US Dollar Weekly Technical Forecast Ahead of FOMC

US Dollar Technical Outlook:

  • US Dollar Index (DXY) rallying off support
  • Keeps upward trend generally intact as long as it lasts
  • FOMC on Wednesday, rise in volatility to be expected

Check out the DailyFX Trading Guides page for intermediate-term forecasts, educational content aimed all experience levels, and more.

US Dollar Index (DXY) rallying off support

Ahead of the FOMC on Wednesday, the US Dollar Index (DXY) is thus far getting a strong bid off a confluence of support arriving via a trend-line (underside of a weekly wedge pattern) coupled with the 200-day MA.

The ‘line-in-the-sand’ currently stands at the trough of last week’s swing-low of 96.46, but is moving higher in-line with the slope of the trend-line/MA combo. As long as price stays above support, then the trading bias is neutral at worst to bullish. However, it is unclear yet if we will see sustained momentum on this upswing, as rallies for quite some time have run out of steam in relatively short periods of time.

If the DXY can keep up a good pace, though, in the days ahead it could once again find itself in a battle with the 98.30s, the capper on the past two rallies. A breakout to the best levels seen in over two years will still be viewed with a wary eye, however; because as it stands in this low-volatility environment chasing momentum has been an unfruitful endeavor.

If the Dollar weakens again, watch how support is treated on a retest. Should it break it would seem that sellers will show up in earnest as the market is caught leaning the wrong way. Bottom line is, weakness appears more likely to spur volatility than further strength.

Check out the IG Client Sentiment page to find out how changes in positioning in major markets could signal the next price move.

US Dollar Index (DXY) Weekly Chart (Wedge)

DXY

US Dollar Index (DXY) Daily Chart (Rising support remains in place)

DXY

Helpful Resources for Forex Traders

Whether you are a new or experienced trader, we have several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.

—Written by Paul Robinson, Market Analyst

You can follow Paul on Twitter at@PaulRobinsonFX

S&P 500, FTSE 100 Outlook: Trade War Deadline, Brexit Vote, Fed Powell Testimony in Focus

SPX

S&P 500 and DAX Equity Analysis and News

  • S&P 500 | Federal Reserve Key to Record High Test
  • DAX | Markets Don’t Believe the ECB Has What it Takes
  • FTSE 100 | Bank of England Remain on Sidelines Despite Hawkish Hints

S&P 500 | Federal Reserve Key to Record High Test

Calls for the Federal Reserve to loosen monetary policy have grown louder and louder since the breakdown in trade talks between the US and China in May with little to suggest that a deal will be struck in the short term. Alongside this, US data has also continued to weaken with a poor NFP report and slightly softer inflation report raising expectations that the Fed could begin to signal to ease policy (in the form of rate cuts).

As shown in the graph below, what has been apparent is that markets have gone back to the old mantra that “bad news is good news for equities”, given that weaker data will push the Federal Reserve in the direction of loosening monetary policy.

SPX

Fed Are All Talk, Equities Need Action

Next week will be critical for the short-term outlook for US equities with investors largely focusing on the FOMC meeting, where the Federal Reserve could signal an easing bias to tee up a rate move at the July meeting. As it stands, Fed Fund futures are fully priced for a rate cut in July with another 25bps cut seen happening by October. Provided the Fed signals that rates could be on the way back down, risks are on the upside for equity markets in the near term with the S&P 500 challenging record highs. However, failure to meet the dovish expectations priced in by signaling that there is not a strong case to make an imminent move could see the S&P 500 back below 2800.

FED

S&P 500 Price Chart: Daily Time Frame (Apr 18 – Jun 19)

SPX

DAX | Markets Don’t Believe the ECB Has What it Takes

At last week’s post ECB press conference, President Draghi noted that some members had talked about rate cuts, QE resumption and extending the forward guidance. This view had also been backed up by ECB member Olli Rehn. However, eyes have been on Eurozone inflation expectations, which have been falling at an alarming rate and now hovers around record lows at 1.19%. As such, this suggests that the markets essentially don’t believe the ECB has enough fire power to reflate the economy and handle an economic downturn. Consequently, in light of the plunge in inflation expectations eyes will be on commentary from Draghi next week at Sintra, which could provide new clues to the outlook of monetary policy, particularly given that money markets are pricing in 70% chance of a 10bps cut by the year-end.

EUR

Following the break above the descending trendline from the 2019 peak, the DAX is now eyeing a test of the 12300, in which dovish policy signals from the likes of the Fed or ECB opens up a move towards YTD highs at 12460. Support is situated at 11900 and 11600.

DAX Price Chart: Daily Time Frame (Dec 2017 – Jun 2019)

DAX

FTSE 100 | Bank of England Remain on Sidelines Despite Hawkish Hints

Over the past week, the BoE hawks had been out in force with Haldane and Saunders both signaling that rates could rise faster than what the market expects. However, while this may raise the possibility that there could be a hawkish dissenter in the upcoming meetings, the bottom line is that the BoE will likely remain on the sidelines as long as Brexit uncertainty persists.

