Markets are keenly awaiting the release of US CPI data later today to give some direction to the Forex market, and possibly other asset classes.
Top Regulated Brokers
- The big item in the market today is the release of US CPI data, which is expected to show a lower rate of increase month-on-month, but a higher rate of 4.2% on an annualized basis. Any significant deviation from the expected numbers is highly likely to move markets.
- Another major event will be a policy meeting at the Bank of Canada. The Bank is widely expected to hold its Overnight Rate at 2.25%.
- Less than 48 hours after publicly demanding Israel not to retaliate after an Iranian missile strike on Israeli territory, and despite talking up the imminent prospect of a deal with Iran earlier the very same day, President Trump decided the US must retaliate for the downing of an American army helicopter by the Iranians. It is clear the strikes are relatively limited and were probably facilitated by the Israeli destruction of some of Iran's rebuilt air defenses earlier in the week. Some analysts believe the public fallout between the USA and Israel may have been staged and this was actually a coordinated move. The Iranians have retaliated by firing missiles at US bases in Kuwait, Jordan, and Bahrain. It is not clear what will happen next, the USA/Iran situation is highly fluid and confusing, defying much meaningful analysis.
- The good news for investors at least is that although stock markets are generally a bit lower and seem to have affected by the recent resumption in shooting, the war-driven losses are very small. Markets remain quite calm. Other asset classes are also showing relatively low volatility this week.
- Yesterday morning, US Vice President Vance stated that a deal with Iran is imminent, that it will be a "home run" for the American people, with President Trump saying "total victory" will be declared within two weeks. A few hours later, the USA was bombing Iran. To say that the administration's credibility on the Iran file is being severely strained is an understatement.
- Crude Oil is falling again and did not rise by much when news of the US response came through. It seems clear that markets are treating this as really a symbolic attack in essence and are still expecting some kind of deal.
- After reaching a 1-month high price, the US Dollar Index is falling weakly again ahead of the release of US CPI data today. The USD/JPY currency pair is close to making a new long-term high price and will be closely watched by traders today, as it is inching higher and a strong bullish breakout is a definite possibility.
- Bitcoin is falling again, with the potentially bullish double bottom at $60k which I wrote about yesterday looking very doubtful. This may encourage investors who believe in the long-term future of Bitcoin to be convinced this is the bullish reversal they have been waiting for. I am not convinced.
Ready to trade our daily Market Forex News? Here’s a list of some of the best online forex trading platforms to check out.