Yields Approaching 3% Are Good News for Dollar Bulls
The greenback set a three-month high Monday as 10-year yields rose to within a whisker of 3 percent, a key mark that some observers see as potentially opening the door to much higher levels. The two markets are moving more in sync after the relationship cooled for a spell: The 60-day correlation between the Bloomberg Dollar Spot Index and 10-year yields has turned positive, after dipping into negative territory in recent months for the first time since 2016. Read More @ https://www.bloomberg.com//news/articles/2018-04-23/dollar-bulls-catch-a-wave-as-3-watch-revives-yield-correlation
AUD IN TROUBLE?
The Australian dollar is getting dumped, falling to the lowest level seen this year
- The Australian dollar remains under pressures against the greenback, falling to its lowest level since December 2017.
- Higher US bond yields continue to support the greenback.
- Australia’s March quarter CPI report will be released today. Read more @ https://www.businessinsider.com.au/aud-australia-dollar-us-bond-yields-inflation-2018-4
Yen Drop Buoys Japan Stocks as Dollar Holds Gain: Markets Wrap
A weaker yen supported Japanese equities at the start of Tuesday trading after the dollar climbed while investors maintained focus on the U.S. Treasury market, where the 10-year note flirted with 3 percent. Read More @ https://www.bloomberg.com//news/articles/2018-04-23/yen-drop-to-buoy-japan-stocks-as-dollar-rallies-markets-wrap
TIME TO BUY JPY? BUT WAIT FOR THE TECHNICAL SET-UPS STARTS
Japan will reach 2% inflation target and can begin reducing stimulus in five years, BOJ’s Kuroda says
- “Sometime within the next five years, we will reach [our] 2 percent inflation target,” Governor Haruhiko Kuroda told CNBC’s Sara Eisen over the weekend.
- Once that level is reached, we will start “discussing how to gradually normalize the monetary condition,” Kuroda said.
- However, protectionism, unexpected rapid tightening of monetary policy in some countries, and geopolitical tensions in North Korea and the Middle East pose potential risks to global growth, Kuroda said. Read More @ https://www.cnbc.com/2018/04/23/bojs-kuroda-japan-will-reach-2-percent-inflation-target.html
WHAT IS THE USD INDEX SAYING?
Range bound still @ $90.50 – $91; but the USD might head to $92 be cautious if you are shorting USD.
NEWS THAT MGHT AFFECT YOUR TECHNICAL TRADES TODAY.
- 9.30am – Australia will release their economic leading indicator the CPI which is expected to be lower then previous month – we believe the CPI will remain the same.
- 1.00pm – Japan will release the CPI which is an important economic data for stimulus cut decision – we believe Japan is now ready for a QQQE CUT sooner then many think. We maintain BUY for JPY.
- 4.00pm – German Business Climate will create volatility – we maintain BUY EURO this year – we will catch all lower prices and do a Dollar Cost Averaging (DCA Technique); we never want to miss the rally this year.
- 10.00pm – US will release their New Home Sales and is expected to be higher then previous month; USD expected to go up tonight. $91 focus.
We remain cautious this week as the US Treasury yield for the first time after 2016 breaks the 3% and looks like corporate companies are supporting the USD as it almost breaks the $88. USD rally will not long we believe the SELL-OFF is around the corner, be cautious this week with good money management.
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