USD/JPY awaiting Fed's decision to set direction

The USD/JPY pair closed the week at 111.50, after had marked highest level for April at 111.77 and posted gains for second consecutive week. 

The continuation of the upside move seems now to be limited due to the falling yield on 10-year Treasury along with the neutral BOJ stance, that noted positive growth, but downgraded the inflation forecast for the current year.  

On the daily chart the 20-day SMA has turned to north. RSI and stochastic are placed within extreme overbought area and are keeping the bullish tone. The pair has crossed to above the 200-day SMA, whilst the 100-day SMA has slightly turned to south and is currently acting as dynamic resistance at 112.65.

How the pair will develop its direction will depend on how the market respond on Fed's monetary policy outcome next Wednesday. A bullish breakout will be more likely expected in the case of confirmation on the rate hike for next June. 

Super Mario and weak US macro data frigiled the EUR/USD pair

The initial reaction on Mario Draghi’s speech today pushed the EUR/USD pair towards 1.0933, which was influenced by the growing enthusiasm about the state of the euro-area economy.Ahead of the Wall street opening the pair dropped from the above mentioned high to 1.0850 and the current market price is 1.0879. Probably the freshly released US macro data on jobless claims and trade deficit, showing worse than expected numbers, saved the pair from further decline. 

The four-hour time frame is showing that technical indicators are entering negative territory. RSI is located at mid-lines, but has  slightly turning to north, while stochastic has moved sharply to oversold area with current location at 25. Meanwhile the pair crossed to below the 20-day SMA for first time this week.  

In case of moving below today’s low at 1.0850, next support is seen at 1.0820 (Monday’s low). Looking to the upside, recovery of the bullish trend will be possible only above 1.0920 (Monday’s opening gap) with further development towards 1.0950. 

100 days of trumpery tweets

We are quickly approaching April 29, the day that marks Donald Trump’s first 100 days in the White House. 

Despite he is constantly referring to the important 100-day landmark throughout the pre-election campaign, he said in an interview that it was an “artificial barrier” that people shouldn’t pay much attention to. 

But I think it worths, because these 100 days will be labelled as worst on record.

And here is my reading on how unsuccessful his agenda has been so far:

No considerable improvement on any major legislation. 24 executive orders, 13 signed Congressional Review Act resolutions, a failed health care bill and a stalled wall. 

Even the executive order on immigration is still stuck in the courts.  

Worst administration management ever. More than 50 nominations were made in order to fill 553 positions of the executive sector and until Friday last week yet 90% are not nominated. But the rest 10% provoked scandals with major consequences. 

Last but not least – the weak foreign policy. Is Trump acting as a globalist as he appeared when backing off his criticism of China or a protectionist, as he appeared to be when starting a trade spat with Canada?  Interventionist, isolationist or alternative?

Undeniable fact is that Donald Trump does not fail to share his thoughts on Twitter. The library of his moods, opinions, personal thrills and even diplomacy. He uses Twitter to break news, share his views and feud with critics and celebrities at all times of day or night. Lots of outbursts were read, but the masterpiece for me remains the criticism on China for its exchange rate policy and its operations in the South China Sea. And few days after „I don't regret anything”. 

As Seth Meyers said in his Late Night Show - “Trump is so ignorant that he’s ignorant of his own ignorance.” I found this quite meaningful.

*The idea of a president’s first 100 days comes from Franklin D. Roosevelt, who was actually referring to the first 100 days of a special Congressional session to fight the Great Depression.

* Trumpery has been in use in English since the late 15th century, and has been used, at one time or another, to refer to weeds, people, religious matters and generally worthless things in a broad sense. 

Loonie skyrocketed and marked 14-month high

The weak oil market and US threat to impose 20% tariffs on Canada’s soft-wood lumber exports set USD/CAD under huge pressure, but bulls seem to had found enough courage and the pair skyrocketed towards 1.3614, having posted an impressive rallied and marked a 14-month high.
The four-hour time frame is showing mixed signs for short term development. RSI is located within overbought territory at 73, stochastic has reached extreme levels, but has started to turn south, while the 20-day SMA is keeping bullish, which is suggesting slight decline during the day.

Therefor we must take into consideration the very important 1.3600 level (December 28th’s high) and in case of closing above it, the bullish tend is about to continue in longer term with next target seen at 1.3670.

EUR/USD Attempting to break out of the bearish trend carried over from 2016

EUR/USD started the new week week in good shape after yesterday’s historic win by centrist and pro-European Emmanuel Macron at the French presidential elections. 

The pair opened with a bullish gap and marked fresh new yearly high at 1.0919 because of the increased buying orders for single currency. The situation now suggest that market participants are withdrawing their bearish outlook as the pair is making significant attempts to escape from the downward trend carried over from 2016.

On the daily chart the 20-day SMA has turned to north, while RSI and stochastic are located withing extreme overbought area and seem that has lost directional strength.

Currently the pair is trading at 1.0852 and major resistances are seen at 1.0905 and higher at 1.0920. Looking to downwards first support is placed at 1.0840 and second at 1.0821.

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As a kind of investment bonds are known as „debt security”,  a sort of IOU, because when you buy a bond you’re actually loaning money to the entity that issued it. Also they are often called “fixed income” investments due to the fact that the amount of money you receive and the dates on which you receive payments are specified in advance, or „fixed”. And usually the fixed income securities are considered as less riskier than stocks.

Comparing to stocks again, which give insights to the financial conditions of a specific company, indices on the other hand provide a really good representation of markets’ nature and sectors as a whole. When trading indices, it’s very important to follow events that affect their values, such as geopolitical news, monthly employment reports  and economic reports. 

As you see bonds and indices are very interesting and broad matter that you can take advantage of.

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USD/JPY in consolidation mode

The USD/JPY pair has shifted to consolidation mode and is currently stuck between 109.30 and 108.30. In the early Asian session, the pair turned to  downside and declined to 108.63, which was about to reinforce the bearish tune. A possible break of 108.30 will drag the pair towards Monday’s low and will lead to retesting of the 108.00 level. If case the slide continues, next target is seen at 107.70. Bulls might come back along only with a recovery above 109.30 in order to gain support for further upward extension towards 109.70. Currently the trend favours the yen and only a break above 110.10 might shift the bias.