Date : 30th July 2020. US GDP & Claims data. EURUSD, H1 The US advance GDP report beat estimates with a -32.9% Q2 contraction rate that was a modestly smaller drop than feared, though it still constituted a record drop, following annual revisions that raised the real and nominal GDP levels as of Q1, but left the chain price index the same. For revisions, the -5.0% Q1 real GDP figure was left unrevised, though the prior two quarterly gains were raised to 2.4% (was 2.1%) in Q4 and 2.6% (was 2.1%) in Q3, hence leaving a stronger trajectory into Q2. There were plenty of Q2 component surprises, with the big upside surprise coming from a much weaker than assumed real import figure, where we saw a -53.4% decline (import drops add to GDP), alongside an expected -64.1% export drop. We also saw a surprising 2.7% rise for real government purchases, instead of the widely assumed drop. The Q2 inventory figures posted the expected huge liquidation, with a -$234.6 bln inventory subtraction that left a record-large liquidation rate of -$315.5 bln. We saw more modest downside Q2 surprises for the investment figures, with a -27.0% contraction rate for business fixed investment and a -38.7% for residential investment. Consumption fell -34.6% in Q2, which was a tad weaker than we assumed but was in line with market estimates. Today’s GDP and claims data prompted tentative bumps to GDP forecasts to 28.0% (was 31%) in Q3 and 9.0% (was 7.5%) in Q4, and a trimming of the July non-farm payroll estimate to 2.6 million from 3.3 million. The Dollar was unchanged following the data, where Q2 GDP fell a historic 32.9% and jobless claims rose another 1.434 mln versus the 1.422 previously. EURUSD sits near 1.1790, having spiked over 1.1800, and the USDJPY is steady at 105.15. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer:This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Date : 31st July 2020. Sterling Storms On. GBPUSD, H1 Cable has pinned a new five-month peak at 1.3145. The pair is now firmly back in pre-lockdown territory. The UK currency still registers as the weakest of the main currencies on the year-to-date, and by some distance in trade-weighted terms, while recent dollar underperformance has been somewhat flattering the Pound. Nevertheless, there are some convincing bullish arguments in market narratives. One is the pick-up in the pace of economic recovery in the UK, as evidenced by the much stronger than forecast preliminary July PMI data and improvement in the CBI’s July distributive sales report, which flagged a near full recovery in the retail sector, with sales in upcoming months seen at near seasonal norms. There have also been signs that have led markets to factor in improved odds for an EU-UK trade deal, with a number of sourced press reports suggesting that discussions are going better than the official line suggests. However, the Government’s handling of the pandemic has been coming under daily scrutiny and last night’s sudden announcement of restrictions and lock-downs in parts of northern England only added to the uncertainty. Technically, Cable breached the key 20-day simple moving average on July 7 and has rallied significantly over the last 11 trading days, posting consecutive gains each day. The next Donchian Channel top is 1.3200 and then 1.3500. The 200-day moving average sits way below at 1.2688 and the RSI has breached into the 80s this week into overbought territory. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Date : 6th August 2020. FX Update – August 6 – USD to new lows. Trading Leveraged Products is risky The USDIndex edged out a fresh 27-month low at 92.50, continuing what is a fourth consecutive week of decline and a fourth straight month of decline, dropping by just over 10% from the early March peak. The loss of confidence in the US currency has partly been reflected in the ongoing rally in gold, which has remained buoyant after posting a fresh record nominal high at $2,055.00 yesterday. A deal on the US fiscal package remains elusive, though President Trump’s threat to take executive action to cut payroll taxes managed to keep investor spirits up, along with the above-forecast services ISM out of the US, and more positive news from the candidate vaccine front for the SARS Cov-2 coronavirus. The good vibe across equity markets flagged somewhat as the Asia session wore on, however. The MSCI Asia-Pacific equity index printed a six-and-a-half-month-high during early trading before turning lower to near net unchanged levels. S&P 500 futures, while off highs, still show moderate gains, while the European markets have opened lower to start the day. AUDUSD saw a downward flurry after the Australian government lifted its unemployment forecast while forecasting growth would be trimmed by 2.5 percentage points as a consequence of its own lockdown measures (having chosen the sledgehammer approach, similar to many other nations, despite the standout success of the much less costly Swedish approach, which has refrained from lockdown and masks and has performed near the same as most other European countries during the pandemic, with its ICU and mortality numbers having now dropped to near nothing). AUDUSD dipped to a 0.7184 low, which is nearly 60 pips below yesterday’s peak. Elsewhere, EURUSD edged out a new 27-month high at 1.1917, and Cable a five-month peak at 1.3182. USDJPY idled in the mid 105.00s, above yesterday’s six-day low at 105.32. USDCAD settled above the six-month low seen yesterday at 1.3231. Front-month USOIL crude futures settled in the lower $42.00s, below Wednesday’s five-month peak at $43.52. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Date : 7th August 2020. FX Update – Ahead of NFP, USD finds a bid. The narrow trade-weighted USDIndex (DXY) posted a two-day high at 93.16, extending the rebound from the 27-month low seen yesterday at 92.53. EURUSD concurrently retreated to a 1.1819 low, which is a pip shy of yesterday’s low and 2 pips shy of making it a big figure correction from yesterday’s 27-month peak. Cable posted a two-day low at 1.3098, drawing back from the 1.3187 five-month peak seen Thursday following the warily upbeat BoE outlook. USDJPY continued to ply a narrow range (less than 15 pips) around the 105.50 mark. Both the Aussie and Kiwi Dollars corrected moderately as the US currency firmed. AUDUSD, after first edging out a high at 0.7243, which matches Wednesday’s 18-month peak, ebbed to a low at 0.7196. USDCAD lifted to a three-day high at 1.3372. Front-month USOil futures were soft for a second day, maintaining sub-$42.00 levels after posting a five-month high earlier in the week at $42.52. Gold prices corrected below $2,050.00 after printing a fresh nominal record high at $2,077.85. The ascent of gold has been a reflection of investor concerns over the risk of there being an eventual pop in inflation as a consequence of massive global fiscal stimulus efforts and massive global monetary uber-accommodation, although there has been scant sign of this happening thus far, with disinflation remaining in force and with much of the US yield curve and other sovereign benchmark yields either at or near record lows. In the mix is speculation that the Fed, and possibly other major central banks, may be amid a strategic shift to allow higher inflation. The US Department of Labor’s weekly initial jobless claims will be THE key data release from the US later today, while labor market reports from Canada and the United States will be closely watched by market participants. The median forecast of economists polled by Reuters is for the Non-Farm Payroll to rise by 1,600,000, following the big miss in ADP number of 167,000 on Wednesday and the better than expected Weekly Claims yesterday of 1,186,000 compared to expectations of 1,400,000. The range in the Reuters poll estimates varies from -280,000 to 3,500,000. On the other hand, Canada is expected to add 400,000 jobs with the Unemployment Rate slumping lower to 11% from 12.3%. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Date : 10 August 2020. Events to Look Out for This Week. As the month of August began,uncertainties both fresh and familiar keep challenging the markets, driving volatility in the stock market and pushing bond rates to record lows. The worries over the second wave of the viral pandemic, US-China frictions, the government’s inability to pass a new US stimulus bill and the whatever-it-takes policy commitments from the core central banks all expected to hold in the week ahead as well. Have a look at the most important events of the coming days in our usual weekly publication. Monday – 10 August 2020 Consumer Price Index (CNY, GMT 01:30) – The July Chinese CPI is expected to have improved on a monthly basis, with higher outcome at 0.2% m/m from -0.1% m/m Tuesday – 11 August 2020 Average Earnings (GBP, GMT 08:30) – Average Earnings excluding bonus are expected to have grown by 0.4% in June from 0.7%. The ILO unemployment rate is expected to be unchanged at 3.9%. Economic Sentiment (EUR, GMT 09:00) – German August ZEW economic sentiment is seen to have inclined at 62.4 compared to 59.3 in July. Producer Price Index (USD, GMT 12:30) – The headline CPI for PPI in July is expected with a 0.4% gain with a 0.1% core price increase. As expected readings would result in a rise for the y/y headline PPI metric to -0.7% from -0.8% in June. The y/y core reading is assumed to remain in the 0.2%-0.5% area over the near future, with the downward hit from reduced aggregate demand proving greater than the boost for prices from supply disruptions, though supply constraints for some sectors should prove increasingly important as we pass through Q3. Wednesday – 12 August 2020 Interest Rate Decision & Policy Report (NZD, GMT 02:00) – The Reserve Bank of New Zealand (RBNZ) is widely expected to keep the OCR (Official Cash Rate) at the current record low 0.25%. The OCR is the means by which the RBNZ manages a dovish monetary policy for the New Zealand economy, by lending overnight cash at 25 basis points above the OCR, and receiving deposits and paying interest at 25 basis points below the OCR. The bank expected to expand QE, when the Bank’s bimonthly monetary policy statement and press conference are also