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

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.

  1. 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.
  2. 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.
  3. 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.
  4. 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.

High Risk Investment Warning:

Please note that Forex and other leveraged trading involves significant risk of loss, It is not suitable for all traders and you should make sure you understand the risks involved, it is recommended that you seek an independent advice, if necessary.

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