Bitcoin 
Ethereum 
Tether 
XRP 
BNB 
USDC 
Solana 
TRON 
Lido Staked Ether 
Figure Heloc 
FUNDAMENTAL
OVERVIEWUSD:The US dollar rallied
across the board yesterday on safe haven demand as US-Iran conflict erupted
over the weekend. The main driver though was the market’s realisation that rate
cuts might not come as soon as expected. In fact, higher oil prices
will eventually put upward pressure on inflation and yesterday’s ISM Manufacturing PMI showed how wrong the market has
been in being so dovish on the economy. The data was hot for the second
consecutive month, so the one-off narrative was put to rest. Moreover, the prices index
jumped to the highest level since 2022, in another sign that inflationary
pressures remain high. Traders pared back their rate cut bets with the total
easing by year-end now seen around 45 bps vs 58 bps on Friday. EUR:On the EUR side, nothing
has changed on the macro side, but the US-Iran conflict led to a surge in energy
prices which are feeding into higher inflation expectations. The Eurozone
CPI today was higher than expected which coupled with the higher energy
prices is leading to rate hike bets. The market is pricing a 21%
chance of a rate hike in June already and 50% by the end of the year. On the
other hand, ECB policymakers are cautioning against reacting too fast to Middle
East events as they could end up being transitory like in the past. EURUSD TECHNICAL
ANALYSIS – DAILY TIMEFRAMEOn the daily chart, we can
see that EURUSD is approaching the key swing
level at 1.1575. That’s where we can expect the buyers to step in with a
defined risk below the level to position for a rally back into the 1.18 handle.
The sellers, on the other hand, will look for a break to increase the bearish
bets into the 1.14 handle next.EURUSD TECHNICAL
ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, there’s
not much we can add here as the nearest key level is the swing point at 1.1575.
We need to zoom in to see some more details.EURUSD TECHNICAL ANALYSIS –
1 HOUR TIMEFRAMEOn the 1 hour chart, we have a downward trendline defining the bearish
momentum. If we were to get a pullback, we can expect the sellers to lean on
the trendline with a defined risk above it to keep pushing into new lows. The
buyers, on the other hand, will look for a break higher to increase the bullish
bets into the 1.1740 resistance. The red lines define the average daily range for today. UPCOMING CATALYSTSTomorrow we have the US ADP and the US ISM Services PMI. On Thursday, we get the
latest US Jobless Claims figures. On Friday, we conclude the week with the US
NFP report. The data might not matter much this week amid the US-Iran conflict.
This article was written by Giuseppe Dellamotta at investinglive.com.
đź’ˇ DMK Insight
The US dollar’s recent rally signals a shift in market sentiment, driven by geopolitical tensions and inflation concerns. With the US-Iran conflict escalating, traders are flocking to the dollar as a safe haven, which could strengthen its position against other currencies. The realization that rate cuts may be delayed is crucial; higher oil prices are likely to keep inflation elevated, complicating the Fed’s monetary policy. This environment could lead to a stronger dollar in the short term, especially if inflation metrics continue to surprise to the upside. Traders should monitor key levels in the dollar index and related currency pairs, looking for potential breakouts or reversals. However, it’s worth questioning whether this dollar strength is sustainable. If geopolitical tensions ease or if economic indicators suggest a slowdown, we might see a rapid reversal. Keep an eye on inflation reports and oil price movements, as these will be pivotal in shaping market expectations and trading strategies moving forward.
đź“® Takeaway
Watch for inflation data and oil prices; a sustained dollar rally could unfold if these trends persist.
