Forex Today: US dollar cheers Asia risk-on, holiday-thinned trading to extend


Easing tensions over the US-China trade dispute boosted the appetite for risk assets across the financial markets in Asia at the start of a brand new week. Across the fx board, the US dollar extended its upsurge and posted fresh five-month highs versus its main competitors.

The Yen emerged the weakest in Asia, having faced double-whammy amid risk-on markets profile. The Kiwi extended loses below the 0.69 handle following New Zealand’s retail sales miss while the Aussie bucked the trend and advanced above 0.7500 levels, tracking higher copper and oil prices. The common currency and pound were sold-off into broad-based US dollar strength while political drama continued to drive the sentiment around both the currencies.

Main topics in Asia

US' Mnuchin, Lighthizer deliver conflicting messages on China - WSJ

As reported by The Wall Street Journal, this weekend saw mixed messages from the US Treasury Secretary Steven Mnuchin and the US Trade Representative Robert Lighthizer regarding the US-China trade standoff.

NZ: Weaker retail spending numbers - Westpac

Satish Ranchhod, Senior Economist at Westpac, explains that it was a soft start to the year for New Zealand’s retail spending as after adjusting for price changes, retail spending was essentially flat over the March quarter.

US fiscal outlook has some alarming points - Goldman Sachs

Goldman Sachs' analysts delivered a weekend note on the United States' fiscal outlook, which carries some worrisome projections looking forward.

US stock futures jump, Nikkei flashes green on easing US-China trade tensions

US stock futures picked up a bid on Monday as China and US agreed to halt imposing punitive import tariffs.

Japan's trade surplus with the US rose 4.7 percent in April

Japan logged a trade surplus of JPY 615.7 billion with the US in April - up 4.7 percent year-on-year as exports rose 4.3 percent year-on-year in April, faster than a 0.2 percent annual increase in March, according to Reuters. 

Venezuela’s Nicolas Maduro wins the presidential election - Bloomberg

Bloomberg is out with the breaking news, citing that Venezuela’s Nicolas Maduro wins the presidential election for another six-year term.

5-Star, League want ECB to forgive €250 billion of Italy debt               

The anti-establishment 5-Star Movement and far-right Northern League plan to ask the European Central Bank (ECB) to forgive €250 billion of Italian debt.

Nicole Sturgeon to "restart" the debate on Scottish independence in the coming weeks

Scotland's Prime Minister Nicola Sturgeon has said she will "restart" the debate on Scottish independence in the coming weeks, according to The Independent. 

Key Focus ahead

Most major European markets remain closed today in observance of Whit Monday, leaving the fx pairs at the mercy of the US dollar dynamics and broader market sentiment. However, the ECB Financial Stability Review and Bundesbank monthly report will offer some trading incentives to the market. The NA session also remains data-quiet, with Canada on Victoria Day holiday while the US docket has nothing to report, except for a slew of speeches by the FOMC members Bostic, Kashkari and Harker.

Also, in focus remains the Oil and Petroleum Exporting Countries’ (OPEC) Joint OPEC-Non-OPEC Ministerial Monitoring Committee (JMMC) meeting, which will be held later on Monday.  

EUR/USD closed below 76.4% Fib despite oversold conditions, focus on Italy

The EUR/USD closed below 1.1790 - 38.2 percent Fibonacci retracement on Friday and dipped to a fresh four-month low of 1.1744, despite the oversold conditions as shown by the RSI.

GBP/USD stumbles below 1.3450, Sterling bulls on the back foot ahead of Wednesday's inflation hearing

The week is starting off on a quiet note for the Sterling, although Wednesday will be bringing Inflation Report Hearings at 08:00 GMT, followed by Retail Sales on Thursday. 

A test of the breakouts

This week should be all about contesting and consolidating last week’s significant breakouts in 10 year UST, EURUSD, USDJPY and Oil Prices.

The week ahead data preview: eyes on FOMC minutes - Nomura

Analysts at Nomura explained their outlook for the week's key events coming up.

GMT
Event
Vol.
Actual
Consensus
Previous
Wednesday, May 16
24h
 
 
Monday, May 21
24h
 
 
24h
 
 
24h
 
 
08:00
 
 
n/a
 
 
n/a
 
 
12:30
 
0.14
0.10
15:30
 
 
1.89%
15:30
 
 
2.035%
16:15
 
 
18:05
 
 
21:30
 
 
Tuesday, May 22
08:30
 
£7.301B
£-0.262B
09:00
 
 
12:30
 
0.7%
-0.8%
12:55
 
 
4.9%
12:55
 
 
0.8%
14:00
 
 
-3
15:30
 
 
2.2%
15:30
 
 
1.655%
17:00
 
 
2.498%
20:30
 
 
4.854M
Wednesday, May 23
00:30
 
53.3
53.8
01:30
 
1.0%
-19.4%
04:30
 
0.1%
0.4%
06:00
 
 
2.3%
06:00
 
0.3%
0.3%
06:00
 
 
1.6%

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

AUD/USD: Bulls continue to target 0.6300

AUD/USD: Bulls continue to target 0.6300

AUD/USD traded in a tight range and faltered once again just ahead of the key 0.6300 hurdle on the back of the renewed buying interest in the US Dollar and the widespread knee-jerk in the risk complex.

AUD/USD News
EUR/USD: Further gains look at 1.0600 and above

EUR/USD: Further gains look at 1.0600 and above

The weekly recovery in EUR/USD gave signs of some loss of momentum despite the pair hit new three-week highs around 1.0460 in a context dominated by the resurgence of the bid bias around the Greenback.

EUR/USD News
Gold remains on track to challenge record peaks

Gold remains on track to challenge record peaks

Gold price sticks to positive bias for the third successive day on Wednesday and trades near its highest level since November 1 above $2,750. The uncertainty around US President Donald Trump's trade policies turns out to be a key factor that continues to drive haven flows towards the precious metal.

Gold News
Dogecoin Price Prediction: Bulls target $0.40 rally as Trump officially launches Elon Musk’s DOGE

Dogecoin Price Prediction: Bulls target $0.40 rally as Trump officially launches Elon Musk’s DOGE

Dogecoin price rose 5% on Wednesday to reclaim $0.38 as Donald Trump signed the DOGE department into law. Media reports linking the Dogecoin logo to the official DOGE website sparked bullish speculations that a $0.50 breakout could be imminent. 

Read more
Netflix posts record quarter, as Trump talks tariffs on China

Netflix posts record quarter, as Trump talks tariffs on China

There has been a positive tone to risk this week, as the market digests Trump 2.0. However, Trump is not the only show in town. Earnings reports are also a key driver of stock indices, and the news is good.

Read more
Trusted Broker Reviews for Smarter Trading

Trusted Broker Reviews for Smarter Trading

VERIFIED Discover in-depth reviews of reliable brokers. Compare features like spreads, leverage, and platforms. Find the perfect fit for your trading style, from CFDs to Forex pairs like EUR/USD and Gold.

Read More

Forex MAJORS

Cryptocurrencies

Signatures