Japanese yen falls as US-North Korea talks start
The price of crude oil rose today as the market downplayed the impact of Trump’s intervention in the oil market. On Monday, the president sent a tweet, asking OPEC to go easy on the oil market. The president argued that the recent bullish trend on the price of oil was not healthy. In another report by the Wall Street Journal, a senior leader of OPEC said that the cartel will probably not intervene. In December, the leaders met in Vienna and agreed to limit oil production in a bid to hike prices.
The markets paid close attention to a meeting between Donald Trump and North Korea’s Kim Jong-un. The meeting is taking place in Hanoi, Vietnam and is the second summit since last year. The United States is asking the North Korean leader to give up its missile program. North Korea, on the other hand, is asking the United States to remove sanctions. In the past year, North Korea has been accused of cheating while Trump has been under pressure to show results of his previous meeting.
The sterling rose today as traders continued to watch out for the ongoing talks on Brexit. This week, it has emerged that the UK could avoid a no deal Brexit. This is after Theresa May said that she was ready to extend the March 29 deadline. In the same week, the Labor leader Jeremy Corbyn said that the party will likely support another Brexit referendum. Investors now believe that the prime minister is likely to not risk a no-deal Brexit because of the negative implications it will have on the economy.
The GBP/USD pair rose as hopes of a no-deal Brexit deal faded. The pair reached a high of 1.3315, which is the highest level since October last year. On the hourly chart, this price is above the 42-day and 21-day EMA. The RSI is currently at 70 while the momentum indicator remains above 100. There is a likelihood that the pair will continue moving up although this could change depending on how the Brexit negotiations go.
The EUR/USD pair was little moved today as traders waited for Jerome Powel’s statement to Congress. The pair is trading at 1.1385, which is slightly lower than where it was yesterday. On the hourly chart, the pair is slightly above the 14-day moving averages. The RSI is currently slightly below the 70 level while the signal line of the MACD is moving closer to the neutral level. The pair could remain at these levels and move during Powell’s testimony.
The USD/JPY pair rose as talks between North Korea and the United States started. The yen is often viewed as a safe haven currency by investors and as the best way to play the North Korean issue. The pair reached a high of 110.80. On the hourly chart, the pair is above all the short and medium-term moving averages. It is also along the upper band of the Bollinger Bands. There is a likelihood that the pair will continue moving up although this could change depending on how the talks between North Korea and the US go.