Dollar rebound after ECB meeting

9 September, 2016

We have seen a big drop in the dollar during the beginning of this week, after ISM Non-Manufacturing figures sank to 6-year low, sending a clear message to the market that a rate hike in the near future is very unlikely, especially after the recent disappointment in the U.S jobs report last Friday.

Immediately after these figures, September rate hike probability fell to 26.0% 30.8% in November while the chances for a move in December remain at 54.0%.

As of today, the U.S Dollar managed to bounce in the beginning of the U.S trading session on profit taking as September FED meeting looms.

Looking at the major economic releases which came out today, the ECB rate decision was a disappointment for investors today as the central bank decided to keep all the three-benchmark rates unchanged and to keep asset purchase program at 80 billion euros a month. In the meantime, the bank reaffirmed that it is planning to run QE until March 2017 or beyond if needed.

The Euro rose to as high as 1.1327 before to retreat below 1.1300 handle as the bullish momentum faded.

In the U.S, initial jobless claims dropped to 259K down from 263K previously while the continuing claims came out below estimates at 2144K.

Technically, the dollar remain bearish in the daily chart, while in the near-term, the outlook is flat. The Greenback keep trading sideways between 96.25 level in the upside and 94.00 support in the downside, which keeps the short-term view unclear. Therefore, traders should focus on this zone, as a break outside of it will trigger a big move in the dollar during the following days.

Looking at the levels of interest in the hourly chart, 94.40 is seen as the short-term support, in the opposite, 95.00/20 is considered as a strong resistance zone.


Source link  
Asian stocks, currencies mixed

Asian stocks and currencies are mixed, as the post-trade truce bounce is losing steam. Investors are now weighing up their next steps after news...

Asian stocks unable to follow US market lead

Asian stocks are mostly lower, unable to keep in step with the S&P 500 that erased early losses to close higher on Thursday. US equities saw a boost...

WTO cuts outlook for global trade growth

A gloomy outlook is hanging over financial markets after the World Trade Organisation (WTO) joined the growing list of major institutions expressing concerns...


Trump’s impeachment inquiry is just a distraction

Investors were caught by surprise when the Speaker of the US House of Representatives Nancy Pelosi announced on Tuesday that...

Powell gives green light to interest rate cut

The S&P 500 reached a new milestone high on Wednesday breaking above 3000 for the first time ever as Fed Chair Jerome Powell...

Powell primes markets for July Fed rate cut

Fed chair Jerome Powell's latest dovish comments have removed market doubts over a US interest rate cut in July. Such signals have translated into...


Euro barely blinks on election results

The Euro has opened the new trading week marginally higher against the Greenback following initial results from the Parliamentary elections in Europe...

More bad news for Sterling as EURGBP

Backlash - that would be the word used to sum up the investor reaction from the latest attempt by UK Prime Minister Theresa May to push forward her...

EURJPY sinks to flash crash levels

A wave of risk aversion engulfed global equity and foreign exchange markets on Thursday after Donald Trump accused China of breaking...

  


Share it on:   or