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1.25 - 1.255 caps EUR/USD for now

al_dcdemo Posted 23 Feb.  in #Trader's blog #Support #Resistance #EUR/USD #Rising Channel #Falling Trendline #W1 Chart
EUR/USD has been deflected three times in the falling 2008 - 2018 trendline zone near 1.25. The pair is however well entrenched in the rising 2017 - 2018 channel. We'll need to get below the 1.20 - 1.21 area on a sustained basis before we can begin to talk about a trend change.
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Cable could fall some more in the near term

al_dcdemo Posted 27 Aug. as Analysis on GBP/USD, Target: 1.2775, Date: 2nd of October, 12:00 GMT  in #Technical analysis #GBP/USD #Daily Chart #Rising Channel #Weekly Chart #Technical Tools #Net Short Positioning #Neutral Boe #Bottoming Area
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
Cable broke below a declining wedge in one of the most volatile weeks in the pair's history as U.K. opted out of E.U. A flash crash in October 2016 …
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al_dcdemo 15 Sep.

UPDATE 6: A hawkish hold by the BOE yesterday took many by surprise. Interest rates and voting pattern were left unchanged, as expected, but the minutes revealed that the majority of MPC saw as likely some withdrawal of monetary stimulus over the coming months, provided that economy continues on its current path. Having been already in a firm uptrend, GBP/USD took the decision in a stride. It gained almost two cents on the day and so far added a good cent this morning. The pair is currently trading at the highest level since the Brexit vote.

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al_dcdemo 16 Sep.

UPDATE 7: It was a positive week for the dollar, which closed higher against most major currencies. By far the best performer was British pound, which rallied on a hawkish shift from the BOE. New Zealand dollar closed marginally higher after some election polls indicated continuation of the status quo. Following weekly close below strong support at 108.10, yen reversed sharply and ended the week above 110.50. Next week's main event is FOMC meeting at which the committee is widely expected to announce balance sheet adjustment plan. Forward guidance on rates will be watched closely as well.

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al_dcdemo 20 Sep.

UPDATE 8: Fed remains on track with monetary policy. Balance sheet adjustment will start in October. Most members are expecting another hike this year. Three more hikes are projected for 2018. Neutral rate was downgraded to 2.8% from 3.0%. The market clearly expected something less hawkish from them. The dollar rallied across the board but the rally run out of steam after 100 - 150 pips of gains. Any further gains may not last because, fundamentally, nothing really changed today.

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al_dcdemo 1 Oct.

UPDATE 9: It seems that U.S. dollar finally found some traction. A rise in treasury bond yields after more hawkish than expected FOMC last week is one part of the story. The other is that despite all difficulties in passing new healthcare bill, U.S. tax reform may prove to be a success for Administration. In any case, market got ahead of itself on the convergence trade and what we are seeing now is probably just a healthy retracement and not an outright reversal. Another supportive factor for the dollar is that any weakness in September data will be dismissed due to hurricane impact.

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al_dcdemo 4 Oct.

UPDATE 10: Markets have been relatively sedate so far this week, at least major currency pairs. There was some movement in GBP/USD, which has continued its correction lower. Mostly weaker U.K. PMI readings and ever-present Brexit shenanigans haven't helped Cable. Technically, the pair broke back below 2016 - 2017 resistance line and August high. 50.0% retracement of the August - September rally is holding for now. Area between 50 DMA and 61.8% retracement is the next downside target. On the upside, 1.3325 - 1.3350 is where sellers may step in.

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Cable to remain well bid in August

al_dcdemo Posted 27 July as Analysis on GBP/USD, Target: 1.3225, Date: 1st of September, 12:00 GMT  in #Technical analysis #GBP/USD #Daily Chart #Short Squeeze #Rising Channel #Weekly Chart #Technical Tools #Net Short Positioning #Neutral Boe
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
Cable broke below a declining wedge in one of the most volatile weeks in the pair's history as U.K. opted out of E.U. A flash crash in October 2016 …
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al_dcdemo 19 Aug.

