Daily Market Analysis by CapitalStreetFX

[CSFX.Support]

USD/ZAR signal by Capital Street FX

USD/ZAR signal by Capital Street FX

From GMT 19:45 17/11/2016
Till GMT 21:00 17/11/2016

Buy at 14.32500
Take profit at 14.50000
Stop loss at 14.23000

 

[CSFX.Support]

Daily Report on November 18, 2016 by Capital Street FX


Daily Report on November 18, 2016



Most Asian stock markets turned higher on Friday, tracing gains of the U.S. shares overnight. At the close in NYSE, and the NASDAQ Composite index soared 0.62% and the Dow Jones Industrial Average edged 0.1% higher. The benchmark S&P 500 index added 0.39%, heading closer to its record high on Thursday. While consumer discretionary sectors got a boost from positively economic data and earnings, bank stocks were fueled by prospect of higher interest rates.

The U.S. dollar surged to a 13-1/2-year high after U.S. Federal Reserve Chair Janet Yellen, who testified on the economic outlook before the congressional Joint Economic Committee on Thursday, bolstered the case for raising interest rates next month. Yellen indicated little had changed following the victory of Donald Trump U.S. presidential election earlier this month, and added that she would serve out her full term, which ends in 2018.

Oil prices ticked lower on Friday, but looking set to finish the week higher. The strength in the greenback is contemporarily overshadowing expectations of an OPEC agreement to curb crude production. However, focus will be on the informal meeting of the cartel in Doha this weekend where at least 11 OPEC members will gather in an attempt to finalize the deal reached this September to cut or freeze oil output.

Elsewhere, Mexico's central bank on has raised its key rate 50 basis points (bps) to 5.25 percent, the highest level since May 2009. The Banco de Mexico warned that the outcome of the U.S. election had cast doubt on the relationship between two countries. In his presidential campaign, Trump did threaten to unwind a free trade deal with Mexico and block the money sent home by migrants to pay for a border wall. The victory of Trump on November 8th had sent the Peso to its record low level, which marked the biggest two-day loss of the currency since the historic devaluation in 1995.



Technicals

GBPCHF



Fig: GBPCHF H4 Technical Chart

GBPCHF has broken out of the trading range from 1.24000 to 1.25140. The pair has been powered by the short-term MA20 and is likely to test the 23.6% level at 1.26160. While RSI chart indicates an overwhelmingly bullish force, ADX also shows a wide gap between +DI and –DI lines.

Trade suggestion

Buy Stop at 1.25400, Take profit at 1.26100, Stop loss at 1.25000.



AUDNZD



Fig: AUDNZD H4 Technical Chart

AUDNZD extended its slide to the third consecutive day. The pair is approaching the 23.6% level at 1.04790. The pair has been under downward pressure from two MAs which may help the price to breach the 23.6% handle as this is not a firm handle. The price may find its support at around 1.04500.

Trade suggestion

Sell Stop at 1.05000, Take profit at 1.04500, Stop loss at 1.05250



BRENT



Fig: BRENT H4 Technical Chart

Brent crude retreated from the 23.6% Fibonacci retracement and has broken below the support at 46.00. The commodity price action has also crossed over both short-term and long-term MAs, suggesting a reversal into a downtrend. RSI that moved past the average line supports the case for Brent crude to fall deeper.

Trade suggestion

Sell Stop at 45.80, Take profit at 45.00, Stop loss at 46.25



NASDAQ 100



Fig: NASDAQ 100 Index H4 Technical Chart

The U.S. benchmark NASDAQ 100 is on track to complete the double bottom pattern after the index rebounded from the low at 4675.80 (which is also the 23.6% retracement). The price has surpassed the neck level at 4778.36 to reattempt the resistance at 4880.00. The RSI index is pointing upwards, supporting further advances.

Trade suggestion

Buy Stop at 4835.00, Take profit at 4880.00, Stop loss at 4800.00

 

[CSFX.Support]

Gold Market Outlook by Capital Street FX

Gold Approaches 1200.00 Threshold, Will The Metal Bottom Out?

Gold prices plunged to the lowest level since late May on Friday, set for a second-straight week of decline as the U.S. dollar soared strongly after comments from the Federal Reserve President Janet Yellen bolstered expectations that the central bank’s key rates would rise next month.

The precious metal hit $1202.80 per ounce earlier in the session, dragged down by the rally of the greenback, which is experiencing the biggest weekly gain in a year after Fed Chair Yellen said a U.S. interest-rate hike could come “relatively soon.”

