Daily Fundamental Dose

FxAnil · April 2, 2018, 7:59am

Daily Fundamental Dose: 02 – April – 2018

Hello Traders,

Not only upbeat US GDP & hawkish statements from some of the FOMC members, but improving relations between the U.S. & North Korea also helped the US Dollar Index (I.USDX) to recover its previous losses and mark a positive weekly close during last week. With this, the EUR & GBP had to bend down against the greenback as they lack any big positives to rely whereas export-oriented currencies, like AUD, NZD and CAD, dropped on trade-war fears and lack of welcome readings. Further, the JPY was also caught in the fire due to political problems at home, coupled with USD’s rise, while Gold had to take the losses with declining safe-haven demand. Moreover, Crude prices witnessed pullback on increased US production & higher inventory details.

While global investors have already experience heavy volatility during first quarter of 2018, start of second quarter was also entertaining for momentum traders. The reason was recent spat between US-China relations which contrasts to the upbeat print of China’s official Manufacturing PMI. As a result, the safe-havens, like Gold and JPY, started regaining their strength while Gold being sold on early trading hours of Monday. However, AUD, NZD and CAD couldn’t benefit from the greenback’s decline as Monday’s Caixin Manufacturing PMI from China & Export details unearthed the economic weakness of the world’s second largest economy and big export market for Australia, New Zealand & Canada. Additionally, Crude prices secured good start to the week with a dip in US drilling activity & news of US plans to levy fresh sanctions on Iran.

Moving forward, the first-day of Q2 2018 is likely to witness less attention as trading bourses in U.K., Australia, Canada, and most of Europe are still closed due to Easter holidays. Though, US ISM Manufacturing PMI & New Zealand’s NZIER Business Confidence could offer intermediate opportunities to market players. Herein, the US ISM Manufacturing PMI may register a soft print of 60.1 against 60.8 prior while New Zealand’s business climate gauge recently disappointed Kiwi Bulls with -12 mark and may hurt the NZD more if the reading declines beneath the prior.

Even if economic calendar has lesser catalysts to offer active market sessions, political front may gain major attention as China recently levied extra tariffs of up to 25% on 128 U.S. products in retaliation to the former’s trade-protectionist policies. The political drama at Japan seems soothing with majority of Japanese started showing faith in Abe government even after latest news of cronyism by the authorities.

Hence, while new quarter starts with fewer economics on hand due to Easter holidays, political stories concerning trade-war could keep propelling the market moves and may help the safe-havens like Gold & JPY.

Technical Talk

Even after taking a U-turn from 106.10, the USDJPY has to clear the 106.65 in order to aim for 107.00 otherwise chances of its come-back to 105.80 & 105.30 can’t be denied. Further, EURUSD’s bounce-off the immediate TL support, at 1.2295, may help the pair to revisit the 1.2370 & 1.2410 while a downside break of 1.2295 can drag the quote to 1.2240. At the end, GBPCAD’s reversal from 1.8050-40 horizontal-line favors its pullback moves towards 1.8130 & 1.8150 with 1.8000 being a follow-up level to watch if 1.8040 is broken.

Have a nice trading-day ……

FxAnil · April 3, 2018, 8:08am

Daily Fundamental Dose: 03 – April – 2018

Hello Traders,

Irrespective of softer than expected ISM Manufacturing PMI and on-going trade-war concerns between US & China, the US Dollar Index (I.USDX) managed to post a daily positive closing as holidays at majority of developed markets pushed investors towards the greenback when technology shares dropped the most since early February. While the U.S. trade protectionism was aptly retaliated by China, the NZD, AUD & CAD were badly hit due to their export-oriented nature whereas JPY & Gold benefited from macro pessimism on the back of safe-haven demand. Further, the GBP recovered some of its latest losses on the hope of BoE’s rate-hike but the EUR couldn’t lure the buyers with ECB’s recent shift in rate-lift preference. Additionally, Crude prices also slumped as expectations of rising US production & upcoming trade-war signaled further widening of supply glut.

After nearly four days of holidays, global investors returned to their desks on early Tuesday and responded to the trade-war fears and drop in technology shares with JPY & Gold buying. However, the mood seems changing off-late with the traders preferring EUR & GBP over the USD which the commodity-linked currencies, like AUD, NZD & CAD, took advantage of by registering some gains.

