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Talking Points:

- Q2 started with a bang across equity markets as yesterday saw another bearish drive show-up in the S&P 500[1]. A bit of support came-in around the 38.2% retracement of the post-Election move before the US close yesterday, and the S&P 500 has bounced up to find a bit of short-term resistance around an area of prior support.

- The US Dollar continues to cling to the 90.00 level in DXY[2], and this keeps the door open for a number of interesting scenarios on both sides of the Greenback. On the short-side of USD[3] are setups in both EUR/USD[4] and USD/JPY[5] that can remain interesting in the near-term, and we look at each below.

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Do you want to see how retail traders are currently trading the US Dollar? Check out our IG Client Sentiment Indicator[8].

US Stocks Start Q2 on a Rough Note

Yesterday’s open was not friendly to US equities[9], as a quick dip to start Q2 ran for the first part of the trading day. The S&P 500 made a fast approach towards the February double-bottom at 2,530; but a bit of support showed up around 2,550 ahead of the close with prices rallying-up to lower-high resistance. Price action[10] in US equity futures has remained largely stable in the overnight session and prices are holding on to yesterday’s support approach this morning’s open.

S&P 500 Four-Hour Chart: Pull Back to Find Resistance Around Prior Short-Term Support

s&p 500 four hour chart Chart prepared by James Stanley[11] At this point, prices have rallied back to the 76.4% retracement of bullish move off of the February lows; and this is an area that had previously helped to cauterize some support during last week’s sell-off. Resistance showing around prior support keeps US stocks in a bearish state as we move into the month of April, and the stage appears set for a retest of 2,530. And if that support can’t hold up after a third test, the bearish drive could grow considerably larger. Yesterday’s low came-in around the 38.2% Fibonacci retracement[12] of the post-Election move in the S&P, and this is at 2,554. Underneath that, we have that February low at 2,530, and a bit lower we have a prior swing around 2,490. The 50% retracement of the post-Election move resides at 2454, and if we can’t hold here, the door is opened for a test of the 61.8% retracement a 100-handles lower. S&P 500 Daily Chart: Potential Supports

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currensceneFLOGO WHTsquareThough not the oldest form of currency, some form of shell money appears to have been found on almost every continent. The shell most widely used worldwide as currency was the shell of Cypraea moneta, the money cowry.

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