All the lower-level US reports scheduled for today have me looking at the US Dollar Index!
Do you think green money will continue to fall compared to its major peers?
Before we move on, ICYMI, yesterday’s watchlist, reviews CAD/JPY for recovery options ahead of CPI launch in Canada. Don’t forget to check if the game is still valid!
And now for the stocks that have rocked the market over the last few trading sessions:
New market titles and economic data:
Inflation in Canada increased faster than expected, hitting a 31-year high of 6.7% in March.
US existing home sales fell 2.7% in March as home prices peak all the time
EIA: US crude inventories dwindle as exports jump to more than 2-year high
Inflation in New Zealand hits 32-year high of 6.9%
Asian stocks fall on fears of slowdown in China, but lower yields limit losses
Gold drops as US bond yields rebound
Upcoming Potential Catalysts in Forex Economic Calendar:
Eurozone CPI final reading at 9:00 GMT
Federal Reserve Manufacturing Index at 12:30 GMT
US initial jobless claims at 12:30 GMT
Eurozone consumer confidence at 14:00 GMT
BOE Governor Bailey will deliver a speech in the District of Columbia at 16:30 GMT
Fed President Powell and ECB President Lagarde will participate in a panel discussion on the Global Economic Debate at 17:00 GMT.
AU and PMI flash production at 23:00 GMT
Japan’s main national consumer price index at 23:30 GMT
PMI for Rapid Production in Japan at 12:30 GMT (22 April)
What to Watch: US Dollar Index
Not many high-profile economic releases are scheduled for the next trading session, but some US economic reports could highlight the dollar.
For example, the Philadelphia manufacturing index is scheduled for 12:30 GMT, the same time as last week’s initial jobless claims.
And then there was the Powell panel discussion at the IMF event in the District of Columbia. While no bombs are expected, the Fed’s tightening plans could take the spotlight and remind retailers that the Fed is one of the most well-coordinated central banks out there.
Will Powell’s US Dollar Index Speech Help Today?
As you can see, DXY has just broken through the trendline support which sellers have been revering since the beginning of the month. More importantly, the last few candlesticks were so bearish that we could see selling continue over the next few hours.
See how the index reacts to the psychological grip of the 100.00 or 99.75 zone, which is a 100% Fibonacci extension of the index’s last major decline.
If the index falls below 100.00 and breaks the previous 99.60 support zone, we could see the dollar lose pips against its higher-yielding peers.
But if DXY sees green sprouts in the next trading session, then the uptrend in the dollar may spread everywhere.