Yellen’s remarks which came on the heels of strong economic data on Thursday, which indicated U.S. jobs market is tightening and inflation is gaining traction. Although Yellen, who testified on the economic outlook before the congressional Joint Economic Committee yesterday, stated that little had changed following the victory of Donald Trump U.S. presidential election earlier this month, Trump’s pledges to administration cuts taxes and increases fiscal spending have bolstered markets’ confidence as well as the dollar.

Speculations over accelerating U.S. growth rate and inflation may prompt the Fed to make a move on its rate next month. As a result, gold has been on a decline as the prospect of higher interest rates is considered to be negative for the dollar-denominated asset, which bears no yield.

On Friday, the Dollar index, which measures the currency against a basket of six rivals, rose to 101.37, its highest level since April 2003. The index has risen over 4 percent in the last two weeks, its biggest fortnightly rise since March 2015.

Fig: GOLD D1 Technical Chart

As can be seen from the chart, gold has broken below the 50.0% retracement at 1211.11 and is heading downwards to test the lowest level since May 30th at the 1,200.00 milestone. As indicated by the RSI chart, the gold market has entered the oversold zone, signalling a potential correction. However, there is a wide gap between the +DI and -DI line. Therefore, the metal is expected to fall deeper. As it is the last session of the week, traders should be careful as buyers may take profit.

Trade suggestion

Sell Stop at 1208.00, Stop loss at 1200.00, take profit at 1212.00

 

[CSFX.Support]

AUD/USD signal by Capital Street FX

From GMT 06:30 18/11/2016
Till GMT 21:00 18/11/2016

Sell at 0.73800
Take profit at 0.73300
Stop loss at 0.74050

 

[CSFX.Support]

GBPUSD Trade Idea by Capital Street FX

Brexit Preparations Are “On track”, GBPUSD Slides Further

GBPUSD headed for closing the week lower on Friday. The British Pound, which has been weighed by a strengthening U.S. dollar, retreated for every trading day this week. The pair fell deeper after Prime Minister Theresa May on Friday said that preparations for Britain’s exit from the European Union were on schedule.

Speaking during a joint media briefing in Berlin ahead of a bilateral meeting with German Chancellor Angela Merkel, the U.K. PM May stated that her government stood ready to trigger Article 50 by the end of March next year. The legal process had been expected to be delayed by a legal decision that she must gain parliamentary approval before triggering the two-year period of negotiation.

The greenback, which has strengthened since Federal Reserve Chairwoman Janet Yellen’s testimony on Thursday, was given a fresh boost by other Fed officials today. While New York Fed President William Dudley stated that the post-election market reaction is not concerning in terms of planned interest rate rises, St. Louis Federal Reserve President Bullard said he is leaning toward supporting an interest rate increase in December.

Trade suggestion

Sell Stop at 1.23200, Take profit at 1.22800, Stop loss at 1.23400

 

[CSFX.Support]

Daily Report on November 21, 2016 by Capital Street FX

Daily Report on November 21, 2016



European shares were trading lower in the morning session after opening higher on Monday. Meanwhile, commodity prices rebounded as the dollar’s rally lost its stream. The dollar index, which measures the strength of the greenback versus a basket of major currencies, slid by 0.35% to 101.06 after soaring to the highest level since April 2003 last Friday. Dollar-dominated metals such as nickel, copper and zinc gained at least 2 percent.

Oil jumped around 1% on Monday thanks to optimism OPEC will reach a supply-cut deal later this month. OPEC was reported to move closer to its output cut agreement as Iran, which has been ramping up its crude production to regain lost market share following years of sanctions, may be given an exemption if it agrees to at least cap its output at the current level. Iranian Oil Minister Bijan Namdar Zanganeh met OPEC’s secretary-general Mohammed Barkindo in in Tehran on Saturday to discuss a proposal that offers Iran to reduce output by as much as 1.3 million barrels a day.

The euro gained more than 0.4% today after German chancellor Angela Merkel on Sunday said that she would seek re-election as chairwoman of her party and contest next year’s federal election

Elsewhere, China and New Zealand were reported to have agreed to start formal negotiations to upgrade their bilateral free trade agreement (FTA). The first round of the negotiation process would begin in the first half of 2017. China has become New Zealand's largest goods export partner with about NZ$12.2 billion ($8.54 billion) of goods and services exported to China in the year to June. An upgraded agreement could benefit both countries, especially the world's largest dairy exporter.



