Asian equities initially rallied after Fed minutes promised patience on further policy action but most have moved down from earlier highs.
Hopes that the US and China are nearing a deal on trade have risen after an unnamed source cited by Reuters said the two sides have started to outline commitments in principle in what is described as the most significant progress yet.
The JPY225 closed with a gain of just 0.15%, while the Topix was unchanged from yesterday. The Hang Seng is up 0.03% and mainland China indices are also little changed.
The AUS200 outperformed and rallied 0.70%, after better than expected jobs data.
US futures are stronger after Reuters reports outlined progress in US-Sino trade talks and European futures are also moving higher.
The March WTI futures are trading at USD 57.33 per barrel.
Charts of the Day
Main Macro Events Today
EU PMIs – EU Manufacturing PMI is expected to have declined to 50.3 in February, compared to 50.5 last month, dangerously close to the 50 threshold. Services PMI is expected to have increased to 51.4, compared to 51.2 in January, hence pushing the overall Composite PMI higher to 51.1, compared to 51.0 in the previous month.
Philly Fed Index – The Philly Fed Manufacturing Index is expected to have declined to 14, compared to 17 in January, still registering a positive effect.
Durable Goods – Durable goods are expected to come out registering positive growth for December, compared to negative for November.
US PMIs – Manufacturing is expected to have declined in the US, similar to the EU, reaching 54.7 compared to 54.9 last month, while Services are expected to have slightly grown to 54.3 compared to 54.2 in January.
Existing Home Sales – Home Sales are expected to have remained at more or less the same levels, at 5M, compared to 4.99M last month.
CB Leading Index – The Conference Board Index is expected to have shown a 0.1% m/m increase in January, compared to the 0.1% m/m contraction in December.
Support and Resistance
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.
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.
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.
Both Topix and Nikkei, declined during the Asian session, with -0.25% and -0.18% respectively.
Overall, stock markets in Asia struggled through most of the session as subdued inflation data rekindled concerns about a lack of demand and flagging growth and after Wall Street closed in the red.
News that US President Trump will meet with China’s top trade negotiator today in Washington seems to have helped Chinese markets to stage a late rally and CSI 300 and Shanghai Comp are up 1.76% and 1.51% respectively and the Hang Seng also managed to claw back losses and is up 0.11%.
US stock futures are posting marginal gains and the April WTI future is trading at just over USD 57 per barrel.
USDCAD rallied over 1.32 to 1.3225, as Oil inventories rose, with the US at record production levels. Oil price is now back around the $57 mark.
Japanese CPI data same as forecasts, pushing the Yen higher.
Charts of the Day
Main Macro Events Today
EU CPI Inflation – Core inflation is expected to be confirmed at 1.1% y/y while the overall inflation rate is expected to have stood at 1.4% in January.
Canadian Retail Sales – Retail Sales are expected to have declined by 0.3% m/m in December, an improvement from the 0.6% declined observed in November.
Mario Draghi Speech – The ECB President is due to speak to the University of Bologna where he will accept an honourary degree.
Support and Resistance
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.
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.
Dr Nektarios Michail
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.
Stock markets outside of mainland China headed south.
The first offshore default by a Chinese state owned company in 20 years sparked a fresh wave of risk aversion and concerns over the health of the Chinese economy, as it has failed to repay a US dollar bond in Hong Kong.
Border tensions between India and Pakistan added to the risk-off sentiment.
European stock futures are also heading south, in tandem with US futures,amid ongoing Brexit uncertainty.
German GfK consumer confidence held steady at 10.8 in the advanced reading for March, unchanged from the February reading.
WTI crude dropped $2.00/bbl on Pres Trump tweet “Oil prices getting too high.”
USDJPY fell amid risk-on theme, but still above 110.70.
EURUSD firmer to around 1.1350 area.
Gold is still unable to move decisively past the 1330 mark.
Charts of the Day
Main Macro Events Today
Inflation Report Hearings
UK Prime Minister Theresa May will update parliament today.
US Housing data – Housing starts are estimated to rise 0.3% to a 1.260 mln pace in December, following a 3.2% jump to 1.256 mln in November. Building Permits are set at 129M in December.
Fed Chair Powell Testifies – Fed Chairman Powell gives his semi-annual report to Congress. He will testify before the Senate Banking Committee.
CB Consumer Confidence – It is expected to rise to 124.0 in February, from an 18-month low of 120.2 in January, and versus an 18-year high of 137.9 in October.
Support and Resistance
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.
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.
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.
Asian stock markets started higher after Fed’s Powell reiterated the cautious stance at the US central bank, telling lawmakers that there is “no rush to make a judgment” on further rate hikes.
Traders are awaiting the second half of Powell’s testimony, while watching the US-North Korea summit, but after the sharp corrections in the second half of last year markets appear reluctant to push up too far.
Dollar gained some against the Euro as CB confidence rose to 131.4, compared to 124.8 last month, while GBP declined from its 1.3272 peak. The Yen continued to rally against both the Euro and the Dollar, currently trading at 110.44 with respect to the latter.