At the economic front, Reserve Bank of Australia (RBA) left its monetary policy unchanged, as expected, after today’s meeting. The central-bank said weakness in AUD is actually helpful for it reach the inflation target and deliver the much awaited rate-hike. As a result, the Australian Dollar (AUD) got additional strength to rise against majority of its counterparts. Moving on, monthly release of the UK Manufacturing PMI is likely an important detail to watch for the rest of the day while speech of one FOMC member, the Federal Reserve Bank of Minneapolis President Neel Kashkari, could offer clues for Fed’s rate-lift plan and can trigger intermediate market moves.

While economic calendar has fewer data-points/events to observe, investors’ come-back from long holidays, coupled with present trade-war concerns between the China & US, may result in a comparatively more volatile day for them than it was yesterday.

UK Manufacturing PMI is expected to soften to 54.8 from 55.2 and may drag the GBP a bit but overall optimism relating to BoE’s rate-hike & Brexit developments may keep fueling the Pound. In case of the USD, FOMC member might continue favoring increased pace of rate-lift target for the U.S. central-bank and may help the greenback. Moreover, latest communication from China seems looking forward for the healthy trade-talk with US in order to avoid any harm to both the economies and may as well provide a positive back-up to the USD and to export-oriented currencies.

Technical Talk

GBPUSD has to clear the 1.4090 immediate barrier in order to aim for 1.4130 otherwise it can re-test 1.4010 support while NZDUSD should confirm its recovery by conquering 0.7275 if it is to target 0.7310 else 0.7225 & 0.7200 can again be alive on the chart. As a result, the GBPNZD is likely coming back to 1.9340-25 support-zone, breaking which 1.9270 & 1.9200 can mark their presence while 1.9450 & 1.9500 may become nearby resistance to watch if the pair reverses from present levels.

Have a nice trading-day ……

FxAnil · April 4, 2018, 8:03am

Daily Fundamental Dose: 04 – April – 2018

Hello Traders,

While White House comments to cover the U.S. President Donald Trump’s twitter attacks on Amazon helped restore equity traders’ confidence on Tuesday, the US Dollar benefited from the news as market attention drew off the trade-war concerns. The EUR had to bear the burden of soft Final PMI numbers but the GBP stretched its recovery on upbeat Manufacturing PMI. Further, the AUD, NZD & CAD also marked gains as soothing worries for US protectionism helped these export-oriented economies’ currencies whereas safe-havens like Gold and JPY remained despicable on such optimism. Additionally, the Crude also recovered some of its latest losses as recent trade related tension and dip in API inventory numbers pleased energy traders.

Having witnessed some welcome developments on Tuesday, global investors again were dragged on US-China trade-war scenario during early Wednesday when the former announced a list of nearly 1300 Chinese products that will bear 25% tariff, totaling around $50 billion, as a part of its “America First” agenda. As a result, China quickly retaliated with statements indicating that they are also preparing the list of US products to be levied higher duties to counter the recent challenge on their exports to the world’s largest economy. As a result, markets started taking a toll on the US Dollar and safe-havens came up on the buyers’ list for one more time.

Even with escalation of trade tensions, AUD, NZD and CAD took advantage of the USD’s decline wherein Australian Retail Sales and Canada’s nearness to favorable NAFTA deal provided additional strengths to the Dollars of Australia & Canada. However, Crude couldn’t sustain its latest recovery due to global demand-supply imbalance likely to be affected by increase in US production amid trade-protectionism being a challenge to demand outlook.

Looking forward, UK Construction PMI, EU Flash CPI & US ADP Non-farm Employment Change are likely to entertain the market-players for the rest of the day while US Factory Orders, ISM Non-Manufacturing PMI & weekly Crude inventory may offer additional stats to keep making them busy.

Consensus suggest, a 50.9 number for the UK Construction PMI against 51.2 earlier while US ADP, an earlier signal for Friday NFP, may register 208K compared to 235K prior. Moving on, EU Flash CPI might please the EUR buyers with 1.4% inflation versus 1.1% previous whereas US Factory Orders can reverse earlier contraction of -1.4% with +1.7%. At the end, US ISM Non-Manufacturing PMI could hurt the greenback buyers by declining to 59.0 from 59.5 but the Crude oil inventory may help the energy-vehicle remain solid with 1.4M against 1.6M earlier.