FED

Source: DailyFX, Hawk and Dove meter

Aside from the BoE, eyes will be on the Conservative leadership contest (Tory Contest timeline). As it stands, the candidate to beat is Boris Johnson who steam-rolled the first round, which in turn, as odds increase for Boris Johnson to become the next Prime Minister, no-deal risks will also pick-up, given that the Tory MP is willing to leave the EU by October 31st with or without a deal. As such, the FTSE 100 may outperform the domestically focused FTSE 250 in such case.

FTSE 100 Price Chart: Daily Time Frame (Mar 2018 – June 2019)

FTSE

RESOURCES FOR FOREX & CFD TRADERS

Whether you are a new or experienced trader, we have several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.

— Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX

Forex Brokers Update — June 16th, 2019

No new brokers appeared on EarnForex.com this week, just a few updates to the listed companies:

AvaTrade now accepts Boleto, FasaPay, and UnionPay for payments. МТ5 demo accounts are now available. Traders can also keep account balance in Australian dollar, Japanese yen, Swiss franc, and Great Britain pound. Customer support service through office is no longer available.

Price Markets no longer works with Skrill. Added Swiss franc as an account currency.

PFD raised margin-call and stop-out levels and reduced minimum account size for MT4 Pro accounts to $1.

Pepperstone added deposits through Skrill and PayPal. Increased its floating spreads somewhat.

PaxForex now supports trading in XRP/USD (Ripple vs. US dollar).

Orbex added FasaPay to payment options.

One Global Market added support for UnionPay and BPAY.

One Financial Markets added UnionPay and FasaPay payments. Closed its office in Hong Kong.

Grand Capital opened offices in Kenya and Ecuador.

If you have any questions or comments regarding any of the latest Forex brokers updates, please feel free to reply using the form below.

BUX Raises $12.5 Million, ESMA Praises Binary Bans: Editor’s Pick

It’s been a busy week in the foreign exchange (forex) and cryptocurrency industries. In case you missed any of the top and most interesting news in the space, here is a recap in our best of the week segment.

Interview with Intertrader’s CEO Shai Heffetz

Intertrader has been quietly making some big changes. Recently the broker has acquired two firms – Sigma Trading and Argon Financial.

Discover the Barcelona Trading Conference – A Top Tier Crypto Trading Event

With those two acquisitions in mind, as well as a large-scale rebranding effort on the part of Intertrader, Finance Magnates spoke with the CEO of the broker Shai Heffetz to find out what the firm’s plans are for the future.

You can take a look at the whole interview here.

BUX Raises $12.5 Million to Acquire Ayondo UK Subsidiary

This week, retail brokerage BUX announced that it has raised $12.5 million in funding. As Finance Magnates reported, that money will be put towards acquiring Ayondo Markets Limited (AML), the UK-regulated subsidiary of brokerage giant Ayondo.

The money that BUX raised came predominantly from venture capital firms Velocity Capital and Holtzbrinck Ventures.

ESMA Praises Binary Bans and CFD Restrictions

Over the past few months, more and more financial regulators within Europe have either implemented permanent national rules that mirror the European Securities and Markets Authority’s (ESMA) product intervention measures against binary options and CFDs, or have announced they are planning to do so.

This week ESMA issued five positive opinions on the introduction of similar rules by other national regulators across Europe. As you can expect, the pan-European regulator is extremely pleased with the movement. Read more here.

Craig Wright Ordered to Show Up in Court

Craig Wright, the self-proclaimed creator of Bitcoin, has been ordered by a Florida judge to attend court proceedings next week after his motion to postpone the case or allow his attendance via video conferencing was rejected.

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The case, which was filed against Wright by the estate of the late IT security‎ expert Dave Kleiman, alleges him of stealing between 500,000 and 1 million bitcoin. Find out the details here.

Broadridge Acquires RPM Technologies for $300 Million

Having only announced the deal last month, Broadridge Financial Solutions revealed this week that it has completed its acquisition of RPM Technologies, a Toronto-based provider of enterprise wealth management software solutions and services.

As Finance Magnates reported, Broadridge is going to pay $300 million to acquire RPM Technologies. Though there were several sellers, Bayshore Capital – a Canadian real estate, financial services, and technology private equity firm – was RPM Technologies’ biggest shareholder.

Interview: STOs Are the Future of Fundraising

Various kinds of token sales have been an extremely important part of the rise of cryptocurrency. Initial Coin Offerings (ICOs), Initial Exchange Offerings (IEOs) and Security Token Offerings (STOs) have typically been the most popular choice.

However, in an interview with Finance Magnates, Adv. Ziv Keinan, the founder of Ziv Keinan Digital Assets Lawyers, said that STOs are the future of crypto fundraising.

