

EURO Currency StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:28.757.511.2
– Percent of Open Interest Shorts:19.970.07.4
– Net Position:62,854-89,90127,047
– Gross Longs:205,234411,11780,334
– Gross Shorts:142,380501,01853,287
– Long to Short Ratio:1.4 to 10.8 to 11.5 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):47.155.622.1
– Strength Index Reading (3 Year Range):BearishBullishBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-17.617.4-8.6

 

British Pound Sterling Futures:

British Pound Sterling Futures COT ChartThe British Pound Sterling large speculator standing this week reached a net position of 46,358 contracts in the data reported through Tuesday. This was a weekly lift of 46 contracts from the previous week which had a total of 46,312 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 87.9 percent. The commercials are Bearish-Extreme with a score of 16.8 percent and the small traders (not shown in chart) are Bullish with a score of 68.3 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

BRITISH POUND StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:43.635.914.7
– Percent of Open Interest Shorts:21.660.412.2
– Net Position:46,358-51,5905,232
– Gross Longs:91,97075,76231,048
– Gross Shorts:45,612127,35225,816
– Long to Short Ratio:2.0 to 10.6 to 11.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):87.916.868.3
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:10.7-11.510.2

 

Japanese Yen Futures:

Japanese Yen Forex Futures COT ChartThe Japanese Yen large speculator standing this week reached a net position of -132,705 contracts in the data reported through Tuesday. This was a weekly decrease of -11,927 contracts from the previous week which had a total of -120,778 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 0.0 percent. The commercials are Bullish-Extreme with a score of 98.9 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 84.9 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

JAPANESE YEN StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:16.666.014.0
– Percent of Open Interest Shorts:59.423.413.7
– Net Position:-132,705131,982723
– Gross Longs:51,261204,42543,296
– Gross Shorts:183,96672,44342,573
– Long to Short Ratio:0.3 to 12.8 to 11.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):0.098.984.9
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-54.757.418.5

 

Swiss Franc Futures:

Swiss Franc Forex Futures COT ChartThe Swiss Franc large speculator standing this week reached a net position of -11,981 contracts in the data reported through Tuesday. This was a weekly fall of -2,058 contracts from the previous week which had a total of -9,923 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 24.7 percent. The commercials are Bullish with a score of 76.9 percent and the small traders (not shown in chart) are Bearish with a score of 23.9 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

SWISS FRANC StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:24.362.412.7
– Percent of Open Interest Shorts:42.726.130.6
– Net Position:-11,98123,709-11,728
– Gross Longs:15,85740,7168,251
– Gross Shorts:27,83817,00719,979
– Long to Short Ratio:0.6 to 12.4 to 10.4 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):24.776.923.9
– Strength Index Reading (3 Year Range):BearishBullishBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-23.556.1-69.1

 

Canadian Dollar Futures:

Canadian Dollar Forex Futures COT ChartThe Canadian Dollar large speculator standing this week reached a net position of -1,378 contracts in the data reported through Tuesday. This was a weekly fall of -515 contracts from the previous week which had a total of -863 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 57.9 percent. The commercials are Bullish with a score of 51.1 percent and the small traders (not shown in chart) are Bearish with a score of 27.1 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

CANADIAN DOLLAR StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:24.754.417.9
– Percent of Open Interest Shorts:25.554.716.7
– Net Position:-1,378-5731,951
– Gross Longs:41,15890,54629,731
– Gross Shorts:42,53691,11927,780
– Long to Short Ratio:1.0 to 11.0 to 11.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):57.951.127.1
– Strength Index Reading (3 Year Range):BullishBullishBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:10.1-3.4-14.5

 

Australian Dollar Futures:

Australian Dollar Forex Futures COT ChartThe Australian Dollar large speculator standing this week reached a net position of -79,176 contracts in the data reported through Tuesday. This was a weekly advance of 2,699 contracts from the previous week which had a total of -81,875 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 16.3 percent. The commercials are Bullish-Extreme with a score of 84.5 percent and the small traders (not shown in chart) are Bearish with a score of 27.5 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

AUSTRALIAN DOLLAR StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:24.263.19.5
– Percent of Open Interest Shorts:62.819.314.6
– Net Position:-79,17689,777-10,601
– Gross Longs:49,640129,29219,390
– Gross Shorts:128,81639,51529,991
– Long to Short Ratio:0.4 to 13.3 to 10.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):16.384.527.5
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-28.738.8-49.0

 

New Zealand Dollar Futures:

New Zealand Dollar Forex Futures COT ChartThe New Zealand Dollar large speculator standing this week reached a net position of 10,057 contracts in the data reported through Tuesday. This was a weekly gain of 3,431 contracts from the previous week which had a total of 6,626 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 81.6 percent. The commercials are Bearish-Extreme with a score of 16.4 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 84.7 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

NEW ZEALAND DOLLAR StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:49.436.110.4
– Percent of Open Interest Shorts:28.761.75.5
– Net Position:10,057-12,4252,368
– Gross Longs:23,94217,4745,020
– Gross Shorts:13,88529,8992,652
– Long to Short Ratio:1.7 to 10.6 to 11.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):81.616.484.7
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:33.7-28.3-6.6

