- Yesterday saw a firm and fairly strong advance by the US Dollar again almost every other currency, but technical breakdowns were especially notable in the EUR/USD and GBP/USD currency pairs which both reached new multi-year low prices, with the former trading well below its parity level. The US Dollar Index is just a few points off a multi-year high. There is a long-term bullish trend in the US Dollar which can give Forex trend traders a statistical edge if they follow it, as we are likely to see still lower prices in these currency pairs over the coming days.
- Global stock markets have taken a beating over the past day as fearful sentiment grew regarding the Federal Reserve’s monetary policy, although it is worth remembering that the US stock market is in a bear market anyway. The S&P 500 Index and the NASDAQ 100 Index both ended the day down by more than 2%, as did the European DAX. Asian indices also lost ground during the Tokyo session.
- In the Forex market, the Euro and the British Pound are the weakest major currencies, while the US Dollar is the strongest.
- Natural Gas futures rose strongly yesterday to end the day at a new record high. This can also be an interesting trade for trend traders as many brokers offer it as a CFD.
- Manufacturing and Services PMI survey results are expected today for the USA, the UK, Germany, and France.
- Daily new coronavirus cases globally dropped last week for the fifth consecutive week.
- It is estimated that 67.5% of the world’s population has received at least one dose of a coronavirus vaccination, while approximately 7.6% of the global population is confirmed to have contracted the virus at some time, although the true number is highly likely to be much larger.
- Total confirmed new coronavirus cases worldwide stand at over 601.8 million with an average case fatality rate of 1.08%.
- The rate of new coronavirus infections appears to now be most significantly increasing in South Korea, The Marshall Islands, Moldova, and Tonga.
Forex Today: EUR/USD, GBP/USD Hit Multi-Year Low Prices on Fed Fears
By Adam Lemon
Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Money flowed from global stock liquidations into the US Dollar yesterday on fears of a more aggressive monetary policy from the Federal Reserve, with the DXY close to a record high.