But that’s not all he said, as Keinan also discussed the past, present, and future of the Security Token space. Check out the full interview here.

Seed CX Partners with Caspian

Seed CX, an institutional digital asset exchange, is expanding its reach through a new partnership with Caspian, which provides a crypto portfolio and risk management platform, as Finance Magnates reported.

Under the partnership, Seed CX will be integrated as a trading venue on Caspian’s trading and portfolio management system, which includes an OEMS, PMS and RMS. Once the integration is complete, Caspian’s users would be able to access Seed CX’s crypto asset exchange..

Two Ex-Swissquote Execs Launch Guru Capital SA

After stepping down from his role as head of FX trading at Swissquote, Ryan Nettles is now a Managing Partner at Guru Capital SA, a private equity firm based in Switzerland. Joining Nettles is Luca Merolla, who is the second Managing Partner and a former executive at Swissquote.

Nettles confirmed the new venture to Finance Magnates and said Guru Capital is currently seeking investment opportunities with active companies in the EMEA and APAC regions who have a special focus on FX & CFD brokerage, asset management, and FinTech.

USDJPY Weekly Analysis – June 16, 2019

USDJPY remains in the downtrend from 112.40, the bounce from 107.81 could be treated as consolidation for the downtrend. As long as the price is below the falling trend line on the daily chart, the downside movement could be expected to continue and next target would be at 107.00 area. Only a clear break above the trend line resistance could signal completion of the downtrend.

USDJPY daily chart

EURUSD Weekly Analysis – June 16, 2019

After touching the bearish trend line on the daily chart, EURUSD pulled back from 1.1347, indicating that the pair remains in the downtrend from 1.1570. Further decline could be expected in a couple of weeks and next target would be at 1.1000 area. Key resistance is now at 1.1347, only break above this level could signal completion of the downtrend.

EURUSD daily chart

Crude Oil Price Trading Bias Bearish as Chart Resistance Pressured

Crude Oil Technical Forecast: Neutral

  • Are crude oil prices on the verge of a near-term correction?
  • Net-long positioning still offering a bearish-contrarian bias
  • Downtrend resumption opens the door to testing 2018 lows

Build confidence in your own Crude Oil trading strategy with the help of our free guide!

Crude Oil Technical Outlook

Crude oil prices aimed lower this past week despite rising US-Iran geopolitical concerns stoking fears about supply disruption. Fundamentally, the persistent downward trajectory speaks to the uncertain outlook for demand, via a slowdown in global growth, which is undermining efforts by OPEC to reduce output and support prices. Oil has fallen over 20 percent since April.

Technically, the descent in oil followed a break under the rising trend line from the end of last year which occurred in late April. On its path lower, support levels were taken out at 60.26, then 57.34, followed by 54.55. Now, the psychological range between 50.41 – 52.08 appears to be holding. Is this the turnaround for crude oil when looking at it from a technical perspective?

To answer this question let’s take a look at the daily chart below where we can see that the commodity is making an attempt to breach near-term descending resistance from the middle of May. Notice that in the leadup, positive RSI divergence formed which indicated fading momentum to the downside. At times, this can precede a turn higher.

Given such persistent losses in recent weeks, sentiment-linked oil may very well be due for a correction. A fundamental catalyst could come from the Fed rate decision this week, where markets will be eyeing a material dovish shift in rhetoric. This places the focus on the next range of resistance between 54.55 and 55.41.

Crude Oil Daily Chart

WTI

As is the usual with technical analysis, breaks above trend lines require confirmation and we can get a better look at them by zooming in on the 4-hour chart below. Note the presence of positive RSI divergence here too. The deterioration in downside momentum occurred as prices oscillated between support and resistance since the beginning of this month.

If we get a material upside push in crude oil and near-term resistance is taken out, the next area of interest seems to be a range between 57.34 and 57.93, Just beyond that is what could be a falling trend line that forms down the road. I have highlighted this as the downward-sloping blue line on the chart below.

Crude Oil 4-Hour Chart

Crude Oil Price Trading Bias Bearish as Chart Resistance Pressured

* Charts created in TradingView

Yet, IG Client Positioning reveals that most traders are net-long the commodity, and this is offering a bearish-contrarian trading bias. In the event of downtrend resumption, keep an eye on the October 2017 low around 49.13. Beyond that opens the door to eventually taking out support until reaching the 2018 low at 42.23.

Join me every week on Wednesday’s at 00:00 GMT as I uncover what market positioning has to say about the prevailing trends in markets where I will also be going over how you can incorporate this into your own analysis and trading strategies!

For more updates on crude oil, including fundamental developments, feel free to follow me on Twitter here @ddubrovskyFX.

Crude Oil IG Client Positioning

Crude Oil Price Trading Bias Bearish as Chart Resistance Pressured

FX Trading Resources

— Written by Daniel Dubrovsky, Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter