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MikhailLF

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  1. Morning Market Review 2019-09-20 08:38 (GMT+2) EUR/USD The European currency showed strong growth against the US dollar yesterday, at some point reaching levels of opening trading on Wednesday, which ended with a fairly confident decline of the instrument. At the close of yesterday's session, the euro retreated, having lost most of its gains. The reason for the appearance of a corrective pullback was good data from the United States. Existing Home Sales in August increased by 1.3% MoM after growth of 2.5% MoM last month. Analysts had expected decline by 0.4% MoM. Philadelphia Fed Manufacturing Index in September fell from 16.8 to 12.0 points, which was still better than market expectations of 11.0 points. During today's Asian session, the euro is trading with an increase again. Investors expect publication of German PPI and preliminary data on Consumer Confidence in the euro area in September. GBP/USD The British pound rose significantly against the US dollar on Thursday, updating local highs of July 15. The Bank of England Meeting Minutes published the day before did not affect the dynamics of the instrument, since they fully met market expectations. The British regulator unanimously decided to keep the interest rate at the current level of 0.75%. The volume of the quantitative easing program remained at around 435 billion pounds. In turn, statistics on Retail Sales in the UK exerted little pressure on the pair. In August, the indicator fell by 0.3% MoM after growth of 0.4% MoM last month. In annual terms, the index has slowed from +3.4% YoY to +2.7% YoY, with the forecast of +2.9% YoY. The main factor behind the growth of the pound was the comments of European Commission President Jean-Claude Juncker, who noted that he believed in the conclusion of the Brexit deal before October 31. AUD/USD The Australian dollar is slightly correcting against the US currency during today's Asian session, recovering from two days of steady decline. Contradictory data on the Australian labor market put pressure on the instrument on Thursday. Despite a steady increase in employment by 34.7K jobs in August, the country's Unemployment Rate reached new highs at 5.3%, which is likely to push the RBA to new measures to stimulate the economy. Nevertheless, after a series of world regulators meetings, the attention of investors is once again shifting to the process of negotiations between the US and China, which should begin in October. So far, the prospects for a new round of trade talks look very encouraging. USD/JPY The US dollar fell against the Japanese yen on Thursday, retreating from local highs, updated the day before. The decrease in the instrument is largely technical in nature, since the market situation is not changing much. Demand for the Japanese currency is supported by a further decrease in forecasts for world GDP growth and the uncertain situation around Brexit and the new round of US-Chinese trade negotiations. During today's Asian session, investors focus on consumer inflation statistics from Japan. In August, the National Consumer Price Index slowed down from the previous +0.5% YoY to +0.3% YoY, which turned out to be twice worse than forecasts. The investment indicators were also negative. Foreign Bonds Buying for the week as of September 13 slowed from 727.2 to 476.0 billion Japanese yen. Foreign investment in the Japanese stocks fell by 971.9 billion yen after a decrease of 161.5 billion. Oil Oil prices corrected on Thursday, departing from local lows, updated after a steady decline in quotes at the beginning of the week. The situation with drone attacks on Saudi oil production complexes is gradually fading into the background, but now investors are paying attention to the depletion of oil reserves in Saudi Arabia, which will not allow it to restore supply volumes just as easily in the event of new attacks. Meanwhile, the situation in the Middle East remains tense. The day before, US President Donald Trump ordered to significantly increase sanctions against Iran, which could lead to a new round of crisis in the region.
  2. Morning Market Review 2019-09-19 08:37 (GMT+2) EUR/USD The European currency again showed a decline against the US dollar on Wednesday, partially offsetting the active growth of the instrument the day before. The development of the downtrend was promoted by contradictory macroeconomic statistics from Europe, as well as by the results of the meeting of the Fed, at which the US regulator made a predicted decision to reduce the interest rate to 2.00%. Euro area's CPI in August showed a slight increase of 0.1% MoM after a decline of 0.5% MoM last month. Analysts expected a more active growth of +0.2% MoM. In annual terms, inflation growth remained at the previous level of 1% YoY. Construction Output in the euro area in July fell by 0.73% MoM after rising by 0.64% MoM last month. The indicator was worse than the forecast of +0.70% MoM. In annual terms, production volumes slowed down from +1.6% YoY to +1.1% YoY, which turned out to be slightly better than the forecast of +1.0% YoY. GBP/USD The British pound showed a decline against the US dollar on Wednesday, retreating from its local highs, updated the day before. Pressure on the instrument was provided by statistics on Consumer Inflation published in the UK. CPI in annual terms slowed down from +2.1% YoY to +1.7% YoY, which turned out to be worse than the forecast of +1.8% YoY. Core CPI for the same period strengthened by 1.5% YoY with the forecast of 1.8% YoY. In monthly terms, the index growth accelerated from 0.1% MoM to +0.4% MoM, which did not reach the forecast of +0.7% MoM. Another negative factor for the pound is still the situation around Brexit. Earlier the European Commission approved the possibility of delaying the deadline for Brexit, but reminded the UK of financial obligations. Today, investors are focused on the Bank of England meeting on the interest rate. Given the high degree of uncertainty surrounding Brexit, the British regulator is not expected to make any changes to the monetary policy vector, however, official comments will continue to be important. AUD/USD The Australian dollar showed an active decline on Wednesday and continues the steady development of the downtrend during today's Asian session. The Fed’s decision to lower the interest rate to 2.00%, which was published the day before, only slightly affected the position of the American currency, since it had long been incorporated into current quotes. Investors are focused on the statistics on the Australian labor market today. Employment Change in August showed an increase of 34.7K jobs after an increase of 41.1K last month. Analysts expected only +10.0K. Participation Rate increased from 66.1% to 66.2%, which also turned out to be better than the forecast. At the same time, the Unemployment Rate in August expectedly increased from 5.2% to 5.3%. USD/JPY The US dollar closed Wednesday trading with moderate growth against the Japanese yen, updating local highs of August 1. During today's Asian session, the instrument shows an active decline, retreating from updated highs. In addition to a number of technical factors, pressure on the pair is exerted by the decision taken by the Fed yesterday to lower the interest rate to 2.00%. Despite the fact that the decision of the US regulator was quite predictable, a certain intrigue persisted, and some analysts expected more active actions of the regulator, as repeatedly called on by Donald Trump. Jerome Powell did not disclose any plans for the remaining year, noting only that they “will act according to the situation.” Today, investors are focused on the Bank of Japan meeting on the interest rate. As expected, the Japanese regulator left the key rate unchanged at –0.1%, indicating growing risks and a high level of uncertainty in the global economy. Oil Oil prices continued a moderate decline on Wednesday, developing a downtrend since the beginning of the week, when the instrument opened with a sharp upward gap in response to a series of attacks on the oil production capacities of Saudi Arabia. On Tuesday, quotes plummeted amid statements by Saudi Arabia about the full restoration of oil production in a few weeks. Additional pressure on the instrument yesterday was exerted by the EIA report indicating an increase in oil inventories for the week as of September 13 by 1.1M barrels. The volume of oil production in the United States did not change and amounted to the previous 12.400M barrels per day.
  3. Morning Market Review 2019-09-18 08:48 (GMT+2) EUR/USD EUR showed strong growth against USD on Tuesday, recovering from an equally strong decline of the instrument at the beginning of the week. The growth of EUR was largely technical in nature, while macroeconomic statistics remained contradictory. German ZEW Economic Sentiment in September showed an increase from –44.1 to –22.5 points with a forecast of –38.0 points. German ZEW Current Conditions for the same period fell from –13.5 to –19.9 points, which turned out to be worse than the forecasts of –15.0 points. The EU ZEW Economic Sentiment in September grew slightly from –43.6 to –22.4 points, exceeding forecasts of –37.4 points. Today, the pair is trading in both directions. Investors expect the publication of the results of the Fed meeting, at which, as expected, the interest rate will be reduced by 0.25 points. GBP/USD GBP rose against USD on Tuesday, updating local highs of July 19. The instrument is supported by timid optimism regarding the Brexit deal, as there has been some change in mood in the parliament. At the same time, threat of hard Brexit remains, and earlier, Prime Minister Boris Johnson said that he would not ask the EU for another postponement, as required by the bill recently adopted by the parliament. During today's Asian session, the pair is trading with a decrease. On Wednesday, investors are focused on statistics from the UK on consumer and industrial inflation in August, as well as a decision by the Fed on interest rate. AUD/USD AUD showed ambiguous dynamics against USD on Tuesday, recovering to the opening levels from local lows of September 6. The instrument managed to strengthen against the background of the publication of good macroeconomic statistics from the United States. Industrial production in August showed an increase of 0.6% MoM after a decrease of 0.1% MoM last month. Analysts had expected increase by +0.2% MoM. Capacity Utilization Rate in August also increased from 77.5% to 77.9%, exceeding the forecast of 77.6%. Today, the instrument is declining, pending the publication of the Fed decision on the interest rate. In addition, investors are waiting for the release of a report on the Australian labor market on Thursday. USD/JPY USD showed ambiguous trading dynamics against JPY on Tuesday, updating local highs of early August. Yesterday's macroeconomic statistics from the US provided some support for USD, but moderate demand for safe haven assets leveled the entire “bullish” advantage of the dollar. During today's Asian session, the instrument is again trading in both directions, awaiting the Fed's decision on the interest rate. Statistics from Japan was contradictory. Japanese exports went down by 8.2% YoY in August after the decline by 1.5% YoY in the previous month. Analysts had expected even larger decline by –10.9% YoY. Imports collapsed by 12.0% YoY for the same period after a decline of 1.2% YoY last month. Forecasts suggested a decrease of 11.2% YoY. The deficit of the adjusted Trade Balance in August amounted to 136.80B yen, which is slightly worse than the previous value of –126.751B yen, but noticeably better than market expectations of –268.40B yen. Oil Oil prices fell on Tuesday, after Saudi Arabia reported that the previous production volumes could be fully restored within a few weeks. Over the weekend, oil refineries in Saudi Arabia were attacked by drones, which halved production volumes and intensified the crisis in the Middle East. Oil reacted to these events with significant growth, updating highs of the end of May. API Weekly Crude Oil Stock report published on Tuesday reflected a moderate increase in reserves for the week as of September 13 at 0.592 million barrels after a decrease of 7.200 million barrels over the past period. On Wednesday, in addition to the publication of the Fed decision on the interest rate, investors expect the release of EIA Crude Oil Inventories report.
  4. Morning Market Review 2019-09-17 08:49 (GMT+2) EUR/USD EUR showed a decline against USD on Monday, retreating from its local highs of August 27 updated at the end of last week. The pressure on the instrument was provided by weak data from China, as well as by a number of statements by representatives of the ECB that noted the low growth rates of the European economy. Retail sales in China in August showed a slowdown from 7.6% to 7.5% YoY with a forecast of +7.9% YoY. Over the same period, Industrial Production slowed down from +4.8% YoY to +4.4% YoY, which also turned out to be worse than the forecast of +5.2% YoY. During today's Asian session, the instrument shows corrective growth, awaiting the publication of European statistics on business sentiment. However, analysts do not foresee a confident growth of the pair, therefore, only weak USD exchange rate could perhaps help the “bulls”. GBP/USD GBP fell against USD at the beginning of the current trading week, reacting to several factors. Investors are still concerned about the slow pace of development around Brexit. There is not much time left until the deadline, and Boris Johnson is trying more to enlist the support of his supporters, rather than looking for ways to get the agreement approved in parliament. Johnson’s meeting with European Commission President Jean-Claude Juncker was unsuccessful. Moreover, the British Prime Minister reiterated his intention not to request a postponement of Brexit. It is likely that Johnson will try to ignore the parliament’s ban on the hard Brexit, but this threatens to exacerbate the political crisis in the UK, which will negatively affect the country’s economy if it does leave the EU at the end of October. AUD/USD AUD showed ambiguous trading dynamics against USD on Monday, falling under pressure from weak macroeconomic statistics from China. In addition, investors are actively reacting to the aggravation of the situation in the Middle East and the increased threat of a US war with Iran. Last weekend, the oil refining facilities of Saudi Arabia were attacked, which caused a rapid increase in oil prices. The US was quick to blame Tehran for the attacks, and Donald Trump announced his readiness to retaliate after confirming the suspicions of Saudi Arabia. During today’s Asian session, the pair shows a downward trend. Investors are focused on statistics from Australia and published minutes of the RBA meeting of September 3, at which the rate was maintained unchanged at 1.00%. Australian Housing Price Index in Q2 2019 showed a decline of 0.7% QoQ after a decrease of 3.0% QoQ last month. Analysts had expected a decrease of 1.0% QoQ. USD/JPY USD showed strong growth against JPY on Monday. However, it is worth noting that the instrument opened with a significant gap down, so by the end of the trading session USD only managed to recoup its losses at the opening. Meanwhile, JPY is supported by the aggravation of the situation in the Middle East after a series of attacks on oil refineries in Saudi Arabia. The United States accused Iran of assault and declared readiness to retaliate if Saudi Arabia confirms Tehran’s responsibility for the attack. During today's Asian session, the pair is trading in both directions. Investors expect the situation in the Middle East to develop and are awaiting the publication of macroeconomic statistics from the USA on retail sales and industrial production in August. Oil Oil prices showed ambiguous dynamics on Monday, after the market opened with record growth of more than 10% amid a worsening situation in the Middle East. At the weekend, oil refineries in Saudi Arabia were attacked by drones, which led to a reduction in Saudi production by half. The United States accused Iran of assault, saying it was ready to strike back if Saudi Arabia confirms Washington’s suspicions. In addition, Donald Trump approved the use of petroleum products from the US strategic reserve to help stabilize supply and demand in the market. On Tuesday, investors focus on the American Petroleum Institute Crude Oil Stock report for the week as of September 13, which last time showed a decrease in reserves of 7.2 million barrels. There is little hope that today’s report will be positive.
