2021-01-19 • Updated
Joe Biden will take the post of president of the USA on the morning of 20 January 2021. Trump is going to skip the inauguration. What will be the market reaction? Let’s find out!
Biden will arrive in Washington on Tuesday, where Trump isn’t expected to meet him. Well, tensions are rising, and the market volatility as well.
The USD has surged in January due to rising US Treasury yields and some investor caution about the strength of the global economic recovery from the Covid-19 pandemic. However, most analysts predict that traders should be ready for a weaker dollar from here.
The dollar has already retreated from a one-month high ahead of Biden’s inauguration tomorrow. Investors await Biden’s huge stimulus package of $1.9 billion to be unveiled soon. As a result, the market sentiment lifted and pressed safe-haven currencies like the dollar and Japanese yen down.
Elsewhere, the USD dropped as traders are getting ready for Treasury Secretary nominee Janet Yellen to talk later.
According to ING, “on fiscal policy, Yellen is to suggest that the US `act big’ and make use of the low borrowing costs. On the dollar, it should be reiterated that the new administration is committed to the market-determined exchange rate. Both are in line with our weak USD outlook”.
According to Saxo Bank, Yellen’s speech will underpin gold: “I struggle to see Yellen saying anything that won’t eventually turn out to be gold supportive”. “Saying that the administration will not pursue a weak dollar policy is not the same as saying they won’t allow the dollar to weaken.”
Stock indices climbed ahead of Treasury Secretary nominee Janet Yellen’s speech as she is expected to expand government support actions to boost the US economy.
In contrast to the mentioned above, some analysts consider that Biden’s inauguration will drag the USD upwards. His enormous stimulus package will boost the US economic activity and speed up the pace of recovery. Janet Yellen, Treasury Secretary nominee claimed that the US wouldn’t seek a weaker dollar for the competitive advantage. It may raise the demand for the USD.We would be happy to tell you what is going to happen, but nobody can predict with 100% how the new policy in the US will impact the markets. Follow the news, keep an eye on charts, and try to join the market flow!
EUR/USD significantly rose despite the dead cross, which signals further decline. If the pair manages to rise to the high of January 14 at 1.2170, the way up to the next resistance of 1.2220 will be clear. Support levels are at the recent low of 1.2050 and the key psychological mark of 1.2000.
Crude oil futures surged on Monday due to disruptions in Russian refining capacity caused by Ukrainian drone strikes and Moscow's decision to cut output to comply with OPEC+ targets. The West Texas Intermediate (WTI) contract for May settled at $81.95 a barrel, up $1.32, while the Brent contract for May settled at $86.57 a barrel, also up $1.32. Russia instructed...
Bearish scenario: Sales below 80.00 with TP1: 79.60... Anticipated bullish scenario: Intraday purchases above 80.70 with TP: 81.50...
Bearish Scenario: Sales below 78.99 with TP1: 77.93, TP2: 77.45, and upon its breakout TP3: 76.56 and TP4: 75.70 Bullish Scenario: Purchases above 78.00 (wait for a pullback to this area) with TP1: 1679.00 (uncovered POC*), TP2: 79.33, and TP3: 79.66 intraday
Jerome H. Powell, the Federal Reserve chair, stated that the central bank can afford to be patient in deciding when to cut interest rates, citing easing inflation and stable economic growth. Powell emphasized the Fed's independence from political influences, particularly relevant as the election season nears. The Fed had raised interest rates to 5.3 ...
Hello again my friends, it’s time for another episode of “What to Trade,” this time, for the month of April. As usual, I present to you some of my most anticipated trade ideas for the month of April, according to my technical analysis style. I therefore encourage you to do your due diligence, as always, and manage your risks appropriately.
Bearish scenario: Sell below 1.0820 / 1.0841... Bullish scenario: Buy above 1.0827...
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Don’t waste your time – keep track of how NFP affects the US dollar and profit!
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