UPDATE 6: The week was to some extent a reversal of last week's risk-off moves. Canadian and Australian dollars were beneficiaries with yen and franc recording just marginal losses. It was not a good week for European currencies. Pound was the loser of the week while euro remains to be buoyed by dip buyers. Next week will be a quiet one data-wise. All eyes will be on Jackson Hole Symposium at the end of the week, which will feature speeches by Yellen and Draghi. Rumours go that the ECB president will avoid talking monetary policy. That will increase volatility if he does say something.

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al_dcdemo 24 Aug.

UPDATE 7: Price action has been pretty sedate so far this week with most major currencies sitting near the middle of their weekly ranges. Euro and Canadian dollar are the only two that are marginally better than the U.S. dollar. There has been a little bit more action in the New Zealand dollar but selling stalled ahead of the strong support at 0.72. Tomorrow could prove to be the most lively day of this week with German Ifo Business Climate, U.S. (Core) Durable Goods Orders and Day 2 of the Jackson Hole Symposium which will bring Fed Chair Yellen and ECB President Draghi speeches.

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al_dcdemo 26 Aug.

UPDATE 8: Speeches by Yellen and Draghi at Jackson Hole Symposium largely met expectations. Yellen didn't even talk about monetary policy while Draghi avoided giving any new information on what the ECB may do in autumn. Lack of hawkish clues from Yellen were enough to send the U.S. dollar lower across the board and then later some upbeat comments from Draghi (even though he warned about inflation not yet being self-sustained) propelled the euro to a new two-year high. Yen, pound and Australian dollar were flat on the week while New Zealand dollar was the laggard.

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al_dcdemo 31 Aug.

UPDATE 9: U.S. dollar index broke to the lowest level since 2015 on Monday before staging a sharp pullback. That coincided with euro breaking above 1.20 and 2012 low (1.2040) and franc below 0.95. Yen was once again contained by the strong support at 108. Kiwi is out of favour ahead of N.Z. general election. Canadian dollar sold off hard yesterday but already recouped all losses and some after strong Q2 GDP figure. Australian dollar has been the least volatile of the bunch but with some impressive reversals. NFP report tomorrow will be a nice finale to this exciting week.

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al_dcdemo 1 Sep.

UPDATE 10: U.S. labour market report for August fell short of expectations on most metrics. August is historically weak with regard to NFP figure but Wednesday's strong ADP figure gave dollar bulls some hope that this time was different. It wasn't and the immediate reaction was to sell the dollar. The report itself was not great but was solid enough and subsequent price action seemed to agree. The dollar ended the week higher against euro, franc, yen and New Zealand dollar, and lower against pound, Canadian dollar and Australian dollar.

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Cable may continue to drift lower for some time

al_dcdemo Posted 22 June as Analysis on GBP/USD, Target: 1.2575, Date: 1st of August, 12:00 GMT  in #Technical analysis #GBP/USD #Daily Chart #Short Squeeze #Rising Channel #Weekly Chart #Technical Tools #Net Short Positioning #Neutral Boe
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
Cable broke below a declining wedge in one of the most volatile weeks in the pair's history as U.K. opted out of E.U. A flash crash in October 2016 …
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al_dcdemo 15 July

UPDATE 5: It was a worst week for the U.S. dollar in a while. It all started with the BOC decision on Wednesday after which Canadian dollar surged about 200 pips. The next day, Aussie and Kiwi played catch-up and rose about 100 pips respectively. Eagerly anticipated U.S. inflation and retail sales reports came in weaker than expected yesterday and exacerbated dollar losses across the board. Cable sliced through 1.30 to 1.3115, the highest in ten months. Euro had tough time holding above 1.14 but ended the week near the high, poised for a break higher. Exciting week ahead.

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al_dcdemo 23 July

UPDATE 6: U.S. dollar ended another week of underperformance, falling against all major currencies bar the British pound. Euro confirmed break above 1.1450 to trade to the highest since mid 2015. Mirroring its cousin, Swiss franc closed the week below 0.95. Yen was bought down to 111. Canadian dollar extended its rally to approach 1.25. Australian dollar broke above 38.2% retracement of the 2014 - 2016 downswing. New Zealand dollar closed the week near 0.7450, just below the 50.0% retracement of the 2014 - 2015 decline. Momentum suggests further losses for the dollar in the week ahead.

