FX168 Financial News (Hong Kong) News Super "Nuclear Explosion" Week: Federal Reserve May interest rate decision, US April non-farm employment report, US "four big hawks" to China to negotiate trade, US President Trump (Donald Trump) The temporary exemption period for steel and aluminum tariffs enters the last 24 hours... Tonight, the global market will welcome two “nuclear bombsâ€: the Fed’s favored inflation indicator – the core PCE price index, and Trump’s temporary tariff exemption period for steel and aluminum tariffs the final Countdown!
just! The dollar has risen again: the euro fell below 1.21, and the price of gold approached the 200-day moving average
On Monday (April 30), the US dollar rallied again, and the highest climbed to 91.76; the euro/dollar fell below 1.21, the lowest fell to 1.2097; the pound/dollar fell to 1.3728; the spot gold recorded the lowest at $1315.65. /ounce……
Technically, the daily chart shows that the US dollar index was blocked at 92.00 on the channel upper rail and the 200-day moving average last Friday, and rebounded from the support at 91.50. In the short-term, continue to pay attention to whether it can break through the resistance of 92.
The article also pointed out that if the dollar can break through, it will open up further upside potential to point to potential resistance at 92.60. If it falls back, the initial support is still 91.50, and the next concern is 91.30.
"The dollar may rise further this week, because given its countercyclical nature, the loss of momentum in the world economy is supporting the dollar," Joseph Capurso, senior currency analyst at Commonwealth Bank of Australia, wrote in a report.
It also pointed out that “the economic data of the Eurozone and the UK are disappointing, and the US economic data is beyond expectations!†This week, in addition to the non-farm payrolls report, the US will also announce CPI, PCE, ISM services and manufacturing PMI. wait wait wait……
Last week, the US dollar index not only broke through the important resistance since January this year, but also broke the downward trend line since the beginning of 2017, or marked the turning point of the weak dollar of the US dollar in the past year.
In addition to FOMC interest rate resolutions and non-agricultural reports, as well as important data such as CPI and ISM manufacturing and service industry PMI, the US dollar will face guidance on these events and data. Considering that the market has turned from a very bearish to a bullish one, the dollar may be further boosted.
In addition, last week FX168 financial network wrote that the rebound of the US dollar, in addition to the US bond yields, strong economic data, there is an important factor is the impact of the position!
According to the data, speculative customers in the Chicago exchange rate futures market have hit a six-and-a-half-year high, suggesting that there may be some short-covering soon.
According to the latest data, according to Bloomberg's Commodity Futures Trading Commission data, as of April 24, the net short position of leveraged funds fell to its lowest level since January. This threatens that the shorts are being replenished, and the market is expected to continue...
"Previously, US interest rates were not important to the US dollar exchange rate, and now it has become important, and our stock market situation shows that the US dollar has more short covering space," said Michael Sneyd, head of global foreign exchange strategy at BNP Paribas in London.
As the dollar continued to soar, the currencies with the largest net long positions against the dollar also fell the most. EUR/USD, and GBP/USD have been hit hard... Today, the euro fell below 1.21, and the pound renewed its low of 1.3728 on March 1.
Regarding the euro: the euro/dollar fell again, the lowest fell to 1.2097, and the support looked at 1.2056. From a technical point of view, once broken, the 200-day moving average of 1.2050 will continue to face threats, and the next break may further test the integer number 1.2000.
About the pound: Last Friday, the exchange rate fell sharply and has already fallen below the 100-day moving average support. For the first time since mid-November, it is opening up short-term further downside. Today, the pound/dollar fell to a minimum of 1.3728, supported at 1.3712...
A break below the 1.3710 at the end of March will confirm further declines. The exchange rate will test the previous year's uptrend line below the support of 1.3600. The resistance is at 1.3800. If it breaks, it will test the 100-day moving average and is located near 1.3870.
About gold: At the moment, the price of gold is supported on the lower rail of the triangle (now at 1316.00). If the gold price breaks the support, it will open the downside to the interval 1307.63 (bottom of the consolidation range) -1308.65 (23.6% Fibonacci extension).
From a technical point of view, once the gold price breaks below 1308, it will open up further downside.
In the news, tonight will usher in the US March PCE data (the Fed's favored inflation indicator), the market is expected to record 1.9%, if it meets expectations, it will hit a 13-month high, and the signal that US inflation will rise steadily will also strengthen The Fed raises interest rates.
the final Countdown! Trump will detonate this "nuclear bomb"
In addition to the US economic data, there is a "nuclear bomb" tonight: US President Donald Trump's temporary tariff exemption for steel and aluminum tariffs will end in the early morning of May 1 local time (noon on May 1, Beijing time) !
A month ago, the United States decided to impose 25% and 10% tariffs on imported steel and aluminum, respectively, but the EU, Canada, Mexico, Argentina, Brazil, Australia, South Korea and other allies have been temporarily exempted. This exemption period will end on May 1.
Analysts pointed out that if Trump continues to levy taxes, this move will inevitably trigger a global trade war, and financial markets will also be affected! Fortunately, Trump still has the last 24 hours...
According to Axios, senior officials responsible for free trade, such as US Treasury Secretary Mnuchin and White House chief economic adviser Kudlow, hope to extend the exemption period, provide more time for negotiations, and prevent panic in US stocks and global stock markets.
However, the hard-line US trade adviser Navarro still holds high the tariff banner and firmly believes that "President Trump is defending the interests of the American people." Since the final decision still falls in the hands of Trump, the White House's approach is not clear.
In addition, according to a recent report by Bloomberg, the Trump administration insisted that Canada and European countries agree to import quotas in exchange for temporary exemptions for steel and aluminum tariffs to be implemented from May 1.
The EU said that after the United States refused the EU's unconditional abandonment of metal import tariffs, the EU is preparing for the upcoming trade war.
US Secretary of Commerce Ross said: "We ask everyone to either agree to the tariff or agree to the quota." Bloomberg believes that the EU is faced with the choice: either to concede to the United States or face new "punishment" tariffs.
US Commerce Secretary Ross said that the United States will exempt some of its allies from metal tariffs, but not all allies; the list of countries that will be exempted in the future will be announced before the deadline for metal tariff exemptions.
Ross said on Friday that the United States is seeking to implement steel trade quotas for other countries; the United States said to all parties that if they do not want to be imposed on tariffs, they must implement a quota system.
According to EU sources, the United States has requested that steel and aluminum exports be reduced to 90% of the level in the past two years. Europe considers this requirement unacceptable.
The EU has made it clear that it will not be intimidated. French President Mark Long said this month, "When someone points a gun at our head, we will give up any negotiations."
German Chancellor Angela Merkel held talks with US President Trump at the White House last Friday. After the meeting, she said that she discussed the trade dispute with Trump, but failed to get the US commitment to stop collecting tariffs.
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