  5. Morning Market Review 2019-09-16 08:40 (GMT+2) EUR/USD The European currency ended last week trading with moderate growth against the US dollar, updating local highs of August 27. Positive dynamics of the instrument was facilitated by the improved prospects for resolving the US-Chinese trade conflict. After a series of concessions by the parties, the negotiations, which should begin in October, have a high chance of ending successfully. In addition, Donald Trump spoke out for the possibility of reaching some kind of interim solution by signing a temporary agreement that would resolve a number of basic issues. The focus of European investors remained on the outcome of the ECB meeting on Thursday. As expected, the regulator lowered the deposit rate to the level of –0.50%, and also announced the resumption of the quantitative easing program. In addition, the ECB has revised its basic forecasts for GDP and inflation. GBP/USD The British pound rose significantly against the US dollar on Friday, updating local highs of July 25. The instrument was supported by news on Brexit, according to which the Democratic Unionist Party, which is an ally of the ruling Conservative party, said it would approve an agreement with the EU if an item on the Irish border was excluded from it. British Prime Minister Boris Johnson also spoke on the "moderate optimism" in the matter of concluding a deal with the EU. During today's Asian session, the instrument is trading in both directions. The Rightmove House Price Index decreased by 0.2% MoM after a decrease of 1.0% MoM in the previous month. YoY, the indicator slowed from +1.2% to +0.2%. AUD/USD The Australian dollar showed growth against the US currency on Friday, updating local highs of July 31. Optimistic signals about the US-Chinese trade negotiations, which may end with the signing of an interim agreement between the parties, contributed to the "bullish" sentiment on the instrument. During today's Asian session, the pair is also trading higher. However, the overall activity of buyers remains restrained. More confident development of the uptrend is hindered by weak statistics from China. In August, Retail Sales in China slowed from +7.6% YoY to +7.5% YoY, which turned out to be much worse than market expectations of +7.9% YoY. Industrial Production growth rate decreased from +4.8% YoY to +4.4% YoY against the forecast of +5.2% YoY. USD/JPY The US dollar closed last week with a fairly steady growth against the Japanese yen, updating local highs of August 1. "Bullish" activity remains on Monday, but the instrument showed a significant gap down at the opening and is now forced to recoup to its previous local highs. The US dollar is in demand amid improved prospects for US-Chinese trade negotiations, after the parties made mutual concessions, and Donald Trump announced the possibility of concluding an interim agreement. The macroeconomic statistics from the US published on Friday was contradictory. Retail Sales in August decreased from +0.8% MoM to +0.4% MoM, which, however, turned out to be better than expectations of +0.2% MoM. At the same time, Michigan Consumer Sentiment in September showed an increase from 89.8 to 92.0 points with a forecast of 90.9 points. Oil Oil prices showed a decline last week, despite the fact that on September 10 quotes updated local highs of early August. The instrument was supported on Friday by Baker Hughes Oil Rig Count, which reflected a decrease in the number of rigs from 738 to 733 units. The new week trading opened with a sharp gap up. The rise in oil prices was facilitated by news from Saudi Arabia, where on September 14 supporters of the Yemeni rebel movement started a fire at an oil refinery, which halved oil production.