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al_dcdemo 24 July

UPDATE 7: A mixed start to the week saw yen, pound, Canadian dollar and Australian dollar extend gains while euro, franc and New Zealand dollar are lagging. Data-wise, it's a quiet one until Wednesday when Australia publishes inflation data, U.K. releases preliminary GDP and FOMC concludes its meeting. U.S. reports durable goods orders on Thursday and GDP on Friday. Unless FOMC pulls a surprise, neither of these events has the potential change the current macroeconomic landscape. U.S. politics seems a more likely source from where some kind of a twist may come.

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al_dcdemo 27 July

UPDATE 8: Yesterday's reaction to the latest FOMC statement was quite strong for a meeting without press conference. The statement didn't divulge anything new but clearly the market was expecting something more hawkish. The committee indicated that it will begin with balance sheet adjustment "relatively soon". The language on inflation, however, has deteriorated a bit and that was probably the main reason the market sold the dollar. While balance sheet adjustment is now virtually a done deal, we may see further hikes in federal funds rate only if inflation picks up.

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al_dcdemo 31 July

UPDATE 9: Last week was an interesting one. Major currencies traded to fresh highs against the U.S. dollar. The single exception was Swiss franc which sold off strongly against all those currencies, including the dollar. Two cent and a half surge from sub 0.95 to above 0.97 might well have had SNB backing. There's nothing on the calendar for the week ahead that has the potential to reverse the current U.S. dollar weakness. Perhaps a concerted dovish effort from RBA and BOE could put a dent into this trend but most likely not for too long.

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Kiwi looks soggy but buyers are waiting in the dips

al_dcdemo Posted 29 Apr. as Analysis on NZD/USD, Target: 0.6975, Date: 1st of June, 12:00 GMT  in #Technical analysis #Daily Chart #NZD/USD #Rising Channel #Range Trading #Weekly Chart #Technical Tools #Net Short Positioning #Neutral Rbnz
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
Kiwi bottomed in August 2015 and was contained in a rising channel until recently. 2015/2016 support/resistance line and 100 week SMA are providing …
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al_dcdemo 14 May

UPDATE 5: Expected result of the French election spurred a pullback in euro and franc and, to a lesser extent, yen. The U.S. dollar indisputably won the week, rising against all G10 currencies. Weaker than expected inflation and retail sales reports on Friday led to some profit taking but June rate hike expectations hardly budged. Some further reaction to the reports is possible in the days ahead. Following a neutral BOE QIR, U.K. data will be closely watched next week. Australian labour force report and Canadian inflation and retail sales are also at the top of the list.

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al_dcdemo 21 May

UPDATE 6: In what was its worst week of the year, the dollar lost ground against all G10 currencies. Already soft start to the week after last Friday's inflation and retail sales reports was exacerbated by the political drama in the U.S. that has further shaken traders' confidence that the Administration will be able to deliver on its stimulus promises in due time. The biggest winners were euro and franc with Canadian dollar and pound not far behind. U.S. dollar index fell to the levels not seen since the U.S. election and closed the week near the low.

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al_dcdemo 25 May

UPDATE 7: As expected, FOMC meeting minutes didn't reveal anything particularly new. Weak Q1 GDP was dismissed in favour of strong employment growth. There was some caution regarding inflation by some members but was not a baseline view. The committee also discussed balance sheet reduction which can be seen as a hawkish development. Minutes are basically data two weeks old and the market responded with U.S. dollar selling. It's Fed speakers and how they will shape expectations for a June hike that the market is focused on.

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al_dcdemo 29 May

UPDATE 8: Last week was better for the U.S. dollar as it managed to rise, albeit marginally, against euro, franc, yen, and Australian dollar. Pound sold off after election polls showed PM May lost some support. Canadian dollar capitalized on oil strength, even though OPEC didn't go out on a limb this time around. New Zealand dollar continued its snap-back after bottoming near 0.685. European flash CPI and U.S. NFP report will be two events that the market will closely watch this week. Both have the potential to shape upcoming ECB and Fed decisions.

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al_dcdemo 30 May

UPDATE 9: Commodity currencies are back in favour after some hard time at the start of the month. Loonie and Kiwi both pulled from their cycle-lows while Aussie was bought up ahead of the trendline that connects January and December 2016 lows. A lot depends on the Fed and their tightening pace as BOC, RBA and RBNZ are likely to delay their hikes for as much as possible. Each of the three pairs is trading in a well established consolidaton pattern and it will take either a broad fundamental catalyst or some idiosyncratic risk to break that.

