FX Trade Journal

Fundamentally the Dollar is set to rally to 12,240 - 12,250 following an upward revision in 1st quarter GDP data and the build-up to the June FOMC meeting in which the Fed is expected to raise rates by 25bp in line with the three rate hike forecast since December. The final hurdle to cross is the June NFP due this coming Friday - in which only a strongly disappointing report can derail this plan. Strongly disappointing in this context would have to show less than March job growth, with its low number of 98k. Inflation remains on course according to the Fed, and fears that they are falling behind the curve will sustain pressure on the FOMC to hike the Fed Funds rate. Technically the FXCM USDOLLAR has been locked in a falling wedge pattern since December and the reversal from Mondays low has reconfirmed the lower trendline. As the falling wedge approaches narrowing convergence; the FXCM USDOLLAR is facing an imminent breakout during the second quarter - with fundamentals poi...

US Labor data showing signs of improvement in terms of wage growth and a low unemployment rate following the seasonal factors that caused weak labor data in the first quarter. As this upbeat data factors into retail spending and investments the greenback will find support especially with an anticipated rate hike in June. Key support anticipated at 12,050 - 12,150 levels.

Softer consumer data from the US will sustain selling pressure on the greenback leading into April. From there-on the next rate hike, possibly in June will provide support for the Greenback. Soft support level at 12,250 with key support at 12,150 - 12,200 level.

Friday's NFP release did very little to slow the current US Dollar correction that is set to spill over into Monday before the upcoming FOMC meeting. Although recent commentary from Fed officials have indicated that it is probable for the Fed to raise rates in the March meeting, the risk still prevails that they may postpone the rate rise at this stage. Accordingly, three possible scenarios exist for the US Dollar this week; and the Fed's DotPlot will be closely observed for clues. 1) The Fed does not raise rates which will cause a Dollar sell-off. Key support levels in this scenario is 12,250 and then 12,100. 2) The Fed raises rates and indicates that it will raise rates two more times in 2017. Key resistance level in this scenario is 12,650. This scenario is most probable according to market expectations. 3) The Fed raises rates and indicates that it will raise rates three more times in 2017. Key resistance level in this scenario is 12,750 - 12,800.

As certainty about the details of Trump's Fiscal Policy emerge the Greenback is set for a correction to the upside, however cyclical factors will see the Greenback extend to the downside. Upcoming key support levels at 12,100 and then 12,000

Exciting times await as the US Dollar rallied into 14-year highs as US Treasury yields rallied and the Dow Jones hit all-time highs following the most recent Fed DotPlot that charted a three-quarter rate hike during 2017, supported by evidence of Economic recovery accelerating in the US amidst strong GDP growth in the last quarter of 2016, strong job creation with unemployment dropping to a low of 4.6% and the outlook that Trumpenomics is about to spur on inflation when Trump takes office. Slipping by unnoticedly however is weak wage growth and bearish momentum in consumer spending habits and capacity utilization which will likely dampen the outlook from a three-quarter rate hike to a two-quarter rate hike during 2017, and as result the premium US Dollar stands to be corrected by at least 200 points as the market starts realizing the over pricing of the US Dollar. This is not the only risk factor when it comes to the pricing of the US Dollar to watch as free trade agreement ...

  US Dollar Rally set to extend to 12,550 - 12,600 level as the market prices in 100% chance of Rate Hike in December amidst continuation of strong US fundamentals; ADP NFP @ 216K, GDP revised to 3.2%, lowest levels of Unemployment Claims. Expect upcoming NFP to beat expectations!

Strong US fundamentals post strong retail sales report keep supporting an upcoming rate hike and as US Treasury bonds keep selling off the US Dollar which has already tested its yearly high will likely rally to the upside and form new highs. Key resistance levels to be expected at 12,400 12,500 and 12,600 levels

With election volatility settling, the dollar is set to continue its advance to test and break the yearly high on the outlook of a December rate hike after jobless initial and continuing claims steadily continue to decline, providing evidence of strong overall jobs growth and a strong performing economy.

Expecting a mildly surprising NFP report forecasted at 185K, stronger than the general consensus, which will boost the dollar for now, but as election uncertainty looms, a period of consolidation is expected.

The Federal Reserve bases interest rate decisions on jobs data, and thus far jobs data has painted a picture of a strong United States economy as job openings and the employment rate increases to 5 year highs. As we move closer to December the eventuality of an interest rate hike becomes more likely. The strong growth in jobs will manifest itself in the 2016 3Q-GDP data release tomorrow, and the growth thereof may likely surprise and beat expectations. Overall the dollar rally is set to extend to the 12,300 level which is the yearly high of FXCM’s Dollar Index and may even break this high and push new resistance to the 12,500 level.   

USD Even with the disappointing unemployment claims release today, the overall trend of initial unemployment claims is on a downwards trend which supports continuous jobs creation and thus the case of a rate hike by the Fed in December. The dollar rally is likely set to retest the yearly high at 12,300. AUD/USD With an upcoming dollar rally and a net loss of jobs in Australia the Aussie-Dollar is set for a sell-off to the 0.7500 support level. Trade: Entry to sell @ 0.7660 with T/P @ 0.7510 and S/L @ 0.7710 NZD/USD Being highly correlated to the Aussie Dollar, the Kiwi-Dollar is set for a sell off to the 0.7100 support level. Trade: Entry to sell @ 0.7200 with T/P at 0.7105 and S/L @ 0.7235 USD/CAD With no upcoming CAD data, along with Dollar strength the USD/CAD pair is likely to rally to the 1.3300 resistance level, however, strong CAD employment data will continue to weigh in on this pair and a sell-off is to be expected from the...

USD Supported by decreasing Jobless claims which currently is at a decade low, the USD is set to test its yearly high at 12,306 (FXCM Dollar Index) on an outlook of an interest rate hike by a hawkish Federal Reserve this coming December; and even though consumer sentiment and retail sales may have disappointed dollar bulls, these reports will at best only offer a retrace in the Dollar Index to the 12,050 level. AUD/USD With a Hawkish outlook on the FED in December, the disappointing Consumer Sentiment will at best provide a short lived rally to 0.7640 until the bears take control pushing this pair down to its 89-EMA. Trade: Entry to Buy @ 0.7610 with T/P @ 0.7640 and S/L @ 0.7595 NZD/USD With continued dollar strength and the Kiwi’s weakness on the decline of the dairy auction price, the pair on the weak consumer sentiment data may offer a retracement to the 0.7200 level before commencing the sell-off to test the 0.7000 psychological support level. Tr...

USD Continued hawkish sentiment from the Federal Reserve favours a stronger greenback. This sentiment may be provided by the fact that the Quarterly Senior Loan Officer Opinion survey observed an increased demand for loans during the second quarter of 2016 and the most recent poll indicates that there was little change to this fact going into the third quarter.  Weaker than expected NFP’s was not enough to curb the ongoing dollar rally and offers a timid correction that may provide the ideal opportunity to buy dollars on weakness. Technically a pull-back to the 12 060 level before the dollar rally continues as the 8-EMA bounces of the 21-MA as seen on the following 4-Hour chart (FXCM Dollar Index) . The dollar rally is likely to continue up to the upcoming elections in November. AUD/USD With unchanged rates by the Reserve Bank of Australia, positive Australian economic sentiment of increased retail sales and increased exports from the past week ...