Technicals

USDCAD



Fig: USDCAD H4 Technical Chart

In general, USDCAD has been trading in a range from 1.34000 to 1.35700, which is also the 50% retracement. The pair has been on a slide since it reversed lower from the upper boundary and has crossed over a couple of MAs at around 1.34700, which suggests further declines. With RSI index falling below the 50 line, USDCAD is expected to retest the lower boundary.

Trade suggestion

Sell Stop at 1.34500, Take profit at 1.34000, Stop loss at 1.34750



EURUSD



Fig: EURUSD H4 Technical Chart

EURUSD has been trading sideways to higher since last Friday but a weak bullish momentum which has helped prevent the pair from falling deeper seems not strong enough to beat downward pressure from the short-term MA20. The pair is likely to reverse lower and approach the lowest level since late November 2015 at around 1.05.

Trade suggestion

Sell Stop at 1.06200, Take profit at 1.05700, Stop loss at 1.06500



Sugar



Fig: Sugar H4 Technical Chart

Sugar bottomed out near 20.00 level. The price fell off from a triangle pattern and broke below the 23.6% retracement at 20.80. As can be seen from the stochastic chart, the market has escaped from the oversold zone with the %K line and %D line heading upwards. As a result of a market correction, sugar may retest the resistance at 23.6% level.

Trade suggestion

Buy Stop at 20.45, Take profit at 20.80, Stop loss at 20.20



WTI



Fig: WTI H4 Technical Chart

WTI crude oil has breached the 23.6% again following a few failed attempts. Basically, the pair has been supported by two MAs moving below the price action. RSI index is edging higher, suggesting strengthening bullish force. The commodity price is anticipated to attempt the resistance at 47.30.

Trade suggestion

Buy Stop at 46.50, Take profit at 47.30, Stop loss at 46.00



DAX



Fig: DAX 30 H4 Technical Chart

Germany’s DAX 30 index is swinging back and forth around the 10700.00 level. The short-term MA20 has twisted with the price action, suggesting indecisive moves. However, a RSI that remains in the bullish zone indicates a market in favor of buyers which may send the price to the resistance at 10800.00.

Trade suggestion

Buy Stop at 10730.00, Take profit at 10800.00, Stop loss at 10650.00

 

[CSFX.Support]

Natural Gas Trade Idea By Capital Street FX

Colder Weather Forecasts Give Natural Gas Prices A Boost

U.S. natural gas futures extended their rally this week after having closed higher for the first time in the last five weeks. The commodity price hit the highest level since the start of this month at $2.944/Btu on Monday amid weather forecasts that showed lower temperatures in the next few weeks.

According to business weather intelligence firms, the big shift in the weather pattern that brought the first snowflakes to the U.S. over the weekend will keep a chill in the air this week too. In the next several weeks, colder weather will lower temperatures and is highly expected to provide support to an already pessimistic natural gas market.

The International Energy Agency (IEA) released its annual World Energy Outlook last week, stating that regardless of uncertainty around renewable energy and the Paris Agreement, natural gas will replace coal to play an important role in the mix of global fuels through to 2040.

Natural Gas Trade suggestion
Buy Stop at 2.935, Take profit at 3.000, Stop loss at 2.900

 

[CSFX.Support]

GBP/JPY signal by Capital Street FX

GBP/JPY signal by Capital Street FX

From GMT 18:30 21/11/2016
Till GMT 21:00 22/11/2016

Buy at 138.500
Take profit at 140.500
Stop loss at 137.500

 

[CSFX.Support]

Brent Crude Market Outlook by Capital Street FX

Buoyed By Weak Dollar and OPEC Optimism, Brent Hits Three-Week High

Brent crude took off more than 3.3% on Monday, soaring to the highest level in three weeks. The commodity price was boosted by a weakening U.S. dollar and rising speculations that the Organization of the Petroleum Exporting Countries might agree to a supply-cut deal later this month.

Speaking at a news conference in Lima after an Asia-Pacific Economic Cooperation summit on Sunday, Russian President Vladimir Putin said he sees a “high probability” that an agreement to curb oil production will be reached at the meeting in Vienna on November 30. Russia’s President added that “We will do everything that our partners from OPEC are expecting. To freeze crude production is not an issue for us”.