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Kiwi to remain in range for now

al_dcdemo Posted 31 Mar. as Analysis on NZD/USD, Target: 0.7075, Date: 1st of May, 12:00 GMT  in #Technical analysis #Daily Chart #NZD/USD #Rising Channel #Range Trading #Weekly Chart #Technical Tools #Net Short Positioning #Neutral Rbnz
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
Kiwi bottomed in August 2015 and has been mostly contained in a rising channel since then. Just as 50 week SMA crossed above 100 week SMA, the pair …
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al_dcdemo 15 Apr.

UPDATE 5: The U.S. dollar ended the week lower against all major currencies. What we are seeing could be a beginning of a complete reversal of the Trump trade. Expectations of a big fiscal stimulus have been greatly dampened in recent weeks. Inflation and retail sales reports both came weak on Friday. That said, Fed is likely to continue to normalize monetary policy, and it may pay to buy any dollar dip at some later point. Price action in the week ahead could well be dominated by flows ahead of the first round of the French presidental election.

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al_dcdemo 17 Apr.

UPDATE 6: Better than expected Chinese data, that was released overnight, hasn't seen a great deal of impact but it did contribute to a slightly better risk sentiment. Australian and New Zealand dollars remain in a near-term uptrend while yen put in at least a temporary top. A quiet European session is the most likely scenario with main financial centers closed for Easter Monday. Some more activity is possible in N.A. session but many participants will prefer not to involve until tomorrow. That does not rule out a surprise move though.

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al_dcdemo 20 Apr.

UPDATE 7: Kiwi jumped about 40 pips on the release of better than expected quarterly inflation report. CPI (YoY) rose above RBNZ target band mid-point (2.0%) for the first time in five years. The bank previously warned that a rise in inflation could be temporary. The pair is trading near the bottom of the two-year channel. Shorter-term, it looks solid in the upper part of the 0.69 - 0.71 range, which may be extended to the upside in the weeks ahead. 0.7130 (February lows, 200 DMA) looks like a strong resistance. 0.70 is the initial support.

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al_dcdemo 23 Apr.

UPDATE 8: U.S. dollar recorded a mixed last week. It rose against yen, Canadian dollar and Australian dollar but fell against euro, franc, sterling and New Zealand dollar. The moves didn't have a lot to do with the U.S. itself but happened against a backdrop of unwinding of the Trump trade. Focus will be on Europe in the week ahead with French election 1st round results to start with and then ECB meeting on Thursday. Advance version of the U.S. GDP on Friday will be an important data point to watch while BOJ is not likely to stray from its course.

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al_dcdemo 30 Apr.

UPDATE 9: The story from the last week continued this week. The dollar declined against European currencies and appreciated against yen and commodity currencies. Market-friendly result of the first round of the French election didn't impact this dynamic, although better risk sentiment usually means weaker euro and franc, and stronger Aussie and Kiwi. Looking ahead, FOMC meeting may not leave us any wiser next week. After weak U.S. Q1 GDP, NFP report for April seems more important. Of course, all eyes will be on French election polls to see whether Le Pen could gain any ground.

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Kiwi to advance toward 0.75 in the weeks ahead

al_dcdemo Posted 24 Feb. as Analysis on NZD/USD, Target: 0.7375, Date: 3rd of April, 12:00 GMT  in #Technical analysis #Daily Chart #NZD/USD #Rising Channel #Weekly Chart #Technical Tools #Net Long Positioning #Neutral Rbnz #Second Leg
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
Kiwi bottomed in August 2015 and has been mostly contained in a rising channel since then. Just as 50 day SMA crossed above 100 day SMA, the pair br…
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al_dcdemo 11 Mar.

UPDATE 5: U.S. dollar extended its gains this week in most major currency pairs as a rate hike by the Fed and a potentially steeper tightening path is getting discounted. One exception was the euro which gained on the back of constructive tones from the ECB and less chances of Le Pen victory in the French election. Next week's calendar features three central bank meetings (Fed, BOE, SNB), U.S. inflation, Australian jobs and New Zealand GDP. If FOMC fails to hike on Wednesday, the dollar would sell-off hard. To avoid disturbance, a hike is almost a certainty. "Sell the fact" reaction possible.