scheduled, since last time it stressed a willingness to take further stimulus measures if necessary while noting persisting downside risks to the economy, adding that currency strength remains a negative for NZ exporters. Gross Domestic Product (GBP, GMT 06:00) – GDP is the economy’s most important figure. The preliminary Q2 GDP is expected to slightly improved at -1.8% q/q however it remains contracted in a quarterly and yearly basis. Consumer Price Index (USD, GMT 12:30) – The headline CPI for July is expected at a 0.3% July and with a 0.1% core price rate, following June figures of 0.6% for the headline and 0.2% for the core. The headline will be boosted by an estimated 5% July increase for CPI gasoline prices. As-expected July figures would result in a headline y/y increase of 0.7%, up from 0.6% in June. Thursday – 13 August 2020 Employment Data (AUD, GMT 01:30) – Both the unemployment rate and the employment change are expected to have grown in July, at 7.8% m/m and 394.2K respectively. Harmonized Index of Consumer Prices (EUR, GMT 06:00) – The German HICP inflation for July is anticipated flat. Friday – 14 August 2020 Retail Sales (CNY, GMT 02:00) – Following the -1.8% m/m contraction in China retail sales in June, they are expected to rise slightly by 0.3% in July. Gross Domestic Product (EUR, GMT 09:00) – The preliminary Q2 GDP s.a. is expected to remain contracted at -15.0%y/y and -12.1% q/, with national GDP rates varying pretty much along the lines of virus developments and depending and the extend of lockdown measures. The key question for the future is when the initial rebound will be, but if that can be sustained and broadened into a lasting recovery even when governments and ECB start to reign in their very generous support. The agreement on an EU wide stimulus package has helped to bolster confidence in the project, but it remains to be seen whether the package really is sufficient to strengthen long term growth in the Eurozone. Retail Sales (USD, GMT 12:30) – July increases of 1.0% for headline retail sales is expected and 0.8% for the ex-auto figure, following June increases of 7.5% for the headline and 7.3% ex-autos. We expect a 5% increase for the CPI gasoline index, and rising sales volume as well should allow a 5% service station sales rebound as well. Real consumer spending is expected to contract at a rate of -33.2% in Q2 before an assumed 33% bounce in Q3. Michigan Consumer Sentiment Index (USD, GMT 14:00) – The August preliminary Michigan sentiment reading is forecast at 79.0, from 72.5 in the final July reading. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Andria Pichidi Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Date : 13th August 2020. FX Update – August 13 – Weaker Dollar & Stronger Sterling. The Dollar is down for a second day, with the narrow trade-weighted USDIndex printing a six-day low at 93.08 to nearly fully unwind the gains seen in the wake of last Friday’s US July jobs report, when we printed an eight-day high at 93.87. Some market narratives have been attributing the Dollar’s ebb as being a return of the currency’s inverse correlation with stock market direction, along with the perception that the Fed has strategically dropped its concern about inflation risk, which has driven real US yields into negative territory. These factors appear to be outweighing the improvement in the US economy and downward trend in new coronavirus cases. As for Washington’s tensions with Beijing, this hasn’t been much of a concern for Wall Street, with most onlookers anticipating this weekend’s meetings to review progress on the Phase 1 trade deal will go well, even though China has been lagging behind in its purchases of US farm and energy goods. Among the main Dollar pairings, EURUSD climbed to a six-day high at 1.1838, putting the 27-month high seen last Thursday at 1.1917 back in the scopes. USDJPY extended a moderate correction from yesterday’s three-week high at 107.03, posting a low at 106.57. The Yen was more mixed against other currencies, with EURJPY remaining buoyant, just off the 16-month high that was pegged yesterday at 126.23, while AUDJPY traded softer after the cross peaked at a three-week high yesterday. The Nikkei 225 hit a six-month high, which followed a strong close on Wall Street yesterday, with the S&P 500 finishing just a whisker below a record closing peak. European stocks have opened lower with GER30 holding over 13,000 at 13,025 and the UK100 trades down around 6,200. AUDUSD edged out a two-day peak at 0.7188. Australian July employment data showed a forecast-smashing 114,700 rise in the headline, while the June figure was revised higher, though lockdowns across the country are now blighting the immediate outlook. USDCAD settled just above Wednesday’s six-month low at 1.3227. Sterling is trading mixed, edging out a two-day high at 1.3092 against the Dollar, while also gaining on the Yen and Aussie Dollar, but holding steady-to-softer versus the Euro and some other currencies. Yesterday’s preliminary UK Q2 GDP data showed a gargantuan 20.4% q/q contraction to confirm the technical definition