OPEC was reported to move closer to its output cut agreement as Iran, which has been ramping up its crude production to regain lost market share following years of Western sanctions, may be given an exemption if it agrees to at least cap its output at the current level. Other OPEC members including Iraq, Libya and Nigeria, whose exports have been restrained by violence, have also asked to be exempted from any output-cut deal.

Iranian Oil Minister Bijan Namdar Zanganeh, who met OPEC’s secretary-general Mohammed Barkindo in in Tehran on Saturday to discuss a proposal that offers Iran to reduce output by as much as 1.3 million barrels a day, claimed after the meeting that OPEC is “highly likely” to reach a final agreement to curb oil production in its Nov. 30 meeting.

Meanwhile, the U.S. dollar retreated from last week’s 13-1/2-year highs, bolstering oil price as the dollar-dominated commodity becomes more affordable for purchasers using other currencies.

Fig: Brent D1 Technical Chart

After two failed attempts to break above the 23.6% Fibonacci level last week, Brent crude has finally breached this level and also crossed over the short-term MA20. The RSI index which has surpassed 50 line confirms the uptrend. The commodity price is heading upwards to the long-term MA50 at around 48.97.

Trade suggestion

Buy Stop at 48.20, Take profit at 49.00, Stop loss at 47.80

 

[CSFX.Support]

Daily Report on November 22, 2016 by Capital Street FX

Daily Report on November 22, 2016



Asian equities advanced on Monday after U.S. stocks reached fresh records on Monday. Global stocks were boosted by rising oil and metal prices. All three U.S. stock benchmarks closed at all-time record highs at the same time, reminiscing about the strong rally in mid-August. The S&P 500 index SPX surged 0.8%, to close at a record 2,198.18. The Dow Jones Industrial Average DJIA added 0.5% to close at a record 18,956.69 and the Nasdaq Composite Index soared 0.9% to finish at 5,368.86.

Led by energy and material shares, the MSCI Asia Pacific Index of equities jumped nearly 1.0 percent. While copper headed for its highest close since July 2015, crude oil extended gains amid expectation over a production cut at next week’s meeting of the Organization of the Petroleum Exporting Countries. Over the weekend, Iran signaled optimism that OPEC will agree to a supply-cut deal and Iraq said it will offer new proposals to help bolster unity before next week’s meeting in Vienna.

On the New York Mercantile Exchange, light, sweet crude for January delivery rose 1.3%, to $48.88 a barrel while Brent crude edged 1.3% higher, to $49.54 a barrel.

In a brief clip posted to YouTube on Monday, the U.S. president-elect Donald Trump outlined his policy plans for his first 100 days in office, including withdrawing from the Trans-Pacific Partnership trade deal “from day one”. Trump called the TPP trade deal “a potential disaster for our country” and stated that he would “negotiate fair bilateral trade deals that bring jobs and industry back”.

Japan’s Prime Minister, Shinzo Abe, on Saturday warned that the TPP would be “meaningless” without US participation.



Technicals

USDCHF



Fig: USDCHF H4 Technical Chart

USDCHF has been trading in a thin range since last Thursday after the pair breached above the resistance at 1.00600. The short-term MA20 has played an important role in supporting the price. As can be seen from the ADX chart, there is a wide range between the +DI and –DI, which suggests a strengthening uptrend.

Trade suggestion

Buy Stop at 1.01200, Take profit at 1.02000, Stop loss at 1.00800



USDMXN



Fig: USDMXN H4 Technical Chart

USDMXN has been trapped between the two Fibonacci levels. After pulling back from the 23.6% retracement, the pair is heading downwards to the 38.2% handle. While the price action has crossed over two MAs from above, the RSI index is sliding, confirming the downtrend.

Trade suggestion

Sell Stop at 20.34500, Take profit at 20.14700, Stop loss at 20.40000



Natural Gas



Fig: Natural Gas H4 Technical Chart

Natural gas futures retreated from three-week highs at around 3.000 after a strong rally that sent the market into the oversold zone. As can be observed from the Stochastic chart, %K line has crossed over the %D line from above and has just escaped from the oversold area, which indicates a correction. The commodity has still been supported by two MAs. Therefore, a reversal is expected.

Trade suggestion

Buy Limit at 2.900, Take profit at 3.000, Stop loss at 2.850



NASDAQ



Fig: NASDAQ 100 index H4 Technical Chart

Nasdaq 100 index broke above the downward slopping resistance that connects lower highs since late-October. However, the benchmark is struggling at the resistance at 4880.00 as the market has reached the overbought zone, as indicated by the RSI chart. The price may fall deeper but the support at 4835.00 is within the sight.