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al_dcdemo 18 Mar.

UPDATE 6: As widely expected, FOMC hiked federal funds rate corridor by 0.25%. It was a "dovish hike", accompanied by caution on the part of the committee and the governor Janet Yellen. Despite that, the tightening cycle will continue at a gradual pace and market currently expects two more hikes this year. U.S. dollar sold off in response but I don't think the weakness will last. Lower-yielding currencies in particular seem vulnerable as the U.S. dollar bulls will inevitable return. However, the period of exceptionally low global interest rates may be drawing to an end.

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al_dcdemo 25 Mar.

UPDATE 7: The dollar recorded another mixed week. Its losses were most pronounced against lower-yielding currencies while it ended the week higher against the commodity block. In other markets, oil fell as gold rose which may be indicative of traders adjusting for a somewhat weaker recovery and a shallower tightening path. U.S. Administration pulled back from its attempt to repeal Obamacare on Friday and said they will instead focus on tax reform. That adds some uncertainty and, likely, volatility to the quarter-end flow driven week ahead.

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al_dcdemo 28 Mar.

UPDATE 8: Major currencies started the week on a firm footing, particularly against the dollar. The reserve currency fell in response to Obamacare vote failure which means that the Administration will have more difficulties implementing its reforms. Euro trade above 200 DMA yesterday for a couple of hours before pulling back. Yen tested 110 around the same time but it too recovered to be back above 110.5. Pound rose to the highest (1.2615) since early February. More short-covering is expected as Article 50 gets triggered tomorrow. Commodity currencies look soggy.

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al_dcdemo 2 Apr.

UPDATE 9: Correction in the dollar that gained pace after the dovish hike by the Fed appears to have stalled, despite signs that U.S. Administration will have tough time enacting some of its promised reforms. U.S. dollar rose the most against euro and franc but recorded only modest gains compared to yen and antipodean dollars. Pound and Canadian dollar were holding its own, both finishing a tad higher. In the week ahead, FOMC Meeting Minutes may reveal some detail behind the March's decision. Most Fed officials have continued to be hawkish though.

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Kiwi looks poised to visit 0.75 sooner or later

al_dcdemo Posted 26 Jan. as Analysis on NZD/USD, Target: 0.7375, Date: 1st of March, 12:00 GMT  in #Technical analysis #Daily Chart #NZD/USD #Fake Breakout #Rising Channel #Weekly Chart #Technical Tools #Net Short Positioning #Neutral Rbnz
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
Kiwi bottomed in August 2015 and has been mostly contained in a rising channel since then. Just as 50 day SMA crossed above 100 day SMA, the pair br…
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al_dcdemo 9 Feb.

UPDATE 6: The RBNZ left official cash rate at the record low of 1.75%. Rate statement doesn't differ much from the previous one but the bank says that "monetary policy will remain accommodative for a considerable period". Language on exchange rate didn't change but they'd like their currency lower. Kiwi started to fall before the announcement and is currently trading a cent below the pre-announcement levels. 0.72 is the immediate support but 0.71 - 0.7125 band, where 50, 100 and 200 DMA converge, looks like a stronger one. 0.7225 - 0.7250 is the initial resistance.

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al_dcdemo 11 Feb.

UPDATE 7: U.S dollar rose against most of the major currencies last week. It snapped the multi-week decline against euro, franc and New Zealand dollar. Gains were more modest against yen, Canadian dollar and pound. Australian dollar was the only major currency to record a narrow win. Unless Trump starts pushing in the direction of a weak dollar policy, and perhaps even, the dollar should strengthen against low-yielders over the medium term. That said, it will be difficult to meet many market participants' expectations of at least two rate hikes by the Fed this year.

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al_dcdemo 18 Feb.

UPDATE 8: It was another week of relatively tight ranges. With exceptions of yen and maybe pound, major currencies ended the week pretty much where they started. There's still a lot of uncertainty regarding tax cuts and fiscal stimulus in the U.S. but inflation is on the rise and Fed rate hikes are coming. One thing that keeps bulls cautious is Administration's remarks about too strong a dollar and Trump's comments regarding a "level playing field for currencies". The other one is simply expectations of reflation with flows into riskier assets and currencies.

