US Market Wrap

Yesterday in the US, the focus was squarely on the FOMC and what they had in mind for monetary policy going forward.

Jerome Powell and his men have been on an easing binge this year, with three straight interest rate cuts, boosting both the economy and the SPX. Many had been expecting rates to work their way higher just as quickly as the economy has really stabilised in the latter half of 2019. However, it looks like the Fed has other ideas.

Their dot plot, which gives an indication of future rate hikes, make it seem like there will not be any hikes in 2020 and perhaps only one in 2021. Of course, this can change, but for now, the hawks must temper their expectations. As a result, we saw USD weakness as it appears Powell and co. are happy to wait for ‘significant and persistent’ inflation before acting.

Today’s Agenda

The week looks like it is about to heat up today, as much of the attention turns back to the UK as they conduct their general election.

There will be far more at stake than simply which party forms Government, as markets are more interested in a Brexit outcome. Incumbent Johnson is pro-Brexit and is looking to make a deal after numerous failed attempts.

Brexit has already claimed multiple scalps including his predecessor Teressa May, so we must be prepared for anything and the GBP/USD could see wild swings on rumour and speculation late in the session.

Today will also feature the ECB interest rate decision and will be the first chance for Christine Lagarde to stamp her authority as leader. While we don’t expect much, her views and outlook will likely move the EUR/USD.

Finally, there is also the SNB decision. But with everything else going on today, that is very likely to be overshadowed.

Forex Signal Update

The FX Leaders Team finished with 1 win from 1 signal as we continue to build into the week.

Gold – Pending Signal

GOLD saw some upside yesterday as the USD weakened with a bit of a dovish outlook ahead. With the FED still waiting on inflation, the yellow metal might be looking at a period of consolidation. That said, there is plenty of support for a long signal at the moment.

USD/JPY – Pending Signal

The USD/JPY is still holding right above the key 108.50 level. This could be a great spot to buy, but if that level falls, keep your stop tight.

Cryptocurrency Update

BTC continues to get stair-stepped lower and is fast closing in on the $7,000 level.

There’s really not a great deal for us to update here currently. The real plays we are looking at are that breakdown of $7,000, or a squeeze higher through $7,600.

I’m biased to the downside here and will be expecting that test of support in the coming days.