 

Mexican Peso Futures:

Mexican Peso Futures COT ChartThe Mexican Peso large speculator standing this week reached a net position of 93,814 contracts in the data reported through Tuesday. This was a weekly reduction of -2,181 contracts from the previous week which had a total of 95,995 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 96.0 percent. The commercials are Bearish-Extreme with a score of 3.6 percent and the small traders (not shown in chart) are Bearish with a score of 43.6 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

MEXICAN PESO StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:57.138.93.1
– Percent of Open Interest Shorts:20.477.61.1
– Net Position:93,814-98,8955,081
– Gross Longs:146,11899,7277,980
– Gross Shorts:52,304198,6222,899
– Long to Short Ratio:2.8 to 10.5 to 12.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):96.03.643.6
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:7.4-7.42.6

 

Brazilian Real Futures:

Brazil Real Futures COT ChartThe Brazilian Real large speculator standing this week reached a net position of 17,526 contracts in the data reported through Tuesday. This was a weekly gain of 1,004 contracts from the previous week which had a total of 16,522 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 57.2 percent. The commercials are Bearish with a score of 41.5 percent and the small traders (not shown in chart) are Bullish with a score of 53.7 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

BRAZIL REAL StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:47.443.44.6
– Percent of Open Interest Shorts:23.370.31.7
– Net Position:17,526-19,5922,066
– Gross Longs:34,55031,6533,337
– Gross Shorts:17,02451,2451,271
– Long to Short Ratio:2.0 to 10.6 to 12.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):57.241.553.7
– Strength Index Reading (3 Year Range):BullishBearishBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-9.39.3-2.0

 

Bitcoin Futures:

Bitcoin Crypto Futures COT ChartThe Bitcoin large speculator standing this week reached a net position of -1,967 contracts in the data reported through Tuesday. This was a weekly gain of 131 contracts from the previous week which had a total of -2,098 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 36.8 percent. The commercials are Bullish-Extreme with a score of 89.1 percent and the small traders (not shown in chart) are Bearish with a score of 35.8 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

BITCOIN StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:79.47.06.8
– Percent of Open Interest Shorts:87.23.22.8
– Net Position:-1,9679601,007
– Gross Longs:20,0341,7591,726
– Gross Shorts:22,001799719
– Long to Short Ratio:0.9 to 12.2 to 12.4 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):36.889.135.8
– Strength Index Reading (3 Year Range):BearishBullish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-14.625.1-0.3

 

Article By InvestMacro – Receive our weekly COT Newsletter

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting). See CFTC criteria here.

COT Updates Forex and Currency News Opinions
29 Feb

Target Thursdays: USDJPY, EURNZD & Silver reach targets!

By ForexTime 

Check out these potential profits that you may have missed from our Daily Market Analysis.

  • USDJPY bears bag over 100 pips
  • EURNZD rallies almost 400 pips
  • Silver down 2.5% this week

 

    1) USDJPY bears strike key support level   

  • Where and when was Target Price (TP) published?

As discussed in our Week Ahead article on Friday, February 23rd:

“Should bulls get cold feet below 150.90, this may trigger a selloff towards 149.70 and potentially lower.”

 

  • What happened since TP was published?

The USDJPY was trapped within a range with bulls lacking the confidence to breach 150.90.

Hawkish remarks by a BoJ official on Thursday morning boosted the Japanese Yen, triggering a selloff as a result.

 

  • How much in potential profits?

Traders who shorted the USDJPY last Friday from the intraday high would have gained 107 pips!

The negative momentum briefly took prices below the 149.70 support with more volatility expected ahead of the US PCE report this afternoon.

 

    2) EURNZD charges through all bullish targets

  • Where and when was Target Price (TP) published?

As written in our Trade of The Week article on Monday, February 26th:

“A strong breakout above the 50-day SMA at 1.7600 may encourage an incline towards 1.7700 and the 100-day SMA at 1.7760”.

 

  • What happened since TP was published?

After kicking off the week on a positive note, the EURNZD exploded higher on Wednesday following the Reserve Bank of New Zealand (RBNZ) dovish pivot.

The currency pair charged through the 50- and 100-day SMA with the momentum taking prices to the 200-day SMA which was 400 pips away from the key 1. 7240 support!

 

  • How much in potential profits?

Traders who took advantage of the breakout above 1.7600 would have been rewarded 160 pips.

 

    3) Silver widens gap as negative momentum builds

  • Where and when was Target Price (TP) published?

In our technical article covering Silver on Tuesday, February 27th we discussed the near-term outlook for the precious metal.

“XAGUSD bears may look for a close below the 100 Fibonacci level at $22.614 with a retest and breach of $22.565 as a possible sign of a decline to lows below $22.437“

 

  • What happened since TP was published?

Silver prices were pressured by a stabilizing dollar and overall bearish price action with the metal shedding roughly 2.5% since the start of the week.

