A busy week is ahead of us. Our guest blogger Matthew Clark gathered here what to expect and what to focus on in relation to the EUR/USD.
This article is written by Matthew Clark who is the owner of Global Forex Pros.
ABOUT THE AUTHOR: Matthew has been a trader for more than 20 years, running FX Desks at major banks and retail brokers. He recently started Global Forex Pros as a service for brokers to offer their clients, teaching them to trade in real-time as professional traders learn at banks and institutions, giving the retail trader the confidence to trade and increasing volumes for the broker.
Washington Irving said "The Almighty Dollar, that great object of universal devotion throughout our land." With four central bank rate announcements and non-farm payrolls this week, will traders remain devoted to the dollar?
The dollar finished the month higher against the euro completing eight up-months in a row and, with the greenback printing gains against the yen and the Swiss franc, the dollar index is back up testing multi-week highs.
Given the recent bearish news out of the states this week including Friday's Chicago PMI and pending home sales, where will the dollar go over the next few weeks? The revision to lower personal consumption along with Janet Yellen's less-than-enthusiastic semi annual testimony confirming for the market that patience will remain for the next few months (with the Fed more focused on the actual data before any rate rise), it was a surprise to see the dollar strengthen towards the end of the week.
With that in mind, and looking at the price action, it may be that we can see some final gains for the dollar. Bearing in mind the strength of the dollar, as can been see in the chart of the dollar index below, we have been expecting a multi-week/month reversal. Any new highs for the dollar, especially against the euro, should be short lived.
EUR/USD broke below the 1.1260/70 floor that had held all month, triggering stops and pushing us down to close the week with a loss for the second week in a row. This has switched our view on both technical and fundamental factors to bearish in the short term as we look for one new low in the euro and a high in the dollar index. However, there is a tremendous amount of event risk over the next five days; With four central banks (ECB, RBA, BOC and BOE) the focus will remain on monetary policy divergence with the dollar.
With the lows at 1.1097 still in place we cannot dismiss the possibility that we have seen the low and, on a risk-reward basis, it is not a bad trade to buy it now with a stop below. But with the Greece risk at least postponed for a few months the underlying strength of the dollar may see the tone reasserting itself. Although no changes are expected from Super Mario Draghi this week the details on the quantitative easing program announced last month will be released. With the ECB committed to buying 60 billion Euros each month it may struggle to find enough quality bonds to buy, putting pressure on the whole program and, as such, the euro.
On a purely technical basis the break below 1.1260 completed a wave-4 triangle for a final push lower in the days ahead in a 5-wave decline to new lows around the 1.0750-1.0800 level. We can see clearly that the euro has sold off in this short term chart in five waves, signalling a turn lower has occurred, in either a wave-1 of 5 or as a more complicated correction wave (a). But it does set up in both cases a corrective rally in three waves in the coming days, with the targets for the end of the recovery at 1.1257 (the 38.2%) and the 61.8% retracement at 1.1307. With the market expecting no changes from any of the central banks, Mr Draghi's press conference will be watched avidly by traders looking for some clue for the euro. With the EUR/USD still oversold on a weekly basis and the huge speculative positions still being held we simply cannot rule out a final push lower with Mario failing to excite the markets on Thursday. Only a move back above 1.1400 would negate the bearish view on the euro.
This article is part of the Forex Magnates Community project. If you wish to become a guest contributor, please apply here: UGC Form.
This article is written by Matthew Clark who is the owner of Global Forex Pros.
ABOUT THE AUTHOR: Matthew has been a trader for more than 20 years, running FX Desks at major banks and retail brokers. He recently started Global Forex Pros as a service for brokers to offer their clients, teaching them to trade in real-time as professional traders learn at banks and institutions, giving the retail trader the confidence to trade and increasing volumes for the broker.
Washington Irving said "The Almighty Dollar, that great object of universal devotion throughout our land." With four central bank rate announcements and non-farm payrolls this week, will traders remain devoted to the dollar?
The dollar finished the month higher against the euro completing eight up-months in a row and, with the greenback printing gains against the yen and the Swiss franc, the dollar index is back up testing multi-week highs.
Given the recent bearish news out of the states this week including Friday's Chicago PMI and pending home sales, where will the dollar go over the next few weeks? The revision to lower personal consumption along with Janet Yellen's less-than-enthusiastic semi annual testimony confirming for the market that patience will remain for the next few months (with the Fed more focused on the actual data before any rate rise), it was a surprise to see the dollar strengthen towards the end of the week.
With that in mind, and looking at the price action, it may be that we can see some final gains for the dollar. Bearing in mind the strength of the dollar, as can been see in the chart of the dollar index below, we have been expecting a multi-week/month reversal. Any new highs for the dollar, especially against the euro, should be short lived.
EUR/USD broke below the 1.1260/70 floor that had held all month, triggering stops and pushing us down to close the week with a loss for the second week in a row. This has switched our view on both technical and fundamental factors to bearish in the short term as we look for one new low in the euro and a high in the dollar index. However, there is a tremendous amount of event risk over the next five days; With four central banks (ECB, RBA, BOC and BOE) the focus will remain on monetary policy divergence with the dollar.
With the lows at 1.1097 still in place we cannot dismiss the possibility that we have seen the low and, on a risk-reward basis, it is not a bad trade to buy it now with a stop below. But with the Greece risk at least postponed for a few months the underlying strength of the dollar may see the tone reasserting itself. Although no changes are expected from Super Mario Draghi this week the details on the quantitative easing program announced last month will be released. With the ECB committed to buying 60 billion Euros each month it may struggle to find enough quality bonds to buy, putting pressure on the whole program and, as such, the euro.
On a purely technical basis the break below 1.1260 completed a wave-4 triangle for a final push lower in the days ahead in a 5-wave decline to new lows around the 1.0750-1.0800 level. We can see clearly that the euro has sold off in this short term chart in five waves, signalling a turn lower has occurred, in either a wave-1 of 5 or as a more complicated correction wave (a). But it does set up in both cases a corrective rally in three waves in the coming days, with the targets for the end of the recovery at 1.1257 (the 38.2%) and the 61.8% retracement at 1.1307. With the market expecting no changes from any of the central banks, Mr Draghi's press conference will be watched avidly by traders looking for some clue for the euro. With the EUR/USD still oversold on a weekly basis and the huge speculative positions still being held we simply cannot rule out a final push lower with Mario failing to excite the markets on Thursday. Only a move back above 1.1400 would negate the bearish view on the euro.
This article is part of the Forex Magnates Community project. If you wish to become a guest contributor, please apply here: UGC Form.
This article is written by Matthew Clark who is the owner of
Global Forex Pros.
ABOUT THE AUTHOR: Matthew has been a trader for more than 20 years running FX desks at major banks and retail brokers. He recently started Global Forex Pros as a service for brokers to offer their clients, teaching them to trade in real time as professional traders learn at banks and institutions, giving the retail trader the confidence to trade and increasing volumes for the broker. Matthew has been a trader for more than 20 years running FX desks at major banks and retail brokers. He recently started Global Forex Pros as a service for brokers to offer their clients, teaching them to trade in real-time as professional traders learn at banks and institutions, giving the retail trader the confidence to trade and increasing volumes for the broker.
Devexperts Checks Off Type 2 SOC 2 Audit for Enhanced Data Security
Network, Learn, Grow | FMAS:24
Network, Learn, Grow | FMAS:24
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
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Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
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Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
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Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
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Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
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Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
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Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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