Trade suggestion

Sell Stop at 4870.00, Take profit at 4835.00, Stop loss at 4890.00

 

[CSFX.Support]

AUD/JPY signal by Capital Street FX

From GMT 06:20 22/11/2016
Till GMT 21:00 22/11/2016

Buy at 82.000
Take profit at 82.500
Stop loss at 81.750

 

[CSFX.Support]

Copper Market Outlook by Capital Street FX

Copper Continues to Takes Off, Will There Be A Correction Soon?

Copper prices jumped 2% to a one-week high on Tuesday, powered by signs of tighter supply and renewed optimism that the world’s top two economies can sustain the metal’s demand growth.

Copper has been on a rally since late October thanks to reports that pointed to renewed acceleration of global factory activity, which suggests commodity markets are entering a cyclically stronger environment.

According to market sources, on the supply side, supply seems to be tighter than expected. As stated by a report by the International Copper Study Group, an intergovernmental industry body, global copper supply may turn to a deficit after recent periods of surplus.

In a bid to buoy the rally, the Chinese are buying up copper as a hedge against yuan depreciation. China’s yuan rebounded against the U.S. dollar but still hovered near 8-1/2-year lows. Not only has speculation over a December rate hike fueled the dollar, but Trump’s election win also helped the outlook for the greenback also remained bullish a over the past several days. To cool down the rally of metal prices in general, the Shanghai Futures Exchange said it would raise margins and trading limits on futures contracts including copper and other industrial metals.

Fig: COPPER D1 Technical Chart

Copper extended its gains to the second straight session, heading upwards to attempt the resistance at 2.5700. The rally seems limited as the market has still remained in the oversold zone. As indicated by the RSI chart which shown the index is at 75.49, a correction is much likely to happen.

Trade suggestion

Sell Limit at 2.5700, Take profit at 2.5200, Stop loss at 2.6000

 

[CSFX.Support]

USDCAD trade idea by Capital Street FX

Lifted by Retreating Crude Price, USDCAD Reverses Higher

USDCAD turned higher after two days of declines. The pair was boosted by a weaker oil price and mixed Canadian retail sales reports.

Crude oil pulled back on Tuesday, heading to close lower on concerns that Iran and Iraq – two OPEC members that are trying to get an exemption from any output-cut deal – may not be ready to agree on an OPEC output freeze agreement after prices had rose to the highest level this month on reports cartel members were moving closer to finalizing the agreement.

Also supporting the dollar versus the Loonie, Canadian retail sales missed forecast in September while the so-called core index was unchanged. According to data from Statistics Canada showed on Tuesday, auto purchases, which climbed for the first time in three months, helped retail sales rise 0.6 percent, falling short of expectations calling for an increase of 0.7%.

Trade suggestion

Buy Stop at 1.34600, Take profit at 1.35000, Stop loss at 1.34200

 

[CSFX.Support]

NZD/JPY signal by Capital Street FX

NZD/JPY signal by Capital Street FX

From GMT 07:20 23/11/2016
Till GMT 21:00 23/11/2016

Buy at 78.600
Take profit at 79.200
Stop loss at 78.300

 

[CSFX.Support]

Hewlett Packard Trade Idea by Capital Street FX

Hewlett Packard Enterprise’s Revenue Declines After Separation

Hewlett Packard Enterprise Co. reported their fiscal fourth-quarter results on Tuesday, marking its first year as an independent company after Hewlett-Packard Co. had been split into two smaller companies a year ago.

The Palo Alto, Calif.-based company, which focused on the corporate computing market selling servers, networking equipment and services, said net income in its fourth fiscal quarter fell 78% on a 7.2% revenue decline. Annual revenue was reported to reach of $50.1 billion last quarter, which was down 4% from fiscal 2015. However, HPE claimed that revenue edged 2% higher year-over-year, when adjusted for divestitures and currency.

Shares of HP Enterprise declined nearly 2% in the after-hours trading as the company also forecast earnings for the current quarter were mostly below projections on Wall Street.