of recession following Q1’s 2.2% shrink. The data wasn’t a surprise given the lockdown that was in place to varying degrees throughout the quarter. June GDP rose by 8.7% m/m, however, with June production data showing a robust rebound and beating expectations in the main headline readings, while high frequency data and a myriad of anecdotal evidence point to a strong rebound in the current quarter. The government’s furlough scheme has greatly limited the impact on the employment market. We have been talking down the Pound, to a degree, having seen limited scope for the currency to sustain its recent patch of outperformance. The BoE last week delivered a warily-upbeat outlook, though with localized lockdowns and most media doing their utmost to maintain maximum fear of a second wave of coronavirus infections, we take a circumspect view of the outlook over the coming months, anticipating a plateauing in economic rebound momentum. Manchester, Preston, Bradford and Aberdeen are back in lockdown and there is a number of new travel restrictions with other countries. The furlough scheme will end in late October, which is likely to trigger a wave of job losses, particularly in the airline, retail and hospitality sectors. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Date : 14th August 2020. FX Update – August 14 – USD Consolidates at lows. EURUSD, H4 The main currencies have settled in narrow ranges, with the Dollar consolidating above yesterday’s lows after a two-day decline. The USDIndex (DXY) has steadied in the lower 93.0s, above yesterday’s one-week low at 92.93. EURUSD has concurrently reached a stasis in the lower 1.1800s, below Thursday’s one-week peak at 1.1865. The pair has been in a strong uptrend since early May, producing last week’s 27-month high at 1.1917, though upside momentum has flagged over the last two weeks. The advent of the 750 bln Euro recovery fund and the fact that Europe has come through the pandemic ahead of the US have been underpinning EURUSD, along with the perception that the Fed is strategically being less attentive to inflation risks, which pushed real Treasury yields deep into negative territory. This dynamic looks to be shifting in certain aspects, which may curtail EURUSD’s uptrend. New coronavirus cases are dropping in sun states as community immunity builds up, having already done so in other parts of the US, while high frequency data and the July employment report are evidencing rebounding economic activity. Elsewhere today, USDJPY has been plying a narrow range below yesterday’s three-week high at 107.06. Cable has settled near 1.3050, holding well within the broadly sideways range that’s been seen over the last week. Ditto for AUD-USD, which has been making time near the 0.7150 mark. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Events to Look Out for This Week. As the month of August moves into week 3, uncertainties both fresh and familiar keep challenging the markets, driving volatility in the bond market as rates bounce off record lows and stock markets consolidate. The cooling worries over the second wave of the viral pandemic, and continuing US-China frictions, even as talks are due to resume and the impasse over a new US stimulus bill all expected to hold in the week ahead. Have a look at the most important events of the coming days in our usual weekly publication. Tuesday – 18 August 2020 Meeting Minutes (AUD, GMT 01:30) – No surprises from the RBA in their last meeting are expected, the cautious “do all we can” prose is likely to continue. Lowe talked of interest rate hikes not being on the cards for at least 3 years this week. Building Permits & Housing Starts (USD, GMT 12:30) – Permits are expected to show a rise to 1.30 million form 1.258 million last month whilst Starts are expected to decline from 1.186 million to 1.70 million, overall this would still show a resilient US housing market. Wednesday – 19 August 2020 FOMC Minutes (USD, GMT 18:00) – The Federal Open Market Committee minutes ability to shock have lost the power they once had, however, they remain the key documented account of the discussions that take place (on-line) between the decision makers of the FED. Watch for the tone of the talk of recovery, any reference to negative interest rates (even a reference would be something), the spectre of inflation and the on-going issues with the yield curve. Consumer Price Index (GBP, GMT 06:00) – The headline CPI for July is expected at a 0.6% July (y/y) and with a 1.4% core price rate, following June figures of 0.6% for the headline and 1.1% for the core. OPEC – JMMC Meeting (All Day) Thursday – 20 August 2020 US Weekly Claims (USD, GMT 12:30) – Following last week’s final breach of 1.0 million this week claims data will be eagerly watched to see if the decline continues. German Consumer Confidence & PPI Data (EUR, GMT 06:00) – The German PPI & Consumer confidence will provide another key indicator to the recovery in German sentiment and prices. Last week the COVID cases showed a worryingly geographically widespread spike. Friday – 21 August 2020 Markit PMI Composite (EUR, GMT 07:30) – expected to show a decline to 50.3 from 54.9 last time UK Markit Services PMI (GBP GMT 08:30) – expected to show a decline from last month’s 56.5 to 55.9. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer:This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Date : 18th August 2020. FX Update – August 18 – Dollar in the Doldrums. USDIndex, H4 & Monthly The Dollar has continued to weaken, which pushed the USDIndex (DXY) to a new 27-month low at 92.30. EURUSD correspondingly rose to a 12-day peak at 1.1943, and another 27-month peak. Cable rallied by 0.5% in making a 5-month high at 1.3198, while EURGBP reversed most of the gains it saw yesterday in making a 0.9035 low. AUDUSD pegged an 6-month high at 0.7252, and USDCAD descended to a 7-month low at 1.3155. Aside from the generally softer US Dollar, the Canadian currency has been buoyed by continued perkiness in oil prices. Yesterday the OPEC+ group said there was near full compliance on supply quotas amount members, lifting front-month WTI crude futures to a $42.99 peak, which is just over 50 cents shy of the five-month peak that was clocked in early August. In the mix has been a measure of Yen outperformance, with USDJPY ebbing to a 12-day low at 105.41 while EURJPY and AUDJPY drifted to respective six- and four-day lows, although both recouped losses during the London AM session. In stock markets, yesterday’s tech-led rally on Wall Street inspired the MSCI Asia-Pacific index to rally to near to its pre-pandemic January high, while Europe’s STOXX 600 was showing a moderately 0.3% gain in early PM trading. The White House announced yesterday further restrictions on China’s Huawei, which are aimed at limiting the company’s access to commercially available chips and which has the potential to disrupt global supply chains. President Trump, meanwhile, stated that China is meeting its obligations under the Phase 1 trade deal, although a review of the deal has been delayed. Beijing announced that it will be making an anti-dumping inquiry on Australian wine imports. In focus is tomorrow’s publication of the minutes from the recent FOMC meeting, which comes amid market speculation that the Fed may adopt an average inflation target, specifically with the aim of pushing inflation above the 2% target. This has been a Dollar negative, as it has driven real Treasury yields deep into negative terrain. US Equity markets have opened in positive tones on the back of strong quarterly earnings from key retailers Walmart and Home Depot, USA30 trades at today’s pivot point at 27,855, USA100 sits at 11,338 and the USA500 tests intra-day all-time highs at R1 level at 3391. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Date : 18th August 2020. FX Update – August 18 – Dollar in the Doldrums. USDIndex, H4 & Monthly The Dollar has continued to weaken, which pushed the USDIndex (DXY) to a new 27-month low at 92.30. EURUSD correspondingly rose to a 12-day peak at 1.1943, and another 27-month peak. Cable rallied by 0.5% in making a 5-month high at 1.3198, while EURGBP reversed most of the gains it saw yesterday in making a 0.9035 low. AUDUSD pegged an 6-month high at 0.7252, and USDCAD descended to a 7-month low at 1.3155. Aside from the generally softer US Dollar, the Canadian currency has been buoyed by continued perkiness in oil prices. Yesterday the OPEC+ group said there was near full compliance on supply quotas amount members, lifting front-month WTI crude futures to a $42.99 peak, which is just over 50 cents shy of the five-month peak that was clocked in early August. In the mix has been a measure of Yen outperformance, with USDJPY ebbing to a 12-day low at 105.41 while EURJPY and AUDJPY drifted to respective six- and four-day lows, although both recouped losses during the London AM session. In stock markets, yesterday’s tech-led rally on Wall Street inspired the MSCI Asia-Pacific index to rally to near to its pre-pandemic January high, while Europe’s STOXX 600 was showing a moderately 0.3% gain in early PM trading. The White House announced yesterday further restrictions on China’s Huawei, which are aimed at limiting the company’s access to commercially available chips and which has the potential to disrupt global supply chains. President Trump, meanwhile, stated that China is meeting its obligations under the Phase 1 trade deal, although a review of the deal has been delayed. Beijing announced that it will be making an anti-dumping inquiry on Australian wine imports. In focus is tomorrow’s publication of the minutes from the recent FOMC meeting, which comes amid market speculation that the Fed may adopt an average inflation target, specifically with the aim of pushing inflation above the 2% target. This has been a Dollar negative, as it has driven real Treasury yields deep into negative terrain. US Equity markets have opened in positive tones on the back of strong quarterly earnings from key retailers Walmart and Home Depot, USA30 trades at today’s pivot point at 27,855, USA100 sits at 11,338 and the USA500 tests intra-day all-time highs at R1 level at 3391. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
