Trump Joins Market-Mover Elite

Ms. Janet Yellen. Ms. Theresa May. Mr. Mario Draghi. Mr. Mark Carney. Mr. Donald Trump. What do these high-powered names have in common? They all wield the power to move the Forex market with their words.

Today we focus on Trump and May as recent market swings show that there’s no end in sight to the influence of Brexit and Trump, the matching themes which have dominated the markets over the past 9 months.

Trump Says: The Dollar Is “Too Strong”

President-elect Donald Trump catalyzed a huge dollar drop against most major currencies when he told the Wall Street Journal that the Greenback is already “too strong”. This seems in conflict to Trumps growth-generative plans and has traders baffled over the meaning of his comments ahead of inauguration day on Friday June 20th.

USD Index

The USD Index, a measure of the strength of the Greenback against a basket of currencies, has dropped steadily since we stepped into 2017 and touched 100.30; its lowest level since early December and its 5th day consecutive decline is the most extensive daily continual drop in 5 months.

Looking back at 2016, the last time the USD Index dropped for more than 5 days in a row was back in May 2016, so we are interested to see if tomorrow it will drop for a 6th straight day or if it will keep with its pattern of strengthening after a 5-day decline.

May Says: Parliament To Vote On Final Brexit Deal

The British Pound surged after May confirmed that parliament will be able to vote on the final Brexit deal, and stirred momentum for the sterling’s best day since the Brexit vote as it rebounded from its lowest level since October.

The cable surged more than 2.8 percent against the U.S. Dollar to a high of 1.2396.

The currency not only strengthened against the USD but against all its major counterparts as May outlined the government’s Brexit strategy.

Despite Tuesday’s incredible recovery, the pound is still 17% weaker since the Brexit vote last June.

Caution Needed at 1.2000

It is noteworthy that the Pound rebounded after coming close to the big figure price of 1.2000 to the USD again on Monday, the first time it tried to breach that level since October 7th. Currency traders fare well to keep an eye on the 1.2000 level when trading short; the Pound would need a massive amount of momentum to breach this strong level of support.

Forex Trades On The Horizon

With so much impending volatility and activity, the ForexSignal.com Trading Team looks forward to taking advantage of the moves and we expect many opportunities to trade in the weeks and months ahead.