US futures rise as Trump weighs in on the market plunge
US futures pointed to a higher open after Donald Trump weighed in on the current rout. In an interview, the president said that he viewed the current decline in stocks as a tremendous buying opportunity for investors. In his period as president, Trump has paid close attention to the stock market. In recent months however, he has become frustrated with the declines and blamed the Federal Reserve. On Monday, he said that the Fed had lost touch with the overall feeling of the market. This came after a report said the president was considering firing Jerome Powell, a move that many believe would bring more damage to the market.
The Japanese yen declined sharply against the USD after a statement by the Bank of Japan (BOJ) governor. In the statement, the governor blamed the current rout in Japanese stocks market to the ongoing global uncertainties on trade. However, he said that the economy will likely continue moving in a gradual pace and withstand the ongoing issues. Previously, the BOJ released the minutes of the October meeting that showed some dissatisfaction among members on the policy of leaving the bond prices flexible.
Gold continued to rise as investors moved to the so-called safe haven. Gold started rising on December 14th and accelerated a week later when the Fed hiked interest rates. Gold is often viewed as a haven and a hedge against inflation. Therefore, with stocks declining, many investors have found themselves investing in the metal hoping that it will continue to rise.
The XAU\USD pair continued the upward momentum and reached a high of 1276. This was the highest level since June. The price is above the 28-day and 14-day moving average while the RSI has moved closer to the overbought level. At the same time, the Accumulation\Distribution has fallen to below zero. The pair could continue moving up ahead of the new year.
The EUR\USD declined today as the dollar rose. The pair reached a low of 1.1373, which is below the 14-day and 28-day simple moving average on the hourly chart. The momentum indicator has declined from the 100 level and is currently at 99.5 while the RSI has moved to 43. The pair could continue moving down although the next few days could be volatile.
The USD\JPY pair rose to an intraday high of 110.80. This price was along the 28-day simple moving average and below the 14-day average on the hourly chart. Today’s rise ended a sharp downward trend that started in December. The moving average convergence divergence (MACD) indicator has continued to move up. This is an indication that the pair could continue moving higher even though volatility could continue as investors position their trades for the coming year.