Topix and Nikkei closed with gains of 0.20% and 0.50% respectively, while mainland China bourses, which outperformed through much of the session, have erased gains leaving CSI 300 and Shanghai Comp down 0.56% and 0.02%.
Small caps underperformed and the Shenzhen Comp is down -0.87%.
The Hang Seng meanwhile is still hanging on to a 0.20% gain.
US futures are heading south while the front end WTI future lifted to USD 55.88 per barrel.
Charts of the Day
Main Macro Events Today
US Durable Goods – Durable goods orders, an important indicator of consumer spending, are expected to have grown by 0.2% in January, compared to 1.2% in December.
Canadian Inflation – Probably the country which usually posts the world’s most stable inflation rate, Canada is nonetheless expected to have seen its prices grow by 1.5% y/y in January, compared to 2% in December.
Fed Chair Powell Testifies – Fed Chairman Powell continues his semi-annual report before the Senate Banking Committee.
Pending Home Sales – Pending Home Sales are expected to have grown by 0.4% m/m, compared to -2.2% in December.
Factory Orders – Orders are expected to have increased by 0.5% m/m, compared to a 0.6% reduction in November.
Support and Resistance
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.
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.
Andria Pichidi
Dr Nektarios Michail
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.
Bond and stock markets came under pressure during the Asian session.
The US-North Korea summit ended abruptly and without any ceremony, which weighed on investor sentiment and saw stock markets heading south in Asia.
Chinese manufacturing PMI numbers, which fell back to 49.2 from 49.5, and escalating tensions between India and Pakistan added to the risk-off backdrop.
Topix and Nikkei both lost -0.79%, the Hang Seng is down -0.19%, CSI and Shanghai Comp lost -0.14% and -0.38%, but the Shenzen Comp managed to claw back some of yesterday’s marked losses.
The ASX and Nifty outperformed and managed slight gains.
US futures are also heading south, as oil prices are lower on the day and the April WTI future is trading at USD 56.76 per barrel.
Oil was a big mover yesterday, up and then down on reports of record US production, after the Inventories showed a draw-down of 8 million barrels against expectations of a increase off 2.8 million.
Charts of the Day
Main Macro Events Today
US GDP and PCE – US Q4 GDP is expected to have grown by 2.3% on an annualised rate, compared to 3.4% in Q3. PCE inflation is expected to have stood at 1.7%, increasing from 1.5% in the previous quarter.
Canada Current Account – The Canadian current account deficit is expected to have widened in the final quarter of 2018, with consensus forecasts standing at 13.5B, compared to 10.3B in the previous quarter.
Chicago PMI – The Chicago PMI is expected to have increased to 57, compared to 56.7 in January.
Tokyo Core CPI and Japan Unemployment Rate – The Tokyo Core CPI, a proxy for overall Japanese inflation, is expected to have stood at 1% y/y in February, compared to 1.1% in January.
Support and Resistance
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.
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.
Dr Nektarios Michail
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.
Asian stock markets rallied driven from MSCI, weighted on Bonds.
MSCI Inc. announcement that will increase the weight of Chinese stocks in its global benchmarks also underpinned bourses.
The strong manufacturing PMI reading out of China, following on the heels of better than feared US GDP readings yesterday helped to underpin risk appetite.
The Yen has weakened concomitantly with rising stock markets in Asia.
German January retail sales much stronger than expected at 3.3% m/m
Eurozone HICP inflation seen ticking up to 1.5% y/y from 1.4%.
EURUSD dropped back from 3-week highs to mid 1.13s.
USDJPY rallied to 10-week high of 111.80.
Gold slide on better US GDP, higher yields and stronger Dollar.
Charts of the Day
Main Macro Events Today
EU Final Manufacturing PMI – They are expected to confirm the overall Eurozone reading at 49.2, which would leave it in contraction territory.
EU CPI and core – The overall Eurozone HICP is seen ticking up to 1.5% y/y from 1.4%, while core inflation is likely to hold at just 1.1% y/y.
German jobless numbers – Jobless data is seen rising 1K (median -3K), which should leave the jobless rate at a record low of 5.0%
Canadian Q4 GDP – GDP for the last Quarter of 2018 is expected to slow to a 1.0% pace (q/q, saar) in January from the 2.0% rate of expansion in Q3, reflecting the hit from the oil price plunge during the quarter.
Canadian December GDP – It is seen coming in flat (0.0%) after the 0.1% decline in November, reflecting the drag on the economy from the oil producing sector.
US December personal income – It is projected rising 0.5% after a 0.2% rise in November, reflecting strength in December aggregate income.
US PCE – A -0.3% decline is seen in real PCE in December, following a 0.3% increase in November. Core PCE Price Index is anticipated at 0.2%m/m from 0.1%m/m.
US ISM Manufacturing PMI – The February ISM is expected to slip to 55.0 in February, but from a robust 56.6 reading in January.
Support and Resistance
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.
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.
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.
A report in the WSJ over the weekend that the US and China closing in on a deal, and that Trump and Xi are to meet on March 27, pushed equities up although nothing is confirmed by Beijing or Washington.
