The EURUSD has rotated back to the downside as yields continue to run higher with the 10 year now up 14 basis points. That comes despite weaker ISM data.
The US Supreme Court did rule in favor of Donald Trump regarding presidential immunity which makes prosecution for January 6th a hard hurdle. Whether that is the influence, I am not sure, but stocks have also slipped. It has been a good few days for former president Trump as the current President Biden stumbles and fumbles into the election. Does a Trump victory mean more tariffs, higher inflation. Maybe a new Fed Chair who is more dovish than Powell? Does that not sit well with the bond market? Trump wants to lower tax rates as well. It might have worked at the start of his last 4 years, but coming off higher inflation and stronger economy is it not so good? We are learning but the market is reacting with higher dollar, higher rates.
Technically, the price of the EURUSD has broken below its 100 bar moving average on 4-hour chart at 1.0734 and enters into a swing year between 1.0719 and 1.07346. Falling below the low of that swing everyone at traders looking toward the bottoms over the last three trading weeks between 1.0665 and 1.06703 (close enough for a triple bottom?)
Watching 1.07196.
Meanwhile, the USDJPY is extending to a new high and further away from the rising 100 hour MA at 160.57. The USDJPY new high going back to 1986 just reached 161.734.
This article was written by Greg Michalowski at www.forexlive.com. Source