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It was a quiet session as market tones were mostly muted, awaiting key central bank decisions later this week.
Major currencies did not get up to much whatsoever, with the dollar holding steady amid more muted action. The ranges for the day are leaving a lot to be desired, so there isn’t much to really scrutinise in the FX space.
EUR/USD is holding near 1.0900 with large option expiries in play at the figure level while USD/JPY is flat just above the 149.00 mark, not finding much appetite before the BOJ tomorrow.
The lack of meaningful action in Treasuries is also keeping currencies less enthused so far on the day.
The only notable mover is in equities as tech shares are soaring ahead of the US open later. Nvidia is holding its annual GTC Conference today and that will be one to watch. S&P 500 futures are now up 0.7% as investors are putting behind last week’s drop quite quickly.
But for the rest of the week, it’s all about the major central bank decisions to set the mood in broader markets.
This article was written by Justin Low at www.forexlive.com.
S&P 500 futures are now up 0.5% on the day with Nasdaq futures seen up 1.0% ahead of US trading later. Tech shares are the ones on the move as Dow futures are still seen rather flattish at the moment. Meanwhile, European indices are still just slightly higher so far on the session.
Nvidia remains the focus as it is set to open above $900 as indicated in pre-market trading. The company will be hosting its first in-person conference this week since the pandemic. And plenty of watchful eyes will be on that.
The move here is the standout as there hasn’t been much else happening during the session. Major currencies remain largely muted and little changed while Treasury yields are also not giving much to work with for now.
This article was written by Justin Low at www.forexlive.com.
Dow Jones Technical
Analysis – Daily Timeframe
On the daily chart, we can see that the Dow Jones broke
out of the rising wedge recently
and started to consolidate just beneath the bottom trendline. The
breakout opened the door for a bigger correction into the 38043 level, but the
strong battle between buyers and sellers led to a rangebound price action ahead
of the FOMC rate decision. There are no catalysts now trading into the event,
so the technicals will likely lead the price action.
Dow Jones Technical
Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that
the price managed to break above the downward trendline but got smacked back
down following some strong US data that raised the risk of a hawkish Fed on Wednesday.
We now have a range between the 38461 support and
the 39119 resistance, so the market participants will likely “play the range”
by buying at support and selling at resistance until we get a breakout.
Dow Jones Technical
Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more
closely the recent rangebound price action. If the dip-buyers come into the
market strongly, then a break above the recent swing high at 38930 could lead
to a break above the 39119 resistance, although it might be better to wait for
the FOMC before taking new trades.
Upcoming Events
This week we have the FOMC rate decision on Wednesday
where the Fed is expected to keep rates unchanged. The market will be on the
lookout for hawkish surprises though following the stronger than expected
inflation data. On Thursday, we conclude with the latest US PMIs and Jobless
Claims figures.
This article was written by FL Contributors at www.forexlive.com.