USA500 closed over 2800 Friday and holds gains this morning at 2813, while Nikkei closed up 1%. USD holds gains.
Oil big down day on Friday with a move to 55.65 from 57.50. Gold closed the week under 1300.00, with trades down at 1294.
Big policy week ahead, with ECB, RBA, and BoC interest rate decisions, as well as NFPs on Friday.
The Brexit process will remain a key focus for markets this week. Political developments in the UK last week reduced the odds for a no-deal Brexit scenario, although it has always be our conviction that this is a low-risk possibility as the UK parliament will have final say and, given the numbers and strength of view of most MPs, it is hard to conceive that a no deal would be allow to happen.
Charts of the Day
Main Macro Events Today
UK Markit Manufacturing PMI – The UK PMI is expected to have stood at 50.2 in February compared to 50.6 in January, in response to the slowdown in the world economy.
Support and Resistance
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.
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.
Dr Nektarios Michail
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.
Stock markets struggled after Wall Street closed lower on Monday.
US equities slumped as trade optimism gave way to fresh economic concerns after the drop in construction spending.
The US may lift tariffs on Chinese imports, will sign off on final deal later in the month (March 27).
Bloomberg also reported that some $90 bln (3%) in VAT reductions is planned by China as well.
China lowered its official goal for economic growth this year to 6.0% from 6.5%.
RBA left official cash rates unchanged at 1.50%, as expected.
WTI future is trading at USD 56.36 per barrel.
Gold dipped under $1,284 on risk-on trade, before finding prop from stock slump.
USDJPY off Friday’s 10-week high at 112.07.
EURUSD hit 1-week lows into ECB.
Charts of the Day
EURUSD crossed the 20-day SMA. In the 1-hour chart, the bearish cross of 50- and 200-period EMA along with the negative configured indicators imply further declines.
USDJPY moves for a 3rd day above an ascending triangle, the 200-DMA and on Friday broke the 11-day Resistance. This suggests the strengthening of the positive bias.
GBPUSD held in an upwards channel in the daily chart despite 3 negative sessions. Intraday is below 3 MAs, while Support is at 1.3140 and 1.3110.
XAUUSD is extended below BB. It found Support at 1,282.80 Next Support at 1,275 and Resistance at yesterday’s peak.
Biggest Loser: NZDUSD forms 5 consecutive bearish daily candles, trading below the 20-day SMA, while the long low wings suggest an increasing bearish bias overall.
Main Macro Events Today
EU Markit PMI Composite – The final Services PMI is expected to be confirmed at 52.3 which should leave the composite reading at 51.4, but with a slight risk to the upside after the marginal revision to the manufacturing PMI.
UK Service PMI – The Services PMI reading is expected to come in at 50.0, the dividing line between contraction and expansion.
US Home Sales – New home sales are estimated falling 8.7% in December to 600k after a 16.9% surge in November.
US ISM Non-Manufacturing PMI – February ISM-NMI index is forecast to rebound to 57.3 after falling 1.3 points to 56.7 in January.
BoE Governor Carney – BoE Carney is due to testify on Brexit, inflation, and the economy before the House of Lords Economic Affairs Committee, in London.
Support and Resistance
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.
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.
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.
Bond yields declined after Fed’s Rosengren suggested the pause in the rate hike cycle may last several meetings, while Morgan Stanley is now predicting that Treasury yields will continue to drop by the end of the year, and traders are likely to remain cautious ahead of US jobs data on Friday.
Australian bonds rallied and the AUD was under pressure as weaker than expected GDP numbers data added to speculation of rate cuts from the RBA, which in turn helped the ASX to gain 0.75%.
Overall stock markets traded mixed across Asia with markets reluctant to push out valuations further without more concrete details on the possible US-Sino trade deal.
Dovish-leaning BoJ comments failed to give Japanese markets a lift and Topix and Nikkei closed with losses of -0.25% and -0.60% respectively.
China’s announcement of measures to boost domestic consumption further this year, helped Shanghai and Shenzhen Comp to gain 0.55% and 0.46% respectively.
US stock futures are broadly lower, as are European futures, while the front end WTI future is trading at USD 56.10 per barrel.
Charts of the Day
Technician’s Corner
EURUSD traded around 1.13, unable to break decisively in either direction, as the post-PMI rally eased. MACD and Stochastics point to an uptrend although MAs are still down.
USDJPY managed to maintain its gains, as the short-term MA appear about to break through the longer-term MA and the mid-Bollinger level, supported by the indicators.
GBPUSD moved slightly down on account of the Dollar strength, albeit not breaking through the 1.31 mark. Indicators are showing mixed signals.
XAUUSD broke through the mid-Bollinger level and has been moving towards its 200HMA. Support level is at 1290, with Resistance at 1320.
Biggest Winner: EURAUD gained significantly as RBA Governor Lowe tried to downplay the importance of the housing market slump, arguing that the probabilities are evenly balanced between rate hikes and rate decreases.
Main Macro Events Today
ADP Employment Change (GMT 13:15) – February’s labour market data are projected to have been improving at a lower rate, at 189K, compared to 213K in January.