  6. Morning Market Review 2019-09-13 08:48 (GMT+2) EUR/USD EUR rose against USD on Thursday, updating local highs of August 29. At the same time, during the day the instrument traded mainly with a decrease, and the published ECB decision on monetary policy even led to a short-term collapse of EUR to the lows of September 3. As expected, the European regulator kept the key interest rate unchanged at 0.0% and lowered the deposit facility rate to –0.50%. The ECB also announced the launch of a new quantitative easing program of EUR 2.6 trillion at a rate of EUR 20 billion per month in November. Despite the fact that the regulator’s decision coincided with forecasts, analysts note that a certain split has been outlined in the ECB camp, and this may threaten new problems in the future. However, the European regulator is waiting for changes soon as Christine Lagarde, who now heads the IMF, will take the chair. GBP/USD GBP showed a slight increase against USD on Thursday, continuing the development of flat dynamics in the short term. The focus of investors remains on the situation with Brexit. Despite the efforts of the British Parliament, the threat of the hard Brexit persists, since a new deal has not yet been developed, and the British Prime Minister remains adamant about the Irish border backstop. Yesterday's US statistic was ambiguous. In August, the Consumer Price Index slowed from +0.3% MoM to +0.1% MoM, which coincided with the forecasts. In annual terms, consumer inflation grew by 1.7% YoY, which turned out to be worse than market expectations of +1.8% YoY. Core CPI showed an increase of 0.3% MoM with a forecast of +0.2% MoM. AUD/USD AUD showed moderate increase against USD, updating local highs of July 31. At the same time, the instrument failed to consolidate at new highs, and by the time the afternoon session closed, USD won back part of the losses amid cautious optimism from the publication of consumer inflation in the US. AUD is supported by emerging progress in the US-Chinese trade negotiations. Earlier the parties made concessions to each other: Washington postponed the date of another increase in import duties, and Beijing resumed import of agricultural machinery, raw materials and medicines from the US. Investors today are focused on macroeconomic statistics on US retail sales in August. In addition, traders are interested in data on import prices and Michigan consumer expectations in September. USD/JPY USD continues a confident upward rally against JPY, updating highs of August 1. USD is supported by a high demand for risky assets amid some improvement in global prospects. In particular, investors are optimistic about the start of a new round of trade negotiations between the United States and China, because this time the parties approach this process with some groundwork. During today's Asian session, the instrument is trading in both directions. Traders are interested in data on retail sales and Michigan consumer expectations in the US. It is possible that at the end of the week the instrument will try to correct against the background of the closure of part of the long dollar positions. Oil Oil prices fell on Thursday, responding to OPEC+ decision to leave the parameters for reducing oil production unchanged. The central place in the discussions was given to the reduction of production in Russia, Nigeria and Iraq to the indicated levels, and it was decided to postpone the discussion of the issue of changing these levels to the December meeting of the cartel. Additional pressure on the instrument was provided by the ECB decision to lower deposit rates and to launch a new program of quantitative easing. Immediately after the publication of the decision of the European regulator, Donald Trump again criticized the Fed and demanded immediate action. It is possible that the decision of the American regulator next week will be adjusted according to the example of the ECB, and the market will see a more active easing of monetary policy. On Friday, investors expect the Baker Hughes Oil Rig Count in the US to be published.
  7. Morning Market Review 2019-09-12 08:46 (GMT+2) EUR/USD European currency showed a steady decline against the US dollar on Wednesday, updating local lows of September 4. Investors corrected their open long positions on EUR before the ECB meeting on monetary policy. It is expected that the European regulator can go for an additional reduction in the deposit rate from –0.4% to –0.5% and keep the key rate at zero level. In addition, the ECB is expected to take other steps aimed at stimulating the European economy. In particular, the head of regulator Mario Draghi previously actively discussed the possibility of resuming the quantitative easing program. The ECB activities are likely to affect the decisions of other regulators. In particular, the Fed and the Bank of England are expected to hold meetings next week. GBP/USD The British pound is showing ambiguous dynamics paired with the US currency, consolidating near its local highs, updated at the beginning of the week. Investors are still focused on the Brexit situation. The day before, it became known that Scottish appeal court found that Boris Johnson suspended the Parliament unlawfully. The government, in turn, noted that they were disappointed with such a court decision and would appeal it to the Supreme Court. During today's Asian session, the RICS Housing Price Index provides some support for the instrument. In August, the indicator fell by 4% MoM after a decline of 9% MoM last month. Analysts had expected a significantly sharper decline of 11% MoM. AUD/USD The Australian dollar closed trading on Wednesday with ambiguous dynamics against the US currency. The instrument was under pressure from weak macroeconomic statistics from Australia. Westpac Consumer Sentiment in September showed a decline of 1.7% after rising by 3.6% last month. At the same time, American statistics came out better than the forecasts. The Core PPI in August showed an increase of 0.3% MoM after a decrease of 0.1% MoM in July. In annual terms, the indicator accelerated from +2.1% YoY to +2.3% YoY, while analysts expected +2.2% YoY. MBA Mortgage Applications for the week as of September 6 strengthened by 2.0% after a decrease of 3.1% over the past period. During today's Asian session, the Australian dollar is showing strong growth, updating local highs from July 31. Support for the instrument is provided by Donald Trump's decision to postpone the introduction of regular import duties on Chinese goods from October 1 to October 15. USD/JPY The US dollar continues to grow steadily against the Japanese yen, updating local highs of August 1. Support for the US currency is provided by moderately optimistic macroeconomic statistics on industrial inflation in the United States, published the day before. In addition, a slight improvement in the prospects for future US-Chinese trade negotiations contributes to increased demand for risk. China announced the abolition of part of import duties on American goods, and Donald Trump in response announced the postponement of the introduction of new increased duties. Thus, the market has received confirmation that the parties are preparing for a new round of negotiations in October and are interested in ending the conflict. Statistics from Japan published during today's Asian session turned out to be contradictory and did not provide significant support to the yen. The PPI in August fell by 0.9% YoY after a decline of 0.6% YoY last month. Analysts had expected decline by 0.8% YoY. Core Machinery Orders in July fell by 6.6% MoM after growth of 13.9% MoM last month. Analysts had expected the decline of 9.0% MoM. Oil Oil prices fell significantly on Wednesday, retreating under the onslaught of the rising USD and the publication of a report from the US Department of Energy. According to the report, over the week as of September 6, Crude Oil Inventories fell by 6.9M barrels after a decrease of 4.8M barrels over the past period. Analysts had expected a decrease of only 2.6M barrels. At the same time, the oil refining capacities grew by 0.3% and reached the level of 95.1% against the forecast of a decrease of 0.6%. US oil production remained unchanged at 12.400M barrels per day.
