For the first trading day of the week, we continued to see the dollar come out on top, which is primarily due to a resurgence in the US 10 yr treasury yield. The yield for the 10-year note, which is the benchmark that the Federal Reserve Bank uses to guide interest rates, has climbed up to 3.0%, which will always be supportive for a round of demand in the greenback. During this morning’s trading session, we observed US Dollar crosses, and some of our currency majors trade in favor of the buck, as investors appear to be slightly relieved that some of the Geo-political tensions have softened and their is a demand for risk-oriented assets at the start of this new week of trading. In this trading webinar, we discussed how the climb in treasury yields could encourage an increase in the pace of rate hikes for 2018.
Prior to the start of this webinar, we discovered that business activity in the Eurozone continued to rise at a solid pace, but the pace of expansion has been weaker than usual due to supply & demand constraints. The Euro-Wide Manufacturing index came in at a reading of 55.8, which is down from 55.9 in March, and the lowest level in 17 months. However, services activity in the European Union improved, with the index climbing to 55.0, its highest level in two months. Although the Markit PMI data was better than expected, it still didn’t manage to overshadow the market’s fixation on the US 10 Year Treasury yield, and we continued to see EUR/USD sell off on this news.
During most of today’s forex trading webinar, we reviewed price action in EUR/USD, AUD/JPY, EUR/CAD, GBP/JPY, EUR/AUD and EUR/GBP to identify technical setups that were forming in the market for trade entry. You can watch this morning’s trading webinar session below:
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