BoC Rate Statement (GMT 15:00) – BoC is not expected to raise interest rates, a result of weaker than expected Canadian data releases, as well as the overall “wait and see” stance of many Central Banks around the world.
US Crude Oil Inventories (GMT 15:30) – The change in the number of barrels of crude oil held in inventory by commercial firms during the past week affects both the price of Oil as well as Oil-dependent currencies such as the Loonie and the Aussie. Forecasts are that inventories will rise by 1.2M, compared to a reduction of 8.6M last week.
Support and Resistance
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.
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.
Dr Nektarios Michail
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.
The Yen and the Swissy edged up as investors sought shelter in safe-haven currencies, and stock markets headed south during the Asian session amid fresh concerns about the global growth outlook, increased US-North Korea tensions, and as traders await more details on a possible US-Sino trade deal.
The BoC added its name to the growing list of central banks that are taking a pause to assess current risks, maintaining rates at 1.75% and watering down its rate normalization.
Yesterday’s data showed the US trade deficit widening to a 10-year high, which will only increase the risk of further protectionist measures at a time when global trade tensions increasingly weigh on growth prospects.
The OECD cut forecasts for the global economy in 2019 and 2020, again yesterday, delivering a bleak assessment of the global economy. However, the prospect of further stimulus measures is keeping bond markets underpinned and the fallout in the stock market appears to be limited. Still, all Asian markets are trading in the red, with the only exception being the ASX which rose by 0.29%.
US futures are heading south, however, while the front end WTI future is trading at USD 56.26 per barrel.
Charts of the Day
Technician’s Corner
EURUSD is trading around 1.13 again, unable to break decisively in either direction, in anticipation of the ECB meeting and the NFP data tomorrow.
USDJPY has declined as investors sought shelter in safe-haven currencies, reaching 111.68 and creating a downwards trend towards the 200-HMA at 111.30.
GBPUSD moved slightly higher, albeit not breaking through and remaining above the 1.319 mark. MACD, Stochastics and MAs point downwards.
XAUUSD broke through its Support level at 1290, and appears to have currently paused at 1284. Indicators are sending mixed signals.
Biggest Winner: USDCAD gained significantly as BoC maintains its interest rates unchanged. The pair jumped 20 pips during the meeting and is currently trading at a 2-month high at 1.3442.
Main Macro Events Today
EU GDP (GMT 10:00) – The European Union’s GDP is expected to come out at 1.2% y/y, the same as the preliminary release in February.
ECB Interest Rate Decision (GMT 12:45) – No changes are expected from the ECB meeting, although Mario Draghi’s speech could provide more insights with regards to the potential TLTRO implementation or other possible policy measures.
Productivity, Labour Costs, Jobless Claims (GMT 13:30) – Productivity is expected to have slowed down to 1.6% in Q4, compared to 2.3% in the previous quarter, while Labour Costs are expected to have risen by 1.6%, compared to 0.9% in Q3. Initial Jobless Claims are expected to have remained at the same level, while Continuing Jobless Claims are expected to have declined to 1.775M.
Support and Resistance
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.
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.
Dr Nektarios Michail
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.
Global sell off in stock markets continued during the Asian session.
Chinese markets in particular sold off after much weaker than expected trade data and a rare “sell” rating from China’s largest brokerage was taken as a sign that the government wants to limit gains on equity markets.
The ECB’s dovish turn and sharp growth revisions have fuelled concerns about the global outlook and sparked a fresh wave of risk aversion.
German manufacturing orders slumped -2.6% m/m in February
The WTI future is trading at USD 56.38 per barrel.
Charts of the Day
Technician’s Corner
EURUSD has consolidated around 1.12 after post-ECB plunge into 21-low terrain. The weak bullish candles suggest a weak positive bias.
GBPUSD in a ranging market with immediate Resistance at 1.3100 and Support at 1.3065. Overall remains in downtrend with Momentum indicators negatively configured intraday and daily as well.
XAUUSD reached 1293 level but remains for 5th day above 1280 which stands a near term Support. It break outside hourly Bollinger Bands could follow by a pullback as it suggest an overextended move.
Biggest Winner: USDJPY has dipped to 110.95 from 111.60. The pair broke the the 200-day moving averageand is currently retesting a cross into negative BB area. This along with a decline of positive bias in MACD and Stochastic suggest a possible turn of the outlook into negative one in the medium term.
Main Macro Events Today
US Housing starts – It should rise 11.3% to a 1.200 mln pace in January after an 11.2% drop to 1.078 mln in December.
US NFP – A rather solid February nonfarm payroll report is seen, even if the headline 180k job gain significantly undershoots the 304k January surge and would be the smallest gain since September.
Canadian Labor data – Employment is expect to reveal a 20.0k gain in jobs during February after January blasted through expectations with a 66.8k increase. The unemployment rate is seen unchanged.
Support and Resistance
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.
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.
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.
Stock market sentiment started to stabilise during the Asian session and many indices, first and foremost in China, managed to claw back some of Friday’s losses.
Chinese indices led the way after moving past the disastrous trade number from last Friday.