  8. Morning Market Review 2019-09-11 08:43 (GMT+2) EUR/USD The European currency showed ambiguous dynamics paired with the US dollar on Tuesday, closing with almost zero result. Investors remained focused on the prospects for US-Chinese trade negotiations. The market was supported by statements by US Secretary of the Treasury Steven Mnuchin, who noted that the parties are close to forming the fundamental points of the agreement in the field of intellectual property protection in the USA. In turn, China may increase the volume of orders for American agricultural machinery and products in order to achieve a number of concessions from the United States, in particular, delaying the introduction of new high import duties. Additional pressure on the euro is exerted by the expectation of the ECB meeting, which will be held this Thursday. Investors expect rather sharp steps from the regulator aimed at further easing of monetary policy. GBP/USD The British pound showed flat dynamics against the US dollar on Tuesday. Investors were focused on the statistics on the UK labor market. Average Earnings ex Bonus in July slowed down from +3.9% 3MoY to +3.8% 3MoY, which coincided with the forecasts. Average Earnings Index + Bonus for the same period increased from 3.8% 3MoY to 4.0% 3m / g. The Unemployment Rate in July for 3 months fell from 3.9% to 3.8%, although analysts did not expect any changes. Claimant Change in August increased from 19.8K to 28.2K. Thus, investors were somewhat reassured regarding a possible recession in the British economy. Nevertheless, despite the very decisive actions of the British Parliament, the threat of a hard Brexit still remains. The Parliament rejected the bill on holding of early elections, but soon it will have to go on an extraordinary recess until mid-October. AUD/USD The Australian dollar showed ambiguous dynamics against the US currency on Tuesday, closing near the levels of the beginning of the afternoon session. The reason for the emergence of ambiguous trading was the correctional sentiment in favor of the US dollar. Additional pressure on the instrument was provided by weak data from Australia. NAB Business Confidence in August fell from 4 to 1 point. NAB Business Survey for the same period receded from 2 to 1 point. During today's Asian session, the instrument again shows steady growth. Statistics published in Australia turned out to be negative, but did not affect the instrument significantly. Westpac Consumer Sentiment in September showed a decline of 1.7% YoY after rising by 3.6% YoY last month. USD/JPY The US dollar continues to grow steadily against the Japanese yen, updating local highs of August 1. Positive dynamics in the instrument proceeds against the backdrop of increased interest in risk, despite persisting factors of uncertainty in the market. Statistics from Japan published the day before puts pressure on the yen. Machine Tool Orders in August showed a decrease of 37.1% YoY after a decrease of 33.0% YoY. During today's Asian session, moderate support for the yen is provided by BSI Large Manufacturing Conditions index. In Q3 2019, the index fell by only 0.2 points after a decrease of 10.4 points in the previous quarter. Oil Oil prices showed moderate growth on Tuesday, receiving support from the statements of the new Minister of Energy of Saudi Arabia, Prince Abdulaziz bin Salman, who noted that the OPEC+ alliance will exist in the long term, and the current agreement on limiting oil production is likely to be extended. Nevertheless, the instrument failed to consolidate at new highs, and by the time the afternoon session closed, sales were prevailing in the market. However, the development of the "bearish" sentiment could not be stopped by API Weekly Crude Oil Stock report. For the week as of September 6, the indicator dropped by 7.200 million barrels after an increase of 0.401 million barrels over the past period. Today, investors are awaiting the publication of the EIA Crude Oil Inventories.
  9. Morning Market Review 2019-09-10 08:37 (GMT+2) EUR/USD The European currency showed moderate growth against the US dollar on Monday, again approaching its local highs, updated at the end of last week. European currency was supported by good data from Germany. Exports from Germany in July increased by 0.7% MoM after a decrease of 0.1% MoM last month. Analysts had expected negative dynamics to worsen to –0.5% MoM. Imports showed a steady decrease of 1.5% MoM for the same period after a rise of 0.5% MoM last month with a forecast of –0.3% MoM. All this led to a marked increase in the trade balance in Germany. In July, it reached EUR 20.2B against the previous value of EUR 18.1B. Experts predicted a decrease to EUR 17.5B. The "bullish" sentiment for the instrument was also supported by data on Investor Confidence from the euro area. In September, according to Sentix, the indicator showed growth from –13.7 to –11.1 points, which turned out to be better than expectations of –14.0 points. GBP/USD The British pound rose significantly against the US dollar earlier this week, updating local highs of July 29. Moderate support for the instrument on Monday was provided by macroeconomic statistics from the UK, which signaled a decrease in the risks of a recession in the British economy. The UK GDP in July grew by 0.3% MoM after zero dynamics last month. Analysts had expected growth by 0.1% MoM only. Industrial Production in July also increased by 0.1% MoM after a decline of 0.1% MoM in June. Manufacturing Production over the same period strengthened by 0.3% MoM after a decrease of 0.2% MoM a month earlier. During today's Asian session, the instrument is trading in both directions. Investors are focused on July/August UK labor market statistics. AUD/USD The Australian dollar continues a confident upward rally paired with the US currency, updating local highs of July 31. The growth of the instrument is facilitated by good macroeconomic publications from Australia. Home Loans in Australia rose sharply in July by 5.0% MoM after a decline of 0.8% MoM a month earlier. Another "bullish" factor for the instrument is China’s step towards resolving its trade conflict with the United States. Beijing has offered to purchase some agricultural products from the US in exchange for easing restrictions for Huawei. In addition, China expects to postpone the introduction of new import duties on its goods. During today's Asian session, the pair is trading with a decrease. Despite the publication of strong data on consumer inflation in China, investors are in no hurry to open new purchases, preferring to take profits. USD/JPY The US dollar is strengthening against the Japanese yen, updating local highs of August 2. At the beginning of the week, the yen is under pressure from macroeconomic data from Japan. Bank Lending slowed in August from +2.3% to +2.1% YoY. The annual GDP data for Japan in Q2 2019 showed the expected slowdown from +1.8% YoY to +1.3% YoY. On a quarterly basis, the indicator decreased from +0.4% QoQ to +0.3% QoQ. Eco Watchers Survey Outlook in August fell from 44.3 to 39.7 points, which turned out to be worse than the average expectations. In turn, Eco Watchers Current Index for the same period increased from 41.2 to 42.8 points. Oil Oil prices showed moderate growth on Monday after Saudi Arabia announced the replacement of the current Minister of Energy by Prince Abdulaziz bin Salman, who is part of the OPEC delegation. The markets hope that such a step will further develop relations between the countries that are members of the cartel, which is especially important now that information has appeared on the excess of the agreed oil production limits by some parties to the agreement. Another positive factor for the instrument was the growth of China's oil imports in August by 3% MoM. Today, investors are focused on the American Petroleum Institute Weekly Crude Oil Stock report as of September 6.