Trade suggestion

Sell Stop at 22.45, Take profit at 21.00, Stop loss at 23,00

 

[CSFX.Support]

Daily Report on November 23, 2016 by Capital Street FX


Daily Report on November 23, 2016



Global shares rallied for a third consecutive day on Wednesday amid optimism economic growth is strong enough to withstand higher U.S. interest rates. The MSCI Asia Pacific excluding Japan Index gained 0.7 percent, following a 1.1 percent increase in the last session. Australia’s S&P/ASX 200 Index climbed more than 1.0 percent while the Hang Seng China Enterprises Index added 0.2 percent.

European shares rose to a four-week high after U.S. stock indexes jumped to all-time records on Tuesday. The Stoxx Europe 600 Index rose 0.2 percent in London, while the U.K.’s FTSE 100 Index also ticked higher. U.K. Chancellor of the Exchequer Philip Hammond is scheduled to deliver his “Autumn Statement” to parliament later today.

The finance minister will not only lay out the government’s first tax and infrastructure spending plans since the country’s Brexit vote in June to leave the European Union, but also announce government’s economic forecasts and budget goals.

Oil swung between gains and losses after OPEC deferred a decision on production cuts. The cartel left Vienna empty-handed as it failed to agree on how Iran and Iraq will participate in the deal to reduce output. As a result, the agreement will not be resolved until the group’s formal meeting on Nov. 30. The gloomy outlook for oil market overshadowed weekly report by the industry-funded American Petroleum Institute that U.S. crude stockpiles fell last week. On the contrary, official government data due Wednesday is anticipated to point to an increase.

The minutes from the Fed’s November meeting which are due for release on Wednesday are expected to confirm officials were creeping closer to their first rate increase in a year. Along with the Fed minutes, U.S. data on durable goods orders, jobless claims, home prices and manufacturing are due Wednesday.



Technicals

AUDJPY



Fig: AUDJPY D1 Technical Chart

AUDJPY is struggling around the 82.500 level which has forced the pair to reverse lower two times in the last two weeks. The pair is edging higher, attempting to test the resistance at 36.2% level – the highest since late-April. With RSI pointing to the oversold zone and a divergence between the +DI and –DI lines of the stochastic chart, the pair is expected to extend its gains.

Trade suggestion

Buy Stop at 82.600, Take profit at 83.500, Stop loss at 82.000



GBPCHF



Fig: GBPCHF H4 Technical Chart

GBPCHF has been on a decline since it reversed lower at the 23.6% retracement. The pair has breached the support at 1.25140 and is approaching a major support at 1.24000. ADX is edging higher, suggesting a powerful trend in the market. RSI has moved past the 50 line which consolidates the downtrend.

Trade suggestion

Sell Stop at 1.25000, Take profit at 1.24000, Stop loss at 1.25500



GOLD



Fig: GOLD H4 Technical Chart

Gold has been trading in a thin range around the 50.0% Fibonacci level since last Thursday. The price action has crossed over the short-term MA20 but downward pressure from the long-term MA50 are being exerted on the price, which has restrained gold’s bullish momentum even though the precious metal has been supported by the 50.0% handle. While ADX showed no clear trend in the market, gold is expected to edge lower as RSI is suggesting a strengthening bear.

Trade suggestion

Sell Stop at 1210.00, Take profit at 1200.00, Stop loss at 1215.00



CAC40



Fig: CAC 40 H4 Technical Chart

CAC 40 pulled back from near the 61.8% level. The index is facing the short-term MA20 and is about to fall into a gap created by two MAs. The %K line is taking a lead over the %D line and heading downwards. However, with the support from two MAs, the index is expected to reverse higher.

Trade suggestion

Buy Limit at 4500.00, Take profit at 4554.00, Stop loss at 4475.00

 

[CSFX.Support]

AUD/USD signal by Capital Street FX

AUD/USD signal by Capital Street FX

From GMT 07:40 24/11/2016
Till GMT 21:00 24/11/2016

Sell at 0.73700
Take profit at 0.73300
Stop loss at 0.73900

 

[CSFX.Support]

Daily Report on November 24, 2016 by Capital Street FX

Daily Report on November 24, 2016



Most Asian stock market retreated while European shares gained modestly on Thursday. MSCI's broadest index of Asia-Pacific shares outside Japan dropped 0.4 percent, while Hong Kong's Hang Seng and China's blue-chip CSI300 index also declined, sliding 0.2 percent and 0.4 percent, respectively. On the contrary, the drop in the Japanese yen lifted the export-orientated Nikkei in Tokyo to a near 11-month high.