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al_dcdemo 25 Feb.

UPDATE 9: Indecision in the markets continues. Major currencies mostly closed in the middle of their tight ranges. A mild risk-off has been notable with the yen buying gaining traction, in part due to French election hedging. Speculators are building longs in commodity currencies and covering shorts in low-yielders bar the euro. The main event in the week ahead is U.S. president Trump's speech to Congress, in which he is expected to announce his "phenomenal tax plan". Failure to meet market's expectations could see the dollar sell-off.

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al_dcdemo 28 Feb.

UPDATE 10: Major currencies opened the week on a similar note that they ended the last one. The U.S. dollar started on the back foot but stormed back later in the day. Month-end flows and some position-squaring ahead of the important Trump speech tomorrow could be in part responsible for this. Euro, yen, cable and Canadian dollar have seen the most activity while franc and antipodean dollars have traded in tighter ranges. NZD/USD is stabilizing near 0.72, above 50, 100 and 200 DMA. The path of least resistance is to the upside still.

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Kiwi to head lower in January

al_dcdemo Posted 30 Dec. as Analysis on NZD/USD, Target: 0.6825, Date: 1st of February, 12:00 GMT  in #Technical analysis #Daily Chart #NZD/USD #Rising Channel #Weekly Chart #Technical Tools #Balanced Positioning #Neutral Rbnz #U S Election
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
Kiwi bottomed in August 2015 and has been mostly contained in a rising channel. Just as 50 day SMA crossed above 100 day SMA, the pair broke below t…
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al_dcdemo 21 Jan.

UPDATE 5: The U.S. dollar generally moved lower against the major currencies this week. The exceptions were the yen, which was sold on rising U.S. bond yields, and the Canadian dollar which went down on BOC Poloz's remark that a rate cut remains on the table. The best performer was the pound, which rallied after May's soothing rhetoric on what was previously viewed as a "hard" Brexit. Donald Trump officially became the 45th president of the United States on Friday. His first actions will be the market's focus in the week ahead.

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al_dcdemo 23 Jan.

UPDATE 6: Sentiment from the last week continues as U.S. dollar starts the week on the back foot. What started as a normal pullback appears to be morphing into a medium-term correction. Three rate hikes this year, as some Fed officials have been touting, seem a bit far-fetched. I'm thinking two at the most which may be closer to what the majority of market participants expect. Losses against the yen and the pound are the most pronounced today but the dollar has started to claim back some ground it had lost during the Asian session.

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al_dcdemo 28 Jan.

UPDATE 7: It was a lacklustre week for the dollar but the corrective momentum appears to have run out of steam, particularly against the euro, the franc and the yen. Commodity currencies generally performed better but the Australian dollar is finding it diffucult to sustain gains above 0.75. The pound crossed 100 DMA for the first time since the Brexit vote. Next week will be a big one with three central bank meetings (Fed, BOJ, BOE) and plenty of U.S. data, including Nonfarm Payrolls. Trump's actions will remain closely monitored.

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al_dcdemo 30 Jan.

UPDATE 8: U.S. president Donald Trump issued an executive order on immigration late on Friday (early Saturday in Europe). The order led to some chaos in airports in the United States and overseas, and prompted protests and legal action. The dollar gapped lower at the open and continued to trade south in the first part of the Asian session. The impact was most visible in the risk sensitive yen while the antipodean dollars were barely moved due to Chinese Lunar New Year holidays. Cable rose about 60 pips but stalled ahead of the big figure at 1.26.

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al_dcdemo 1 Feb.

UPDATE 9: New Zealand quarterly Employment Change came in as expected, at 0.8%. Unemployment Rate rose to 5.2% on the back of higher Participation Rate (70.5%). Labour Cost Index slightly disappointed at 0.4%. Kiwi added nearly five cents from the low of 0.6860 in late December and pulled back nearly a full cent after the release of otherwise solid labour market data. Profit-taking after yesterday's surge to 0.7350 and ahead of the FOMC might have been a bigger factor.

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