  10. USD/CHF: the dollar is strengthening 2019-09-09 08:53 (GMT+2) USD/CHF Current trend The USD/CHF pair continues to grow moderately, recovering to local highs of September 3. However, a report on the US labor market published last Friday turned out to be ambiguous, which caused a short-term correction of the US currency. Nonfarm Payrolls for August rose by 130K, which turned out to be noticeably worse than forecasts of 157K. Wages also slowed from +3.3% YoY to +3.2% YoY with a forecast of +3.1% YoY. Today, during the Asian session, the instrument is trading with a fairly confident increase. On Monday, there is a lack of key US statistics to be published, so European data will be in the spotlight. In Switzerland, a report on the unemployment rate for August will be released. Analysts expect the indicator to remain around 2.3%. Support and resistance On the daily chart, Bollinger bands are actively growing. The price range is slightly expanding from above, letting the “bulls” renew local highs. MACD indicator restores the upward trend, forming a new buy signal (the histogram consolidates above the signal line). The dynamics of Stochastic is similar, it reversed upwards. Current indicators do not contradict the further development of the uptrend in the short and/or ultra-short term. It is better to keep the current long positions in the nearest time intervals. Resistance levels: 0.9905, 0.9927, 0.9945. Support levels: 0.9876, 0.9858, 0.9835, 0.9797.
  11. Morning Market Review 2019-09-06 08:46 (GMT+2) EUR/USD Yesterday, the EUR/USD pair was trading ambiguously, closing around the zero level. During the day, the European currency moved upward, supported by news around the trade conflict between the United States and China. After lengthy attempts, the parties agreed to start a new phase of bisideways negotiations, which will be held in Washington early in October. The market is not sure if the upcoming discussions will be successful, however, given the long-term deterioration of the situation in this area, the news is a powerful “bullish” factor. In turn, the euro was under pressure of poor statistics on Factory Orders in Germany. For July, the indicator decreased by 2.7% MoM and 5.6% YoY, which was significantly worse than the data for the previous period +2.7% MoM and –3.6% YoY. Analysts were counting on –1.5% MoM and –1.1% YoY. Today, investors are focused on data on the dynamics of Eurozone GDP and the level of employment for the second quarter of this year. US investors are waiting for the August report on the labor market. GBP/USD Yesterday, the GBP/USD pair rose steadily, rising to the levels of August 28. Active growth of the instrument is also observed during today's Asian session, allowing the British currency to update local highs of July 29. GBP is supported by the decision of the British Parliament to block the possibility of Britain leaving the EU without an existing agreement. If a compromise on the terms of the agreement is not reached, Prime Minister Boris Johnson will be forced to request a new postponement until the end of January 2020. On Friday, traders are focused on the block of statistics from the UK on housing prices and the forecast for consumer price inflation. With the opening of the American session, the market is waiting for the publication of the August report on the US labor market. The ADP report on private sector employment released on the eve reflected the increase in the number of new jobs in August by 195K after an increase by 142K last month. AUD/USD The AUD/USD pair is growing within the correction, recovering to local highs of August 1. The instrument is supported provided by news on the approval of the start of a new stage of trade negotiations between the United States and China, which give hope for a positive outcome of the protracted trade war. Yesterday’s statistics from Australia did not support the price. Thus, the volume of exports from Australia in July grew by 1.0% MoM after an increase by 1.4% MoM last month. The dynamics of imports rose by 3.0% MoM after a decrease of 3.5% MoM. Such a sharp increase in imports led to a decrease in the surplus of the country's trade balance from 7977 million to 7268 million, which was worse than market forecasts of 7400 million AUD. Today, during the Asian session, the AiG Australian Construction Sector Activity Index supports the national currency. In August, the indicator rose from 39.1 to 44.6 points, exceeding the average forecasts of analysts. USD/JPY Yesterday, the USD/JPY pair rose significantly, renewing local highs of August 2. The strengthening of the instrument proceeds amid some investor enthusiasm after announcing a new round of negotiations between the US and China in early October. More confident upward dynamics were hindered by poor macroeconomic statistics from the USA. Thus, the index of business activity in the services sector from Markit for August fell from 50.9 to 50.7 points against the forecast that the indicator would stay at the same level. In turn, a similar index from ISM steadily rose from 53.7 to 56.4 points against the expected increase to 54.0 points. Today, during the Asian session, the growth of the pair is promoted by an uncertain macroeconomic background from Japan. Household spending in Japan for July slowed from +2.7% YoY to +0.8% YoY with a forecast of +1.1% YoY. The indicator of changes in the level of wages in July fell by 0.3% YoY after rising by 0.4% YoY a month earlier. Oil Yesterday, oil prices rose steadily, briefly exceeding the level of $62 per barrel. The instrument was strengthened by news around the agreement on the start of a new round of trade negotiations between the United States and China, which gave hope for an improvement in the situation with world oil demand. Additional support for quotes was provided by the report from the US Department of Energy on the dynamics of stocks of petroleum products in warehouses in the United States. For the week of August 30, oil volumes decreased by 4.771 million barrels after a decrease of 10.027 million barrels over the past period. Analysts had expected a decrease of only 2.488 million barrels.
