As the divergence in monetary policy between the US and Japan began to widen, the U.S dollar/Japanese yen(USD/JPY) curreny pair started its massive bull trend from around the year 2012 which ultimately ended in mid-2015, well before the December 2015 rate increase.
The American Petroleum Institute (API), an industry group, reported a sharper-than-expected 2.1 million barrel rise in U.S. weekly crude stockpiles. As a result, hopes that the official data from the EIA would reveal a 1.3 million decrease – the first decline in two weeks – were dashed.
On the technical front, the Dollar Index is bang in the middle of its 1.5-year consolidation range, holding near its flattening 50-week moving average. From a long-term point of view, the lengthy consolidation here is actually quite bullish given that the prior move was a rally that began in mid-2014 and that the index has been able to hold on to most of those gains.
European stocks have started Tuesday’s session on the front foot after a lacklustre performance on Monday. Sentiment remains upbeat for global equities mainly because of the actions of central banks, rebounding oil prices and the mostly better-than-expected U.S. corporate earnings results.