Category Archive: 4) FX Trends

Main Author Marc Chandler
Marc Chandler
He has been covering the global capital markets in one fashion or another for more than 30 years, working at economic consulting firms and global investment banks. After 14 years as the global head of currency strategy for Brown Brothers Harriman, Chandler joined Bannockburn Global Forex, as a managing partner and chief markets strategist as of October 1, 2018.
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The Dollar is King. What will keep it king this week?

2022-09-25

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The dollar is king with the EURUSD trading to the lowest level since 2002. The GBPUSD traded to the lowet level since 1985. The AUDUSD, NZDUSD and the NZDUSD traded to the lowest level since the 2020 pandemic plunge. Even the USDCHF rallied despite the 75 basis point hike. The USDJPY rebounded Friday and is back at neutral short term technical levels even after a BOJ intervention this week.   The trend to the upside in the USD is strong but...

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Macro: Tell Us Something We Don’t Already Know

2022-09-24

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2022-09-24

As September winds down, three sets of economic reports will draw the most attention. We will review them and then offer a snapshot of the emerging market central bank meetings.

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The markets are in motion. Stocks are lower. Yields are higher. The USD is higher.

2022-09-23

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The major markets from stocks to bonds to currencies are on the move again today. The UK proposed a sharp tax cut along with energy helped to the consumers, and the markets are not taking it well. UK yields are up sharply, stocks  are down sharply. German yields above 2% for the 1st time since 2011. US yields continued their move to the upside with the 10 year moving above 3.8% earlier today. US stocks are looking to open lower with the...

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The BOJ intervenes sending the USDJPY lower. The SNB raises rates by 50 BPS. CBs go wild

2022-09-22

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Lots of central bank action as they go wild with policy signal. The action sends currency rates around. - The Federal Reserve raised rates by 75 basis points yesterday - The Bank of Japan kept rates unchanged but intervene in the currency markets - The Swiss National Bank raise rates by 75 basis points and the threaten to intervene in the currency market - The Bank of England raise rates by 50 basis points with some dissenters looking for a higher...

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It will be Enough, even if Too Much

2022-09-22

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2022-09-22

Business travel commitments keep me from updating the blog until the weekend, but I wanted to share a few thoughts post-Fed. First, the Fed was more hawkish, and the median dot sees 125 bp increase in the target rate in Q4.  The hawkish thrust was also evident in projecting that the target rate will remain higher for longer.  Even in 2025 sees the target rate above the longer-term (neutral) level.   Second, the market still does not fully accept...

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As the FOMC dust settles, what are the technical driving the currencies vs the USD

2022-09-21

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The FOMC raised rates by 75 basis points and also sent the market a warning that they see even higher rates than the market expects.  The price action saw the dollar move higher initially , but then down as comments in the presser showed less hawkishness from the Fed chair. However, as the dust settled, the more hawkish overtures restarted and the dollar moved higher.   What next? In the vidoe, Greg Michalowski looks at ALL the major...

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Putin and Powell Lift Dollar

2022-09-21

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2022-09-21

Overview: Between Putin’s mobilization of 300k Russian troops and Fed Chair Powell expected to lead the central bank to its third consecutive 75 bp hike later today, the dollar rides high. It has recorded new two-year highs against the dollar bloc and Chinese yuan, while sterling was sent to new lows since 1985. Asia Pacific bourses were a sea of red for the sixth decline in the regional benchmark in the past seven sessions. Surprisingly, Europe’s...

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The Greenback Firms to Start the New Week, Stocks Slide

2022-09-19

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2022-09-19

Overview:  The busy week is off to a slow start as Japan is on holiday and the UK and Canadian markets are closed to honor Queen (Australia will commemorate with a holiday on Thursday). Nevertheless, the sell-off in equities continues and the US dollar is firm. Most of the large markets in Asia fell. India is a notable exception. Its benchmark rose for the first time in four sessions, helped by bank shares and Infosys. Europe’s Stoxx 600 is off for...

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The Dollar may Stabilize Ahead of the FOMC

2022-09-18

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2022-09-18

Verbal intervention proved sufficient to keep the US dollar below JPY145, but the greenback gained broadly. It rose to new two-year highs against the dollar-bloc and Chinese yuan ahead of the weekend and to levels against sterling not seen since 1985.

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No One Wants a Recession, but Central Banks are willing to Take the Risk to Demonstrate Anti-Inflation Resolve

2022-09-17

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2022-09-17

The week ahead is busy. Three G7 central banks meet, the Federal Reserve, the Bank of Japan, and the Bank of England. In addition, Japan and Canada report their latest CPI readings, and the flash September PMI are released.  There are three elements of the Fed's meeting that are worth previewing. First is the interest rate decision itself and the accompanying statement. Ironically, this seems to be the most straightforward. Even before the August...

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The Dollar Heads into the Weekend Well Bid

2022-09-16

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2022-09-16

Overview:  The dollar is well bid. It has risen to new two-year highs against the dollar bloc and Chinese yuan. Aided by worse than expected retail sales, sterling, on its anniversary of leaving the European Exchange Rate Mechanism fell to its lowest level since 1985. This fits into the broader risk-off move. The S&P 500 fell to new two-month lows yesterday, and FedEx warnings after the bell yesterday add to the string of worrisome comments...

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Calmer Capital Markets…for the Moment

2022-09-15

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2022-09-15

Overview: The capital markets are quiet today. Equity markets and bond yields have a slight upside bias, while the dollar is little changed. Despite reports that the lockdown in Chengdu is easing, Chinese equities underperformed in the Asia Pacific region.

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Markets Remain on Edge

2022-09-14

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2022-09-14

Overview: The firmer than expected US CPI set off a major reversal of the recent price action. It is a two-prong issue. The first is about inflation and the squeeze on the cost-of-living.

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The USD runs higher after stronger CPI. A look at the technicals after the US CPI data

2022-09-13

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USDJPY: The USDJPY moved above its 100 hour MA and looks toward the high from last week at 144.498 EURUSD: The EURUSD has moved back below its 100 hour MA at 1.0054 and looks toward the 200 hour MA at 0.9998 now. The pair fell back in the lower swing area on the daily below 1.0096 to 1.0121

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Will the Dollar Recover After CPI?

2022-09-13

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2022-09-13

Overview: The US dollar remains offered ahead of today’s CPI report. Most European currencies are outperforming the dollar bloc, and the greenback is holding inside yesterday’s range against the yen. Most emerging market currencies are firmer, as well.

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Making sense of your senses in your trading

2022-09-13

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We as humans use our senses in all aspects of life, and such is the case with trading. Do you feel and hear what the market is telling you?

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The morning forex technical report for September 12, 2022

2022-09-12

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The USD is trying to move lower, but finding some resistance in doing so. I look at the EURUSD, USDJPY and GBPUSD in the morning technical report.

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Careful about Chasing the Dollar Lower in North America Today

2022-09-12

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2022-09-12

The bout of profit-taking on long dollar positions begun last week has carried into the start of this week. Despite the escalating rhetoric, the yen is not participating today and is trading within the pre-weekend ranges. The greenback’s lows have been set in the European morning and have stretched the intraday momentum indicators, suggesting that North American dealers may not follow suit.

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The Dollar: Was it the ECB and BOJ or the Bounce in Equities?

2022-09-11

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2022-09-11

After extending its recent gains, the dollar fell sharply at the end of last week. Many factors could have sparked the pullback, including the stronger expressions of concern by Japanese officials with an implicit threat of intervention and perceptions of an increased likelihood that the ECB will deliver another 75 bp hike next month.

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