2021-01-26 • Updated
Analysts from TD Securities claimed that "risk sentiment could struggle to find near-term highs just as the global growth backdrop shifts lower, leaving us inclined to hold a sell on rallies posture for the EUR. With this in mind, we implement a short EURUSD position as our Trade of the Week".
The bank sees investor sentiment and the stock market’s performance as key drivers. Indeed, Biden’s stimulus package isn’t likely to be unveiled till mid-March. In combination with the vaccine delays, these issues worsened the sentiment.
Besides, investors express concerns about whether the global stocks are overextended or not. As a result, the backdrop in stock growth increases the demand for the US dollar. Moreover, Fed’s meeting this Wednesday may trigger a pick up in the yields, if the Fed claims to withdraw stimulus earlier than expected. Rising yields will underpin the USD.
TD Securities expects EUR/USD will reach 1.2050 by the end of January.
On the daily chart, EUR/USD is supported by the 50-day moving average at 1.2100, which the pair has failed to cross several times. However, we shouldn’t rule out that the euro may drop below this level amid the current strong fundamentals. Therefore, the breakout of 1.2100 will drive the pair to the low of January 18 and the lower line of Bollinger Bands at 1.2050. The MACD indicator is moving back and forth near the zero line. When the MACD gets below 0 to turn negative, it can be used to confirm a downtrend. Resistance levels are at the recent highs of 1.2200 and 1.2260.
Crude oil futures surged on Monday due to disruptions in Russian refining capacity caused by Ukrainian drone strikes and Moscow's decision to cut output to comply with OPEC+ targets. The West Texas Intermediate (WTI) contract for May settled at $81.95 a barrel, up $1.32, while the Brent contract for May settled at $86.57 a barrel, also up $1.32. Russia instructed...
Bearish scenario: Sales below 80.00 with TP1: 79.60... Anticipated bullish scenario: Intraday purchases above 80.70 with TP: 81.50...
Bearish Scenario: Sales below 78.99 with TP1: 77.93, TP2: 77.45, and upon its breakout TP3: 76.56 and TP4: 75.70 Bullish Scenario: Purchases above 78.00 (wait for a pullback to this area) with TP1: 1679.00 (uncovered POC*), TP2: 79.33, and TP3: 79.66 intraday
Jerome H. Powell, the Federal Reserve chair, stated that the central bank can afford to be patient in deciding when to cut interest rates, citing easing inflation and stable economic growth. Powell emphasized the Fed's independence from political influences, particularly relevant as the election season nears. The Fed had raised interest rates to 5.3 ...
Hello again my friends, it’s time for another episode of “What to Trade,” this time, for the month of April. As usual, I present to you some of my most anticipated trade ideas for the month of April, according to my technical analysis style. I therefore encourage you to do your due diligence, as always, and manage your risks appropriately.
Bearish scenario: Sell below 1.0820 / 1.0841... Bullish scenario: Buy above 1.0827...
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Don’t waste your time – keep track of how NFP affects the US dollar and profit!
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