  12. Morning Market Review 2019-09-05 08:50 (GMT+2) EUR/USD The European currency showed steady growth against the US currency on Wednesday, continuing the development of a weak "bullish" impulse formed the day before. Optimistic macroeconomic statistics from Europe supported the instrument yesterday. German Markit Services PMI rose from 54.4 to 54.8 points in August, which was better than the neutral forecast. Composite PMI for the same period increased from 51.4 to 51.7 points, also exceeding the forecast of 51.4 points. The euro area's Services PMI also showed positive dynamics. In August, the index rose from 53.4 to 53.5 points, and Composite PMI strengthened from 51.8 to 51.9 points. Additional support for the euro is provided by Fed officials' statements about the need for a more active reduction in interest rates. In particular, St. Louis Fed President, James Bullard, spoke in favor of such a decision on Tuesday. GBP/USD The British pound showed strong growth against the US dollar on Wednesday, updating local highs of August 28. The instrument was strongly supported by the decision of the British Parliament to approve a bill obliging Boris Johnson's government to request a new suspension of Brexit from the EU until January 31, 2020. The decision was made with an advantage of 28 votes and now, in order to enter into force, it must receive the approval of the House of Lords. Johnson responded to the decision of the Parliament by introducing a bill to hold early elections on October 15, but this initiative is unlikely to be implemented in such a short time. The likelihood of a hard Brexit scenario has decreased and this has provided significant support to the British currency. AUD/USD The Australian dollar continues to grow against the US currency, updating local highs of August 1. The instrument is supported by a weak macroeconomic background from the USA, which constantly reminds the market of the threats of a recession in the American economy. Investors were disappointed to find ISM Manufacturing PMI data. In August, the indicator crashed from 51.2 to 49.1 points, reaching its lowest level since 2016. Analysts had expected a decline to 51.0 points. Wednesday’s Australian statistic was neutral. Australia's GDP for Q2 2019 grew by 0.5% QoQ, which fully met the expectations. In annual terms, the growth of the Australian economy slowed down from +1.8% YoY to +1.4% YoY, but this was also expected. During today's Asian session, investors are focused on statistics on Australia's trade balance for July, which prevents a more confident growth of the instrument. The surplus of the balance in July decreased from AUD 7.977 to 7.268 billion amid a sharp increase in imports. USD/JPY The US dollar showed moderate growth against the Japanese yen on Wednesday, correcting upwards after falling the day before. Pressure on the yen is exerted by the prospects for new easing by the Bank of Japan, which was announced on Wednesday by representative of the regulator Goushi Kataoka. In addition, investors continue to monitor the tensions surrounding the trade conflict between Japan and South Korea. Services PMI for August turned out to be moderately optimistic, but failed to meet market expectations. The Jibun Bank index rose from 51.8 to 53.3 points against a forecast of 53.4 points. Oil Oil prices rose significantly on Wednesday, receiving support from strong macroeconomic publications from China, which contributed to some reduction in tensions regarding a further slowdown in the global economy. Caixin Services PMI showed an increase from 51.6 to 52.1 points. At the beginning of the week, China also reported an increase in activity in the manufacturing sector. Caixin Manufacturing PMI strengthened from 49.9 to 50.4 points, returning to growth. The report of the American Petroleum Institute reflected the growth of oil reserves for the week as of August 30 by 0.401 million barrels after a record decrease of 11.100 million barrels for the previous period. On Thursday, investors expect similar statistics from the US Department of Energy. According to current forecasts, oil reserves will show a decrease of 2.488 million barrels.
  13. Morning Market Review 2019-09-04 08:36 (GMT+2) EUR/USD The European currency showed moderate growth on Tuesday, departing from the updated local lows of May 2017. The reason for the appearance of correctional dynamics, in addition to a number of technical factors, were comments by US Fed officials regarding the prospects for a further reduction in interest rates by the regulator. James Bullard, St. Louis Fed President, said that the current level of rates remains "excessively high" and it would be better if the regulator immediately reduced it significantly, rather than doing it gradually. Later Bullard was supported by Boston Fed President Eric Rosengren, who pointed out the growing risks for the American economy. Today, EUR is trading in both directions. Investors are waiting for the publication of statistics on Services PMI from Europe. In addition, the market is awaiting the speech of Christine Lagarde, who is due to become the new ECB President from November 1, 2019. GBP/USD The British pound traded in both directions on Tuesday, managing to recover by the close of the session. During today's Asian session, the pair shows moderate growth, partially offsetting the "bearish" beginning of the current week. The pound reacted positively to news from the UK, where the majority of the House of Commons MPs voted to seize control over parliament's agenda. Parliament may now consider a bill that would oblige British Prime Minister Boris Johnson to request a new deferral of Brexit until January 31, 2020. Johnson is a staunch opponent of deferrals, so he said in response that he would push for early parliamentary elections. Today, investors expect the publication of statistics on the UK Markit Services PMI in August. Construction PMI published the day before fell from 45.3 to 45.0 points against the forecast of growth to 45.9 points. AUD/USD The Australian dollar showed strong growth against the US currency on Tuesday and continues to actively develop the "bullish" dynamics during today's Asian session. The growth of the instrument was facilitated by the publication of weak macroeconomic statistics from the US. ISM Manufacturing PMI in August declined significantly from 51.2 to 49.1 points with the forecast of 51.1 points. Today, the pair is supported by released data from Australia and China. Australia's GDP in Q2 2019 grew by 0.5% QoQ, which coincided with the estimates. In annual terms, the Australian economy slowed down from +1.8% YoY to +1.4% YoY, which also came as no surprise. At the same time, the AiG Services Index in August rose significantly from 43.9 to 51.4 points. Chinese data reflected an increase in Caixin Services PMI in August from 51.6 to 52.1 points. USD/JPY The US dollar showed a decline against the Japanese yen on Tuesday, reacting to the publication of weak macroeconomic statistics from the US. During today's Asian session, the instrument is trading in both directions, responding to comments by US Fed officials who spoke out in favor of a possible aggressive reduction in interest rates in the near future. Japanese statistics provide moderate support for the yen. Markit Services PMI rose from 51.8 to 53.3 points in August, which was only 0.1 points worse than expectations. Oil Oil prices showed a moderate decline on Tuesday, but managed to correct closer to the end of the afternoon session. Pressure on quotes was exerted by the fact that oil production by OPEC members and the Russian Federation increased, which cast doubt on the relevance of the current agreement on limiting production volumes. In addition, investors remain concerned about the development of the US-China trade conflict. Earlier, Donald Trump said that the parties are ready to return to the negotiations, but the date for their resumption has not yet been set. Today, investors are awaiting the release of API Weekly Crude Oil Stock report, the publication of which was delayed by one day due to the celebration of Labor Day in the United States.
  14. Morning Market Review 2019-09-03 08:48 (GMT+2) EUR/USD The EUR/USD pair continues to decline, renewing record lows since May 2017. EUR is under pressure amid worsening of the global economic outlook. In particular, investors are seriously concerned about the further escalation of the US-China trade conflict, which could lead to a slowdown in global economic growth. However, the parties agree to return to the negotiating, and the market expects the start of a new round in September. Yesterday’s EU macroeconomic statistics was ambiguous. Thus, Markit Manufacturing PMI in France increased from 51.0 to 51.1 points, while the same indicator in Italy rose from 48.5 to 48.7 points. However, the index in Germany fell from 43.6 to 43.5 points again. In general, EU PMI remained at the previous level of 47.0 points. GBP/USD Yesterday, the GBP/USD pair fell steadily, retreating to local lows since August 12. Despite the closed markets in the United States on the occasion of Labor Day, GBP remained under pressure due to the publication of poor UK macroeconomic statistics. So, Markit Manufacturing PMI in August fell from 48.0 to 47.4 points, while analysts' forecasts predicted an increase to 48.4 points. Another negative factor for the price is the prospect of a hard Brexit. The Queen of the United Kingdom approved the plan of Prime Minister Boris Johnson to extend the vacation for the British Parliament until mid-October, which will significantly hinder the adoption of a bill banning the country's exit from the EU without a deal. It is predicted that such a bill could be introduced today. AUD/USD AUD is actively falling against USD, renewing local lows since August 26. The development of the “bearish” dynamics, as before, is due to the growth of tension in the market. Last Sunday, China and the United States exchanged mutual import duties, which will negatively affect the dynamics of the world economy in the near future. At the same time, macroeconomic statistics published on Monday moderately supported the instrument. Thus, AiG Manufacturing PMI in Australia in August rose from 51.3 to 53.1 points. The Chinese Caixin Manufacturing PMI over the same period increased from 49.9 to 50.4 points against the forecast of 49.8 points. Today, during the Asian session, the pair is also trading in a downward direction. Investors are waiting for the publication of the RBA decision on the interest rate but do not count on any changes in the monetary policy vector. USD/JPY USD has been growing moderately against the JPY since the beginning of the current trading week, approaching the local highs, renewed on August 29. The development of upward dynamics is facilitated by corrective sentiment in USD, as well as the publication of poor macroeconomic statistics from Japan at the beginning of the week. Thus, the volume of Q2 2019 Capital Spending in Japan increased by 1.9% QoQ, slowing down against the previous growth rate of +6.1% QoQ. Nikkei Manufacturing PMI in August fell from 49.5 to 49.3 points, remaining in the stagnation zone. Today, investors are awaiting the publication of a block of macroeconomic statistics on business activity in the United States. Oil Yesterday, oil prices fell slightly, weakening the “bearish” momentum formed at the end of last week. The development of negative dynamics is due to the aggravation of the trade conflict between the United States and China after the introduction of mutual import duties on September 1. Also, the market expects the start of a new round of trade negotiations at the end of September, as Donald Trump has repeatedly stated. China also welcomes the opportunity to solve the problem through negotiations but continues to insist on the abolition of part of import duties imposed by Washington earlier. Today, investors are focused on the report of the American Petroleum Institute for Oil Reserves. The previous report reflected a sharp decline in oil reserves by 11.1 million barrels, which was later confirmed by an official report from the US Department of Energy.
  15. Morning Market Review 2019-09-02 08:40 (GMT+2) EUR/USD The European currency fell significantly against the US dollar on Friday, updating record lows of mid-May 2017. The pressure on the instrument intensified at the end of last week amid the publication of disappointing macroeconomic statistics from Europe. Retail sales in Germany showed a decrease of 2.1% MoM in July after rising by 3.0% MoM last month. Analysts expected a decline of –1.3% MoM. The EU Core Consumer Price index in August remained at the previous level of +0.9% YoY, while investors expected it to accelerate to +1.0% YoY. Thus, inflation in Europe continues to remain significantly below the ECB target levels, forcing the latter to act more aggressively. A number of analysts believe that the European regulator may resort to new stimulation measures already at the September meeting. In particular, the market does not exclude the possibility of resuming the quantitative easing program. GBP/USD The British pound showed a moderate decline against the US dollar at the end of last week, continuing the development of the "bearish" impulse formed on August 28. The pound is still under pressure due to the aggravation of the domestic political situation in the UK amid the approach of the Brexit deadline. British Prime Minister Boris Johnson asked the Queen for permission to extend the Parliament summer recess until mid-October, so that they would not be able to pass a bill prohibiting the country from leaving the EU without a valid agreement. Members of the opposition parties said they would try to meet the deadlines. However, official statements often contain calls to declare a vote of no confidence in the government. At the end of last week, moderate support to the pound was provided by data on consumer lending. Net Lending to Individuals in July increased from 4.8 to 5.5 billion pounds. Mortgage Approvals in July rose from 66.51K to 66.26K, which also exceeded the market expectations of 66.17K. AUD/USD The Australian dollar maintains a moderate downtrend against the US currency, again approaching local lows of August 26. Pressure on the instrument is exerted by the uncertain situation surrounding the US-Chinese trade negotiations, which may resume in September, but, according to many analysts, are unlikely to lead to a noticeable improvement in the situation. Meanwhile, the parties introduced mutual import duties on September 1, which may already negatively affect the growth rate of the global economy. During today's Asian session, the instrument is trading in both directions. US markets are closed due to Labor Day, so the Australian dollar has a chance of correction. Moderate support for the instrument is provided by macroeconomic statistics from Australia and China. AiG Manufacturing index went up from 51.3 to 53.1 points in August. Terms of Trade index in Q2 2019 rose from 1.0% to 1.6%. Caixin Manufacturing PMI in August rose from 49.9 to 50.4 points, exceeding the forecast of 49.8 points. USD/JPY The US dollar showed a moderate decline against the Japanese yen last Friday, interrupting the development of a "bullish" impulse formed in the middle of the week. The yen was supported by macroeconomic data from Japan published on August 30. The unemployment rate in July fell from 2.3% to 2.2%, while the market expected its growth to 2.4%. Industrial production in July grew by 1.3% MoM and 0.7% YoY, which was significantly better than market expectations. During today's Asian session, the dollar is trading with an increase. The yen is under pressure from Nikkei Manufacturing PMI, which reflected a further decline in business sentiment. In August, the index fell from 49.5 to 49.3 points. Oil Oil prices showed a negative trend on Friday after moderate growth throughout the past trading week. The quotes decreased against the background of the corrective growth of the American currency, as well as due to published data from Reuters, which indicated an increase in oil production by OPEC. In August, production increased by 80K barrels, showing growth for the first time in 2019. A more confident negative dynamics in the instrument at the end of the last trading week was hindered by the published Baker Hughes report, which reflected a decrease in the number of active drilling rigs over the week as of August 30 from 754 to 742 units. Additional support for quotes is provided by Hurricane Dorian, which last weekend intensified to the highest category and reached the Bahamas, and this night can reach the coast of Florida.
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