Intraday Forex Friday, April 29 (EURUSD, USDJPY, etc). Dollar stands tall as Fed eyes fast hikes, headed to score its best monthly gain in a decade.


Hi everyone. This observation is made around 08:00 UTC today, with 30 minutes time frames. The Resistance and Support Line were constructed according to Fibonacci retrenchment. Any discussion is welcomed.

Global stocks received a boost from strong corporate earnings, but remain on course for a negative month.
The dollar meanwhile gives back some of its gains throughout the past few weeks with modest moves across the board on afternoon session Friday, though still poised to score its best monthly gain in a decade, buoyed by bets on rising U.S. interest rates and doubts about growth in Europe and China.

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  • The euro added 0.40% on the last trading day of April, to stand at $1.05440 as the dollar pauses for breath.​
  • The euro, however, was still on track for its worst monthly performance since January 2015, after hitting a five-year low against of $1.04712 overnight.​
  • The euro has lost 5% on the dollar in April and just over 7% on the dollar since Russia's invasion of Ukraine on Feb 24.​
  • The dollar was buoyed this week by bets on rising U.S. interest rates and worries about growth in Europe and China. Market participants increasingly pricing in a widening divergence opening between the performance of the eurozone and U.S. economies and subsequently the outlook for European Central Bank and Fed policies.​
  • The outlook for the Fed to raise the funds rate by 50 bp at next week’s FOMC meeting is bullish for the dollar.​
  • The euro, meanwhile, was weakened following the halt in Russian gas supplies to Poland and Bulgaria, which has investors concerned about Europe's energy security, inflation and growth. Increased likelihood that Germany to join other European Union member states in an embargo on Russian oil also put pressure on the euro.​
  • The EUR/USD pair staged a rebound. The one-week-old descending trend line forms the initial resistance at around 1.0661, a 20-period SMA, followed by psychological 1.07150 next. On the downside, the first support is located at 1.04863 and 1.04321.​
Important Levels to Watch for Today:​
  • Resistance line of 1.06617 and 1.07159.​
  • Support line of 1.04863 and 1.04321.​

  • The dollar held firm at around the 20-year high on Friday against the Japanese yen, though slipped to 0.40% at 130.261. The yen is down more than 7% in April, its worst month since November 2016.​
  • Trade was thinned in the Asia session by a public holiday in Japan.​
  • The U.S. dollar’s recent gains have been most significant against the yen, in the wake of the yen's tumble after the Bank of Japan vowed to buy unlimited amounts of 10-year bonds daily to defend its yield target. The bank's strengthening of its commitment to ultra-low interest rates sent the U.S. dollar to a fresh high, weakened the Asian currency and pushed borrowing costs for U.S. dollars in currency derivatives markets sharply higher.​
  • The uber-dovish decision set Japan miles apart from the U.S. Fed, where markets are priced for 150 basis points of hikes in just three meetings, and triggered a fresh rush of funds into the dollar ahead of all else.​
  • The USD/JPY may continue to appreciate ahead of the FOMC interest rate decision on May 4. The USD/JPY pair rebound bullishly just above the support line and return to the main bullish channel again, which stops the correctional bearish scenario and lead the price to resume the bullish trend again, on its way to achieve positive targets above 130. The bullish bias will be suggested in the upcoming sessions.​
Important Levels to Watch for Today:​
  • Resistance line of 131.930 and 133.048.​
  • Support line of 128.314 and 127.196.​

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