U.S. dollar (DXY) | EUR/USD Forecast Update + Upside Targets
The main mover last week was the strength of the US dollar, which was bolstered by a new 30-year high from the US consumer inflation report. It seems that we are merely continuing that trend into the new trading week, but a simple glance at other USD-based crosses immediately dispels that assumption. GBP/USD, USD/CAD, AUD/USD, and NZD/USD were among the major currencies that saw losses. The DXY did not have a significant drop, but it did not experience the rally predicted by the benchmark cross. The onus of performance would therefore fall on a Euro decline.
This corresponds to a drop in the EUR/GBP, EUR/JPY, and EURAUD. What caused the world's second most liquid currency to fall in value? Christine Lagarde said in her evidence to the European Parliament that the policy group anticipated consumer inflation to be higher than predicted in the next year, but that they would bear the burden without raising the benchmark rate. The market's main fundamental guiding light is still inflation, but it doesn't imply the topic is always dominant.
Even if the EUR/USD continues to fall to a new 16-month low. The charge from last week's lofty price readings (the US CPI update reached a three-decade high) and new headlines, such as President Biden's signing of the $1 trillion infrastructure plan into law, didn't appear to awaken the wider stock markets during the first session of trading. The SPX remained largely unchanged from Friday's closing, while the more volatile Nasdaq 100 was just -0.1 percent down. Given their closeness to record highs and the entrenched expectations engendered by seasonality's momentum, it's surprising that the "buy the dip" call hasn't sparked more excitement. Where the constraint is statistically even more amazing than the Dow's estimate of realized volatility. The blue chip's ATR (average true range) has slid to its lowest level since December 2nd, 2019, in the last 20 trading days - almost one month. The lengthy decline from the world's most liquid currency pair was tough to miss for those following track of macro trends. For the first time since July 2020, the EUR/USD plummeted 0.7 percent, or 76 pips, to settle below 1.1400. This seems to be a clear acknowledgement of the technical significance of last week's 1.1500 breach, which marked the midway of the March 2020 to January 2021 bull wave, followed by the 1.1450 key-level, which marked the peak of the January 2017 to February 2018 rally.
On the one hand, there is a poor case to be made for the relative perspective of economic potential on the passage of the United States' infrastructure package, but we had enough of notice. The main impetus for this cross, in my opinion, was the monetary policy background of riding the inflation wave.
There are a few fundamental listings worth paying attention to in the current London and subsequent US hours of trading.-
There are a few fundamental listings worth paying attention to in the current London and subsequent US hours of trading.
If the Dollar can take control of the EUR/USD momentum, it will be a more fundamentally sensible move.Despite the fact that we are nearing the conclusion of third-quarter corporate reporting, this week's topic is retail behemoth.
When the financial system is rife with "anxiety," safe havens like the US Dollar often experience a high bid as money seeks refuge. The dollar rose this past session, providing a noteworthy counterweight to the S&P 500's decline. The trade-weighted DXY index saw its highest single-day gain since mid-June, and it then broke above the 94.50 resistance level, which had held it back for 15 months and show's clear signs of importance to the index among market makers and traders alike. The rise signals a break through a key milestone at 1.1500.
It's conceivable that risk aversion is boosting the dollar's bid, but I think the surge is mostly a reaction to the charged implications for US rates after the consumer inflation data for the previous month.
This corresponds to a drop in the EUR/GBP, EUR/JPY, and EURAUD. What caused the world's second most liquid currency to fall in value? Christine Lagarde said in her evidence to the European Parliament that the policy group anticipated consumer inflation to be higher than predicted in the next year, but that they would bear the burden without raising the benchmark rate. The market's main fundamental guiding light is still inflation, but it doesn't imply the topic is always dominant.
Even if the EUR/USD continues to fall to a new 16-month low. The charge from last week's lofty price readings (the US CPI update reached a three-decade high) and new headlines, such as President Biden's signing of the $1 trillion infrastructure plan into law, didn't appear to awaken the wider stock markets during the first session of trading. The SPX remained largely unchanged from Friday's closing, while the more volatile Nasdaq 100 was just -0.1 percent down. Given their closeness to record highs and the entrenched expectations engendered by seasonality's momentum, it's surprising that the "buy the dip" call hasn't sparked more excitement. Where the constraint is statistically even more amazing than the Dow's estimate of realized volatility. The blue chip's ATR (average true range) has slid to its lowest level since December 2nd, 2019, in the last 20 trading days - almost one month. The lengthy decline from the world's most liquid currency pair was tough to miss for those following track of macro trends. For the first time since July 2020, the EUR/USD plummeted 0.7 percent, or 76 pips, to settle below 1.1400. This seems to be a clear acknowledgement of the technical significance of last week's 1.1500 breach, which marked the midway of the March 2020 to January 2021 bull wave, followed by the 1.1450 key-level, which marked the peak of the January 2017 to February 2018 rally.
On the one hand, there is a poor case to be made for the relative perspective of economic potential on the passage of the United States' infrastructure package, but we had enough of notice. The main impetus for this cross, in my opinion, was the monetary policy background of riding the inflation wave.
There are a few fundamental listings worth paying attention to in the current London and subsequent US hours of trading.-
There are a few fundamental listings worth paying attention to in the current London and subsequent US hours of trading.
- - The October UK employment statistics and the Eurozone 3rd quarter employment shift provide key labor market updates for the European continent, but the market hasn't reacted with much volatility.
-The October UK employment statistics and the Eurozone 3rd quarter employme The October industrial production statistic and the November NAHB housing market index will provide a more thorough economic assessment.
-The October import and export inflation statistics may add to the pressure applied by last week's data, to come up with a lot more productive market theme.
If the Dollar can take control of the EUR/USD momentum, it will be a more fundamentally sensible move.Despite the fact that we are nearing the conclusion of third-quarter corporate reporting, this week's topic is retail behemoth.
When the financial system is rife with "anxiety," safe havens like the US Dollar often experience a high bid as money seeks refuge. The dollar rose this past session, providing a noteworthy counterweight to the S&P 500's decline. The trade-weighted DXY index saw its highest single-day gain since mid-June, and it then broke above the 94.50 resistance level, which had held it back for 15 months and show's clear signs of importance to the index among market makers and traders alike. The rise signals a break through a key milestone at 1.1500.
It's conceivable that risk aversion is boosting the dollar's bid, but I think the surge is mostly a reaction to the charged implications for US rates after the consumer inflation data for the previous month.
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