 

  • How much in potential profits?

177 points for traders who shorted silver at $22.614 and exited at $22.437.

At the time of writing silver remains under pressure and could be exposed to further volatility ahead of the incoming US PCE report.

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Financial News Forex and Currency News
27 Feb

EUR/USD Shows Resilience Amid Risk Appetite

By RoboForex Analytical Department

The EUR/USD pair is trading close to 1.0821, demonstrating a strong stance in the current market environment. Investors are leaning towards riskier assets, buoyed by the anticipation of several key macroeconomic releases this week.

A critical focal point for the market will be the upcoming US inflation data, particularly the core Personal Consumption Expenditures (PCE) price index, a preferred measure of inflation by the Federal Reserve. The report, expected to be released on Thursday, is forecasted to show a 0.4% month-on-month increase. This data is crucial as it influences the Fed’s monetary policy decisions.

The prevailing market sentiment suggests that the Federal Reserve may not be poised to embark on a monetary easing cycle just yet, opting instead to maintain the current interest rate levels for a longer duration.

Technical Analysis for EUR/USD

On the H4 chart, EUR/USD has shown a downtrend, reaching a low of 1.0802. It’s anticipated that a corrective movement could occur next. After this correction, the price is expected to decline to 1.0785, where it might form a consolidation range. A break below this range could lead to a further decrease towards the local target of 1.0720. This bearish scenario is supported by the MACD indicator, with its signal line positioned below zero and the histogram indicating a sharp decline, suggesting a potential further decline in the price to new lows.

The H1 chart presents a consolidation phase around 1.0824, followed by a potential drop to 1.0784. After reaching this level, the price may rebound to 1.0850 before descending again to 1.0720. This analysis is corroborated by the Stochastic oscillator, with its signal line currently near 80 and anticipated to drop to 20, indicating the likelihood of further price movements within this trend.

 

Disclaimer: Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Financial News Forex and Currency News
26 Feb

Trade Of The Week: EURNZD to keep above key support?

By ForexTime 

  • EURNZD rebounds from key support
  • RBNZ decision + EU data in focus
  • Trend bearish on D1 but bulls present
  • Key level of interest at 50-day SMA
  • Bloomberg model: 75% chance range 1.7384 – 1.7768

After practically erasing its 2024 gains last week, the EURNZD kicked off Monday with renewed bullish force!

Bulls returned to the scene, pushing prices back above 1.7550 ahead of a potentially volatile week for the minor currency pair.

Note: A minor currency pair does not include the USD but includes at least one of the world’s majors. 

Looking at the past few weeks, the EURNZD has been on a rollercoaster ride thanks to technical and fundamental forces. Although prices have been edging lower on the weekly charts, key support can be found at 1.7420.

To put things into context, the last time the EURNZD secured a weekly close below this level was back in early January 2023.

On the monthly charts, there is a similar picture with prices waiting for a fresh fundamental spark to trigger the next big move.

With all the above said, here are 3 reasons why this could be a wild week for the EURNZD:

  1. RBNZ rate decision

The Reserve Bank of New Zealand is widely expected to keep its key rates unchanged at 5.50% at its February 28th meeting.

Economic growth unexpectedly contracted in Q3 while there have been consistent signs of cooling price pressures. However, traders are still pricing in a 54% probability of one more rate hike by May 2024 with the first rate cut expected by November. Much attention will be directed towards the monetary policy statement which may provide fresh insight into the central bank’s thinking for 2024.

  • Should the RBNZ strike a hawkish note and signal one more hike could still be on the cards, this may strengthen the New Zealand Dollar. 
  • Any hint of doves or signs that the next move could be a cut has the potential to weaken the NZD, pushing the EURNZD higher as a result.

  1. Key EU data

It is a week packed with top-tier data from Europe, but the standouts are the Germany and Eurozone February inflation reports. 

These incoming inflation reports could influence expectations about when the European Central Bank (ECB) will start cutting interest rates in 2024. Traders are currently pricing in a 30% probability of a rate cut by April with a move by the ECB fully priced in by June 2024. 

Given how the inflation data and other data from Europe may influence these bets, it could be reflected in the EURNZD.

  • If overall data from Europe, including sticky inflation numbers, support the argument around the ECB keeping rates higher for longer – this could boost the euro.
  • Signs of cooling price pressures and soft data may fuel speculation around lower rates in Europe, dragging the euro lower. 

  1. Technical forces

The EURNZD remains in a noisy range on the daily charts with support at 1.7420 and resistance around 1.7700. Although the trend since mid-January points south, bulls are lingering in the vicinity.

  • A strong breakout and daily close above the 50-day SMA at 1.7600 may encourage an incline towards 1.7700 and the 100-day SMA at 1.7760. 
  • Should the 50-day SMA prove to be reliable resistance, this may trigger a decline back towards 1.7420 and 1.7384.

According to Bloomberg’s FX forecast model, there’s a 75% chance that EURNZD will trade within the 1.7384 – 1.7768 over the next week.

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Financial News Forex and Currency News
← Previous Page
Next Page →