Home Forex Forex Market Analysis Daily market update: Trump politics affect the dollar, BoJ may change its...

Daily market update: Trump politics affect the dollar, BoJ may change its policy

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news commentary


 

The dollar continued lower today after US President Trump made comments on Friday about critical of Federal Reserve monetary policy. US presidents traditionally do not comment on moves by the Fed, but that did not prevent Trump from tweeting on Thursday that “tightening now hurts all that we have done.”

This made investors hold their long positions for the dollar as it’s also followed by Trump attack to the EU and China for manipulating their currencies and holding interest rates lower. This has raised concerns that the current global trade war could be followed by a currency war.

Concerns about geopolitics returned again after U.S. President warned Iranian President Hassan Rouhani in a late Sunday evening post on Twitter to “never ever threaten” the U.S. again or else “suffer consequences”.

The tweet came hours after Rouhani told Trump that hostile policies toward Tehran could lead to “the mother of all wars.”

 

On the other hand, there’re reports claim that the bank of Japan was weighing moves to scale back its large monetary stimulus ignited a short rally in the Japanese currency.

The Bank of Japan facing very low inflation, is in active discussions with changes to its interest-rate targets and stock-buying techniques. Expectations the central bank may uncover some measures at its next monetary policy meeting on July 30 and 31 sent bond yields and the yen rallying

 


chart analysis


 

 

US INDEX

On the daily chart, the price has bounced from the red resistance zone for the third time to shape the reversal triple top.

Price has recently formed another reversal pattern to assure the bearish bias with the wedge.

Followed by a break beneath an ascending trend on RSI, the index is settled down at the ascending trend line,  it’s broken, the price will have its way back to the support zone 93.2-92.6


 

 

AUD/USD

On the daily chart, the pair reached back the green support zone again to shape a double top pattern

Followed by divergence on RSI, our bullish view is still the same: if the price manages to still above the support area and the key level 0.7455, it will be heading towards the combination of levels of descending trend, ascending channel and resistance zone at 0.7655-0.774.


 

 

NZD/USD

On the daily chart, the price retested the green support zone 0.675-0.6695, followed by divergence in RSI.

An AB=CD harmonic pattern has been shaped to reinforce the bounce.

If the price could break above the key level at 0.6845, the price will be supposed to head back to the top of the descending channel with the resistance zone at 0.697-0.703 only if it manages to hold above the green zone


 

 

AUD/JPY

On the daily chart, as we expected, the price has bounced from the red resistance zone at 83.9-85.95 with engulfing bar

The price is expected to continue its reverse to keep going in its sideways movement to the support zone 81.2-80.5


 

 

CHF/JPY

On the daily chart, as we expected, the price has bounced according to the key levels that the price has recently reached the resistance zone at 112.85-113.05, reversal wedge, moving average 200 and 50% Fibonacci.

Followed by AB=CD harmonic pattern, if the price could break beneath the key level 111.9, the price will be expected to go down to 111.9 then 110.3


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