While dovish-leaning central banks in general and the additional action from the ECB in particular sparked fears that the global growth outlook is actually worse than anticipated, the fact that there is more support should also be constructive for stock markets in the medium term.
BoJ is set to meet this week while it is believed that China and the US are in general agreement on many crucial issues and have held meaningful discussions on foreign exchange, according to People’s Bank of China Governor Yi Gang.
Topix and Nikkei are up 0.57% and 0.47% respectively, the Hang Seng gained 0.68%, CSI 300 and Shanghai Comp are up 1.47% and 1.35% respectively and the Shenzhen Comp outperformed with a 3% gain. The ASX meanwhile was among the few underperformers with a loss of -0.38%.
US futures are narrowly mixed, with the Dow Jones futures underperforming and the front end WTI future trading at USD 56.32 per barrel.
Charts of the Day
Technician’s Corner
EURUSD has consolidated having risen after the NFP release, with 1.1256 standing as the next Resistance level, while Support is found at 1.1224.
GBPUSD appears to be currently moving in anticipation of tomorrow’s Brexit developments, with immediate Resistance at 1.3050 and Support at 1.2961.
XAUUSD moved past 1300 for a while before retracting, but remained above 1280 for a 6th day. Immediate support is at 1292 while Resistance remains at 1300.
USDJPY is still trading at two week lows, with the immediate Support and Resistance levels standing at 111.05 and 111.25.
Main Macro Events Today
Retail Sales ex Auto (USD, GMT 12:30) – Retail Sales are expected to have grown by 0.3% m/m, most likely a base effect from the previous 1.8% reduction in December.
Eurogroup Meeting (EUR, Full Day) – The Finance Ministers of each Member State will meet in Brussels to discuss various financial issues, including fiscal policy.
Support and Resistance
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.
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.
Dr Nektarios Michail
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.
The global stock market recovery continued during the Asian session.
News came out at the last minute that a “legally binding” agreement has been reached between the EU and the UK, giving May an assurance that the dreaded Irish border backstop doesn’t become permanent underpinned.
The pound strengthened, as well as stock markets across Asia after a positive close on Wall Street, where robust retail sales had helped to bolster confidence.
The latter also helped tech stocks to break the losing streak amid news that Nvidia Corp. agreed to buy chipmaker Mellanox Technologies Ltd.
Topix and Nikkei rose 1.52% and 1.79% respectively overnight. The Hang Seng is up 1.2% and CSI 300 and Shanghai Comp rose 0.48% and 0.76% so far, with the Shenzen Comp up 0.88%.
The ASX underperformed and closed with a loss of -0.09%, as Aussie loans data again came out negative.
US futures are broadly higher, while the front end WTI future saw a high of USD 57.14 before falling back to now USD 56.91 per barrel.
Charts of the Day
Technician’s Corner
EURUSD has continued its rise after the positive Brexit news, trading around the 1.1256 Resistance level, far from both the next 1.1224 Support and 1.13 Resistance.
GBPUSD gained on the positive Brexit developments, breaking through the 1.32 Resistance but the MACD suggests that this may be running out of steam.
XAUUSD continues to fluctuate around the 1295 mark, with the MACD and Stochastics indicators pointing to the downside as price it hits its 200HMA.
USDJPY continues to move upwards, with immediate Resistance at the 200HMA level at 111.54, while Stochastics and the MACD point downwards.
Main Macro Events Today
Industrial and Manufacturing Production (GBP, GMT 09:30) – Industrial and Manufacturing Production are expected to have remained flat registering 0.0% m/m growth in January, compared to a 0.5% and 0.7% declines in December.
Consumer Price Inflation (USD, 12:30) – US CPI is expected to stand at the same level as in January, both for the overall and the core index, at 2.2% and 1.6% respectively.
Brexit Vote (EUR, USD, N/A) – The UK Parliament will vote on whether it will accept May’s amended deal, in light of today’s agreement on the backstop.
Support and Resistance
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.
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.
Dr Nektarios Michail
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.
The dollar pulled ahead from a nine-day low on Thursday, largely helped by the pound snapping back after a sharp rally made on Brexit relief.
MPs surprised the government and voted by 312 to 308 to reject a no-deal Brexit under any circumstances. The vote is not binding – under current law the UK could still leave without a deal on 29 March.
Another vote tonight, with British lawmakers widely expected to vote in favour of a Brexit delay.
US grounded Boeing’s 737 Max 8 and 9 fleet as announced by the FAA, with Boeing itself recommending that the 737 Max should be taken out of service. More than 370 such planes are operated. Boeing saw its value decline by $26.6 billion this week.
Data from China point to the negative as unemployment has risen, industrial production growth has slowed, even though retail sales continue to grow.
Gold declined as the Dollar strengthened, still trading about 1300. Oil reaffirmed its gains and traded around $58.
Charts of the Day
Technician’s Corner
EURUSD continued its rise after the rejection of the no-deal Brexit. The pair broke through its 200HMA, and the Resistance point at 1.13, but has not managed to stay above the 1.1330 Resistance. Indicators are showing mixed signals.
