NY Open: Twenty pounds of headlines
Markets started the day in a confusion of incoming news as ECB chatter met with trade talk updates and US macro data. EURUSD took it on the chin and dropped from 1.1270 to 1.1235.
The dollar is undergoing a major rally, or short-squeeze, with the Dollar Index heading back into positive territory for 2018 on May 1.
One key test of this trend will be today's Federal Open Market Committee outing. Markets do not expect any sort of policy move, but the reaction to the Fed's statement as investors pore over each and every potentially significant turn of phrase could be revealing as to the real level of confidence behind the USD surge.
Join Saxo Bank head of FX strategy John Hardy as he outlines the potential for post-FOMC volatility.