Wednesday’s upbeat economic data and Fed meeting minutes strengthened the prospect for higher U.S. interest rates, helping sustain the dollar's rally on Thursday. The greenback reached fresh highs across the board against rivals, sending the dollar index to fresh 13-and-half-year highs in early European trade. As a result, gold futures plunged, extending the prior day’s drop.

Gold prices hit their lowest settlement since early February, after solid U.S. economic indicators and Federal Reserve meeting minutes which underpinned speculation for an interest-rate rise, raised the opportunity cost of holding the non-yield asset.

According to pricing in federal funds futures contracts, investors are betting in a 100 percent probability of a change in the U.S. rate next month, as the minutes of November’s meeting said a rate hike could come “relatively soon.”

“Some participants noted that recent committee communications were consistent with an increase in the target range for the federal funds rate in the near term or argued that to preserve credibility, such an increase should occur at the next meeting,” the record of the Federal Open Market Committee meeting showed.

Given a tightening labor market and improving inflation, Federal Reserve officials saw a strengthening case to raise interest rates. Fed policymakers will hold their final meeting of the year in mid-December.

Crude oil were relatively steady on Thursday, even after a weekly report by the U.S. Energy Information Administration on Wednesday showed that U.S. crude oil stocks fell last week after three straight weeks of builds. Crude oil inventories dropped 1.3 million barrels in the week ending November 18 as imports declined while refineries hiked output. Traders are waiting for next week's meeting of the Organization of the Petroleum Exporting Countries.

Trading volume is expected to be lighter than usual, as U.S. equity markets are closed Thursday for the Thanksgiving Day holiday.



Technicals

EURGBP



Fig: EURGBP H4 Technical Chart

EURGBP has fallen into a consolidation around 0.84800 after falling sharply from the level at 0.85800. The pair had been on a rise before hitting the long-term MA50. As can be seen from the RSI chart, the market has remained in the bearish territory for more than 2 weeks. With downward pressure from a couple of MAs hanging above the price chart, the pair is expected to slide further to the 38.2% level.

Trade suggestion

Sell Stop at 0.84600, take profit at 0.84000, stop loss at 0.84300



USDJPY



Fig: USDJPY H4 Technical Chart

USDJPY has rallied for half of a month and has breached three Fibonacci levels in a row. The pair is attempting another Fib retracement at 61.8% handle. Although the target may be reached, the market is likely to fall into a correction as it has penetrated the oversold area.

Trade suggestion

Buy Stop at 113.200, take profit at 114.000, stop loss at 112.800



SILVER



Fig: SILVER H4 Technical Chart

Silver has pulled back but still held near 5-and-1/2 lows at 16.141. The metal price broke below the 61.8% level yesterday after moving back and forth around this handle. As bears are still overwhelmingly dominating in the market and being supported by two MAs lingering above the price action, silver is anticipated to test the 16.000 support.

Trade suggestion

Sell Stop at 16.300, take profit at 16.000, stop loss at 16.450



EURO 50



Fig: EURO 50 Index H4 Technical Chart

Euro 50 index has been swing between gains and losses since the start of last week. The benchmark is struggling below the 3040.00 level with no clear trend in the market. While the two MAs have twisted with the price action, the RSI index is lingering near the 50 line. In the case of continual upbeat moves, the index is expected to test the 3060.00 level.

Trade suggestion

Buy Stop at 3040.00, take profit at 3060.00, stop loss at 3030.00

 

[CSFX.Support]

Brent Crude Market Outlook by Capital Street FX

Oil Retreats Ahead of OPEC’s Meeting, Market Activily Low on Holiday

Crude oil prices were slightly lower on Thursday. Even though U.S. crude supplies were reported to U.S. crude oil stocks drop last week, investors remained in cautiousness ahead of next week’s meeting of the Organization of the Petroleum Exporting Countries (OPEC) to finalize its proposed cap on production reached earlier this September.

Due to the U.S. Thanksgiving holiday, market activity was low on Thursday. Furthermore, traders were reluctant to take on big price bets amid uncertainties over the outcome of OPEC’s meeting which is scheduled on November 30th.

Energy Minister Alexander Novak stated earlier today that Russia could revise down its 2017 oil production plans by 200,000-300,000 barrels per day (bpd) if a global output freeze comes into force. As reported to be stated by Azerbaijan Energy Minister Natig Aliyev, OPEC will probably propose that other producers cut production by 880,000 bpd for six months starting from next year.