GBPUSD gained after the rejection of the no-deal Brexit, breaking through the 200HMA yesterday, but bouncing off both the 1.3336 Resistance level and the 1.3245 Support.
XAUUSD lost as the Dollar gained yesterday, coming down from the 1310 highs and currently trading at 1302. The MACD and Stochastics are issuing negative signals.
USDJPY continues its slow upwards movement, breaking through the sideways channel as it is currently trading above its 200HMA level at 111.50, with immediate Resistance at 111.68. MACD and Stochastics are showing signs of saturation.
Main Macro Events Today
Jobless Claims (USD, GMT 12:30) – Continuing and Initial Jobless Claims are expected to have risen last week, by 2K and 20K respectively, reaching 225K and 1.775K.
New Home Sales (USD, GMT 14:00) –New Home Sales are expected to have marginally declined in January, to 0.62M from 0.621M in December.
Brexit Vote (EUR, GBP, N/A) – The UK Parliament will vote on whether a Brexit delay should be pursued.
Support and Resistance
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.
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.
Dr Nektarios Michail
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.
Asian indices broadly higher amid fresh hopes on the US-Sino trade front.
BoJ kept policy unchanged as expected, exports seen weighing on outlook.
Trump-Xi summit pushed back to end of April, USTR cited “major issues”.
Xinhua news agency reported that Chinese Vice Premier Liu He had a telephone conversation with US Secretary Mnuchin and US Trade Representative Lighthizer and that further substantive progress on trade talks has been made.
UK lawmakers backed a delay to the Brexit process.
PM May set to ask for a short term extension if her Brexit deal gets through by March 20, i.e. before the next EU summit, or a long term delay if not.
European stock futures are moving higher in tandem with US futures.
WTI future is trading at USD 58.76 per barrel.
EURUSD softer after posting 9-day high at 1.1341 following soft US PPI
USDJPY lifted to 1-week highs above 111.70; Yen wary of BoJ dovish tone.
Charts of the Day
Technician’s Corner
EURUSD found a floor at 1.1310 after rebounding from 1.1290 and overall remains in an uptrend. The same positive bias held intraday as well, with MAs pointing upwards and RSI sloping above 50.
GBPUSD is trading in a descending triangle. Support is held at 50-period SMA at 1.3225 and Resistance at 1.3265. A break of these barriers could suggest the near term direction for Pound.
XAUUSD rebounded from 1297 and broke the 1300 barrier earlier. Upper Bollinger bands are extending higher while the asset has regained more than 60% of the losses seen yesterday, turning the negative near term outlook to a positive one.
Main Macro Events Today
BoJ Kuroda Speech – Due to speak at the B20 Tokyo Summit.
EU Final CPI – The overall Eurozone HICP is anticipated at 1.5% y/y.
Canadian Manufacturing Sales – the Manufacturing shipment values are expected to edge 0.5% higher in January after the 1.3% drop in December.
Michigan Sentiment and Industrial Data– Industrial production is projected to rise 0.4% in February, after a 0.6% drop in January, while capacity utilization should rise to 78.4% from 78.2% in January. An early March Michigan Sentiment reading is expected of 96.0 , up from 93.8 in February, but well below the 14-year high of 101.4 last March.
Support and Resistance
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.
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.
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.
Stock markets rallied in Asia with Chinese indices leading the advance as markets prepare for a cautious Fed meeting this week.
China’s promise to support the economy via a cut in the VAT rate is adding support and helping markets to leave December lows far behind.
US futures are also on the rise as are European futures.
Japanese exports decline for a third consecutive month. Singapore non-oil exports swUng to surprise 4.9% rise in February after 3 months of decline
North Korea may suspend nuclear talks with the US, according to Russia’s TASS.
Brexit: May is still trying to get her Brexit deal over the line ahead of the March 21/22 EU summit, with an extension now needed even if the deal goes through.
BCC published a report showing that UK business investment is on course to decline by 1.0% in 2019, which would be the worst in a decade.
EURUSD above 1.1300, after marking 10-day peak near 1.1345 on tame Fed view.
USDJPY tipped lower on N. Korea back-track after printing 9-day peak at 111.90.
IEA warned of sharp Venezuela supply drop, but OPEC has spare capacity to offset.
The WTI future meanwhile is trading at $58.40.
Charts of the Day
Technician’s Corner
EURUSD found some ground on Friday’s closing. It is currently trading above its 10-day peak, in the upper BB pattern. Next Resistance 1.1360(50DMA) and Support at 1.1320 (20DMA).
GBPUSD is consolidating in the upper 1.32 area. Overall it remains in an up channel.
NZDUSD: Broke 3-day High and currently retesting the upper line of a descending triangle. Bullish inverse Head and Shoulders has also been identified in the hourly chart. Resistance holds at 0.6875-0.6900.
XAUUSD rebounded from 1,298 the past hour up to 1,304 area. Any consecutive bullish candles could suggest a positive intraday outlook.
Main Macro Events Today
Eurozone Trade data – Eurozone trade data as well as current account data are likely to reflect the global pressure on exports. January’s trade balance is expected to fall to EUR 13.2 bln, vs EUR 15.6 bln in February.