Not only expected softness in economic data-points but the on-going trade-war between US & China may keep hurting the USD while JPY & Gold can benefit from such pessimism. In case of the EUR, the regional currency may regain its strength if the inflation figure rejuvenates ECB’s rate-hike concerns but the GBP had to witness another strong PMI to sustain its recent up-side. Furthermore, commodity-linked currencies like, AUD, NZD and CAD, can benefit from the USD weakness but global trade-related worries can confine their north-run.

Technical Talk

AUDUSD’s inability to sustain the 0.7710 break signals the pair’s re-test to 0.7670 & 0.7645 while an upside break of 0.7710 can help it target 0.7760. Further, the USDCAD seems taking a U-turn from 1.2770 and aim towards 1.2830 & 1.2860 but dip beneath the 1.2770 can fetch the quote to 50-day SMA level of 1.2725. For the EURCAD traders, a daily closing below 50-day SMA level of 1.5700 seems necessary for the pair to visit 1.5630 & 1.5570 else the 1.5745-55 and the 1.5815 may appear in the buyers’ radars to target.

Have a nice trading-day ……

FxAnil · April 5, 2018, 8:00am

Weekly Fundamental Dose: 05 – April – 2018

Hello Traders,

While US-China trade tensions have been threatening market optimism off-late, recently sluggish economic data-points from US & UK, contrast to strong EU CPI numbers, shifted the investors’ attention back to respective central-banks’ upcoming policy moves. As a result, slew of headline data-points from UK & US, namely British Services PMI & US NFP, coupled with speeches by Fed & BoE Chiefs, now become crucial for market players to follow.

Let’s discuss fundamentals concerning this details/events.

FOMC Members & US GDP Helped the Greenback

During last-week, strong outcome of US Q4 2017 GDP and hawkish comments from some FOMC members, together with improved relations with North Korea, helped the greenback to recover latest losses and mark a positive weekly closing. As a result, the EUR & GBP, which had very numbers to watch, ended up posting a negative week while JPY & Gold also witnessed pullback in safe-haven demand due to the USD’s strength. Further, currencies of the export-oriented economies, namely the AUD, NZD & CAD, remained sluggish with trade-war pessimism whereas Crude prices also dropped on increased US stockpile.

The Tale of Holiday Shortened Week & Trade War Concerns

Even if speculations for increasing pace of Fed rate-hike & better US-North Korean relations favored the USD in last-week, the greenback couldn’t sustain those gains so far during the present week as Mr. Trump presented details of nearly $50 billion additional tariffs on Chinese products, which was later on retaliated by the China with notice of preparing the list encompassing same magnitude of tariffs on the U.S. products. Moreover, some of the second-tier stats, namely ISM Manufacturing & Non-Manufacturing PMIs, Factory Orders and ADP Non-farm Employment Change, have also missed their marks and provided additional weakness to the US Dollar Index (I.USDX).

On the other hand, majority of the global markets were closed on Monday due to Easter holidays but when came back to Tuesday they recovered their prior week losses due to USD’s drop. Those moves then gained strength when UK Manufacturing PMI registered upbeat reading, which later on was challenged by soft Construction PMI, while strong EU Flash CPI unearthed the ECB’s rate-hike bets. Further, AUD, NZD & CAD also strengthened on greenback’s weakness & positive developments at NAFTA front while JPY & Gold regained risk-averse traders’ attention. However, Crude prices couldn’t reverse its downturn on fears concerning higher US stockpile and expected increase in the production.

The Turn In US-China Tensions & Economic Calendar Seem In Lime Light From Now

On late-Wednesday, US authorities conveyed their openness to talk with China in order to avoid any such tariffs being recently released, which in-turn provided fresh life to the USD on early Thursday against majority of its counterparts. Also, NAFTA talks seem coming to a good point from where all the three partners, namely US, Canada & Mexico, can benefit and the same helped boost investor confidence.

Moving on, today’s UK Services PMI & Trade Balance for US & Canada are likely to remain highlighted for the day before pushing analysts to observe tomorrow’s US NFP, followed by speeches from BoE & Fed leaders.