However, according to an OPEC source, OPEC has yet to make a final proposal to non-OPEC countries on joint production cuts, which will not be discussed until Nov. 28 in Vienna.

It remains uncertain whether an output-cut deal could be enough to balance a market that has already been dogged by a glut for more than 2 years. Fatih Birol, Director of the International Energy Agency, said that even if production is cut, higher prices could prompt U.S. shale oil drillers to massively increase their own output.

A weekly report by the U.S. Energy Information Administration on Wednesday showed that U.S. crude oil stocks fell last week after three straight weeks of builds. Crude oil inventories dropped 1.3 million barrels in the week ending November 18 as imports declined while refineries hiked output.

Fig: BRENT D1 Technical Chart

Brent crude has retreated for a third consecutive session after reaching the highest level since October 31 on Monday. The price action failed to breach the long term DMA50 and is heading downwards to the support at 23.6% level. Stochastic lines have escaped from the overbought zone and is pointing down, suggesting further declines.

Trade suggestion

Sell Stop at 48.80, Take profit at 48.20, Stop loss at 50.00

 

[CSFX.Support]

Daily Report on November 25, 2016 by Capital Street FX

Daily Report on November 25, 2016



The U.S. dollar pared a weekly surge on Friday, as its rally came to a halt when investors took profit in the last session of the week. Global equities were higher with the MSCI All-Country World Index extending its weekly advance to 1.1 percent. U.S. equity-index futures advanced with Treasury yields following the Thanksgiving holiday. Gold scaled back from a nine-month low, while crude price trimmed its second weekly gain.

Oil dropped more than 1% on Friday as investors cast doubt on the outcome of the OPEC’s meeting next week while Arab Saudi was reported to increase its supplies to Asian clients. According to market sources, Saudi Aramco will push its supplies to some Asian customers higher in January as Russia has overtaken its place as top supplier to China. Even an output-cut deal is reached on November 30th; it will not impact supplies until February 2017 because most exporters sell their supplies two months ahead.

The Office for National Statistics on Friday confirmed that Britain's economy grew 0.5 percent in the third quarter. The solid growth was powered by a rebound in net exports which added 0.7 percentage points to economic growth, and robust household spending. In overall, the economy expanded 2.3 percent versus the same period last year, which is unchanged from a preliminary estimate.

Elsewhere, a budget outline from Japanese government showed that Japan plans only a modest boost to government spending next year. Prime Minister Shinzo Abe looks set to take a different policy direction than one expected from U.S. President-elect Donald Trump, who has pledged to reinforce fiscal stimulus. The budget document reiterates the government's ambitious aim to boost annual economic output by 20 percent to 600 trillion yen ($5.29 trillion) by fiscal 2020.



Technicals

EURUSD



Fig: EURUSD H4 Technical Chart

EURUSD extended its correction from the lowest level since early-December, 2015. However, the upside seems limited as the pair is struggling around the short-term MA20 at 1.05849. RSI failed to move past the 50 line to confirm the uptrend. Therefore, the pair is anticipated to slide further.

Trade suggestion

Sell Stop at 1.05700, Take profit at 1.05000, Stop loss at 1.06000



GBPAUD



Fig: GBPAUD H4 Technical Chart

GBPAUD has been trading in a thin range after it breached the 50.0% Fibonacci retracement at 1.67630. The price action has broken below the short-term MA20 and is likely to cross over the long-term MA50 as well. With RSI having moved past the 50 line and pointing down, the pair may retest the support at 1.66650

Trade suggestion

Sell Stop at 1.67400, Take profit at 1.66650, Stop loss at 1.77000



GOLD



Fig: GOLD H4 Technical Chart

Gold rebounded from the support at 61.8% - the lowest level last seen in early-February. Gold market is in a correction after a steady slide sent the market into the oversold zone. The precious metal may have to resume its downside soon as the short-term MA20 and the resistance at 1200.00 are within the sight.

Trade suggestion

Sell Limit at 1200.00, Take profit at 1180.00, Stop loss at 1210.00



FTSE 100



Fig: FTSE 100 Index H4 Technical Chart

FTSE 100 index has broken above the resistance at 6820.00. In general, the index has been moving sideways around this level for most part of the week. As RSI is pointing to a market in favor of buyers and two MAs are hanging below the price action, the U.K. stock benchmark may edge higher.

Trade suggestion

Buy Stop at 6850.00, Take profit at 6900.00, Stop loss at 6825.00