US NAHB Housing Market Index – The NAHB Housing Market Index for March kicks off the week, and it is expected to rise to 63 from 62 last time.
Support and Resistance
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.
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.
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.
The main focus is the eagerly awaited Fed announcement tomorrow, with the US central bank expected to turn down the to just one rate hike this year, and the USD remains in “wait n see mode” ahead of FED tomorrow.
Central banks in Indonesia, the Philippines and Thailand hold policy meetings this week and are expected to stay on hold as well.
In the RBA minutes, the outlook for the Aussie economy was mentioned as having “significant uncertainties’, as house prices cooled significantly more than expected too.
However, while the prospect of ongoing support from central banks and governments helped stock markets to move higher across Asia yesterday, today’s trading saw a broad correction, with Chinese indices, which outperformed Monday, underperforming today.
The Shanghai Comp lost -0.63%, the CSI 300 was down -0.82%, while the Hang Seng had declined -0.23%. Topix and Nikkei closed with losses of -0.21% and -0.08% respectively and the ASX was down -0.09% in the end.
US futures are posting fractional gains, while European futures are down. The front end WTI future meanwhile is trading at USD 58.98 per barrel, after touching a high of USD 59.14 overnight.
Charts of the Day
Technician’s Corner
EURUSD traded up and down yesterday, ranging around the 1.1345 Resistance level, breaking through it early today. Still below yesterday’s peak, MAs suggest the Euro will strengthen, supported by the MACD, while Stochastics suggest that it is overvalued.
GBPUSD is consolidating in the upper 1.32 area, moving on a sideways channel, still below end-February highs. MACD and Stochastics are showing down signals.
USDJPY has continued its downwards trend breaking through the 200HMA yesterday, reaching as low as 111.18, with Resistance standing at 111.40 and Support at 111.08.
XAUUSD continues to trade above the $1300 mark, in a slight upwards trend, even though Stochastics and MACD show signs of regression. Data releases and any Brexit developments today could affect it.
Main Macro Events Today
Average Earnings ex Bonus and Unemployment Rate (GBP, GMT 09:30) – Average Earnings in the UK are expected to have stood at 3.4% in the three months to January, the same growth rate as the previous time. The ILO unemployment rate is expected to remain at 4%.
Economic Sentiment (EUR, GMT 10:00) – March’s economic sentiment index is expected to stand at -18.7, a decline from the -16.6 observed in February.
Factory Orders (USD, GMT 14:00) – Factory orders are expected to have grown by 0.3% in January, compared to 0.1% in December.
Support and Resistance
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.
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.
Dr Nektarios Michail
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.
Fed day today – will they be as dovish as the markets seem to think? No change on the rates is expected but their musings on the future path of monetary policy, both conventional as well as with regards to its balance sheet position will be key for the USD and bond yields.
Ahead of today’s awaited Fed announcement the Asian session also experienced some profit taking as markets expected a dovish turn.
In the Asian session stocks traded narrowly mixed, with Chinese markets underperforming amid reports that China is pushing back against some of the US demands in trade talks.
Overall though traders see signs of eagerness to come to a deal among Chinese officials ahead of further trade talks as US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin are set to travel to China next week.
Topix and Nikkei managed to close with gains of 0.26% and 0.20% respectively. The ASX, however, was down -0.31% at the close and Hang Seng and mainland China bourses are also in the red.
US futures are little changed and the front end WTI future is trading at USD 58.97 per barrel.
Charts of the Day
Technician’s Corner
EURUSD traded mostly above the 1.1345 Resistance level, even though very close to it, in anticipation of the Fed meeting. Indicators are showing signs of consolidation.
GBPUSD is moving in a similar way as the EURUSD consolidating in the upper 1.32 area, for the 5th consecutive day, moving on a sideways channel, still below end-February highs. MACD and Stochastics support consolidation.
USDJPY moved slightly up on the leading indicator announcement, which showed worse than expected performance compared to the previous month. After etching to 111.60, the pair declined slightly, a move supported by both MACD and Stochastics.
XAUUSD is still above the $1300 mark, while some downwards momentum exists despite indicators pointing upwards. The Fed decision is expected to have a strong effect on Gold.
Main Macro Events Today
Retail, Producer, and Consumer Price Indices (GBP, GMT 09:30) – Both the CPI and the RPI are expected to have registered the same growth as January, showing 2.5% y/y and 1.9% y/y respectively. The PPI is expected to have grown by 4.3% y/y compared to 2.9% y/y last month.
Fed Interest Rate Decision (USD, GMT 18:00) – The eagerly awaited Fed decision is expected to shed light as to whether the 2 rate hike policy is to be continued or whether one rate hike is to be expected. Furthermore, comments on its potential balance sheet actions could also affect the markets.
Gross Domestic Product (NZD, GMT 21:45) – New Zealand GDP is expected to have grown by 2.5% y/y in 2018Q4, compared to 2.6% in 2018Q3.
Support and Resistance
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.
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.
Dr Nektarios Michail
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.
The EU summit starts today and while Brexit is not the only topic on the agenda, it will likely dominate discussions, after PM May yesterday officially asked for an extension until June 30 and ruled out that she as Prime Minister would ask for a long extension.
EU council president Tusk in his official response made it clear that a short extension will only be possible if the Withdrawal Agreement has been backed by MPs in London.
Tusk did not rule out a long extension but as May has made it clear that she as PM won’t ask for one, that is currently not on the table.
After an interesting meeting yesterday, the Fed was even more dovish than expected, suggesting that no rate hikes would take place in 2019, although leaving the window open for some hikes in 2020.
Overall, the Fed commented that a patient, semi-neutral approach was the best at this point, after the cooling in growth and inflation. Justification was sought in slower growth, static payrolls, weaker household spending and a decline in overall inflation.
In addition, the Fed also confirmed plans to taper in May, and then end in September, the balance sheet runoff.
Trump, following the Fed, tweeted that tariffs on Chinese goods could be in place for a “substantial period”. Equities dropped, after increasing as a result of the Fed dovishness.
Dow closed down 0.55% and under its 20 SMA. Asian shares are less impacted, but Japan is closed today.
Charts of the Day
Technician’s Corner
EURUSD pushed higher than the 1.14 level on the Fed dovishness, with expected Resistance at 1.1433, and then at 1.15. Indicators are supportive of a consolidation/downtrend mode this morning.
GBPUSD is slightly regaining its losses, still moving around the 1.32 area, on a sideways channel, still below end-February highs. MACD and Stochastics can perhaps be interpreted as sending positive signals.
USDJPY dropped heavily on the Fed announcement, crossing the 110.72 Support and its 200HMA. The next Support level is at 110.34, even though the MACD and Stochastics do not appear to agree with the downwards trend.
XAUUSD gained significantly and is trading at $1319, while some downwards momentum continues to exist according to the indicators. The Fed decision did have a strong effect, as suggested yesterday, and the question is whether Gold can now break through the $1321 Resistance level, or will retrace to the $1313 Support.
Main Macro Events Today
European Council Meeting (EUR, GBP, Full Day) – One of the most important European Council Meetings for the year, given that Theresa May will likely aim to provide justification for a Brexit delay.
Employment Data (AUD, GMT 00:30) – While the Unemployment Rate is expected to have remained at 5% in February, employment change is expected to have eased, increasing by 15K compared to 39K last month.
SNB Interest Rate Decision (CHF, GMT 08:30) – The SNB is not expected to surprise markets as the Swiss rate is forecast to remain at -0.75%.
Retail Sales ex Fuel (GBP, GMT 09:30) – UK Retail Sales are expected to have eased, growing by 0.2% on a m/m basis, compared to 1.2% in January.
BoE Interest Rate Decision (GBP, GMT 12:00) – Shadowed by the ongoing political developments in Brexit, the BoE is not expected to proceed with any interest rate actions.
CPI inflation (JPY, GMT 23:30) – National Core CPI for Japan is expected to have declined to 0.3% m/m in February, compared to 0.4% in January.
Support and Resistance
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.
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.
Dr Nektarios Michail
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.
Bund yields slightly higher in opening trade after cautious session on Asian stock markets.
EU hands UK another 2 weeks to avoid no-deal Brexit, eyes May 22 exit if deal passes, otherwise PM May must come up with a Plan B. If the deal gets through, an extension until May 22 has already been backed by the EU-27.
Japan’s nationwide core CPI undershot expectations at 0.7% y/y in February.
The European calendar focuses on Eurozone prel. March Manufacturing PMI readings.
Gold whipsawed back toward $1,300 by resurgent USD index near 96.5
EURUSD corrected back under 1.1400.
USDJPY up from 5-week low of 110.28.
WTI crude has settled slightly below $60.0 after posting a fresh 4-month high at $60.39
Charts of the Day
Technician’s Corner
EURUSD is slightly below Pivot Point of the day and the 38.2% Fib from the week’s peak, at 1.1385. A decisive break could lead towards 1.1410 Resistance. However indicators are not supportive, as they remain negatively configured.
GBPUSD topped at 1.3160, however the last 4 small body candles along with the latest doji candle suggest that upside movement might reach an end. Support at 1.3113 and 1.3000.
USDJPY dropped further into London open, down to 110.70. Indicators retreated from neutral zone, with RSI looking lower. The next Support level is at 110.64, and 110.36.
Main Macro Events Today
Eurozone Manufacturing PMI – Eurozone Manufacturing PMI is expected to improve marginally to 49.5 from 49.3 and the services reading to ease slightly to a still strong 52.7 from 52.8, which should leave the composite slightly higher at 52.0, versus 51.9 in the previous month.
Canadian CPI – The CPI is expected to climb 0.5% in February (m/m, nsa) after the 0.1% rise in January, boosted by stronger gasoline prices and seasonal strength in February’s CPI.
Canadian Retail Sales – The Retail sales are anticipated at 0.3% in January after the 0.1% dip in December.
US Home Sales – Sales are estimated to grow 0.6% following a 1.0% December decline. The I/S(Inventory to Sales) ratio should edge down to 1.32, from 1.33.
Support and Resistance
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.
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.
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.