Starting with the UK Services PMI, the headline gauge is likely to post 53.9 mark against 54.5 whereas US Trade deficit might increase to -56.9B from -56.6B prior. The Canadian Trade Balance can also flash increased deficit of -2.1B compared to its -1.9B earlier. In case of US Employment stats, the NFP may disappoint the Bulls with 190K figure versus 313K previous but the drop in Unemployment Rate to 4.0% from 4.1% and the increase in Average Hourly Earnings to 0.3% from 0.1% could help soothe the greenback’s pains. In addition to the US jobs numbers, the Canadian Employment details are also scheduled for release tomorrow wherein the Employment Change could increase to 18.8K from 15.4K but the Unemployment Rate isn’t likely to deviate from 5.8% mark.

If we observe the speeches by Fed & BoE heads, the BoE Governor, Mark Carney is scheduled to speak at the International Climate Risk Conference for Supervisors, in Amsterdam whereas his US counterpart, Jerome Powell, is ready to appear at the Economic Club of Chicago. While Fed Governor is likely to maintain his hawkish stand, considering economic improvement, he can discuss the trade-war tensions and may end-up hurting the greenback. On the contrast, BoE Governor is less likely to be loud mouthed and favor another rate-hike which majority of market players are expecting at the moment.

To sum up, the recent turn in US-China relations and not so worrisome employment details could help the USD to extend its up-moves if Mr. Powell reveals his favor for increased pace of Fed rate-hike while GBP may have to take a loss if Carney refrains to discuss the chances of rate-lifts by the central-bank.

Further, the EUR can continue its latest recovery on CPI while commodity-linked currencies, namely AUD, NZD and CAD, are more likely to depend upon the USD’s moves than the trade-war developments which recently have soothed. Though, Canada’s employment details may be off greater importance to watch.

Technical Analysis

EURUSD is likely declining towards longer-term TL support of 1.2220, breaking which 100-day SMA level of 1.2140 should gain bears’ attention while 50-day SMA level of 1.2340, followed by 1.2420, can entertain counter-trend traders. GBPUSD is gradually rising towards 1.4150 and the 1.4210 with 1.4020, the 1.3985 and the 1.3920 seem nearby supports to watch during the pair’s dip. Further, USDJPY is struggling with 50-day SMA level of 107.10, breaking which it can rally to 107.90 while inability to surpass the same can reprint 106.00 & 105.30 on the chart. Additionally, AUDUSD has to clear 0.7740 in order to meet the 100-day SMA level of 0.7780 else chances of its drop to 0.7650 & 0.7610 can’t be denied whereas NZDUSD is running towards 0.7335 and the 0.7355 with 0.7250 & 0.7200 being immediate rest-points to observe. At the end, USDCAD has 50-day SMA level of 1.2730 and the 100-day SMA level of 1.2690 to conquer if it is to extend the present south-run otherwise it can witness pullbacks till 1.2800 & 1.2860 resistances.

Have a nice trading-day ……

FxAnil · April 6, 2018, 8:34am

Daily Fundamental Dose: 06 – April – 2018

Hello Traders,

Thursday proved to be a good day for the USD Bulls as receding fears of a trade-war between US & China, ascertained via White House officials’ readiness to talk with their Chinese counterparts, helped the greenback to recover some of its latest losses and ignore an uptick in Jobless Claims together with higher Trade deficit number. The GBP traders were disappointed by lowest Services PMI since August 2016 whereas softer than expected print of Final Services PMI from EU dragged the EUR to south. Further, the AUD and NZD dropped as stronger US Dollar negatively affected commodity basket but the CAD managed to extend its north-run due to positive developments on the NAFTA talks. Additionally, Gold and JPY couldn’t remain immune to the USD’s strength and declined while Crude prices witnessed some profit-booking as fading trade-war concerns favored higher global energy demand going forward.

While White House member tried soothing trade fears and pleased investors during yesterday, US President Donald Trump performed another act of trade protectionism at the day-end by ordering his administration to prepare additional tariff-list to be levied on nearly $100 billion of Chinese products. As a result, the previously built optimism was conquered and the USD again traded south-wards around the beginning of Friday. With this, the Crude also declined but there was no recovery in AUD, NZD and the CAD as the news seem negative for such export-oriented economies.

Having responded negatively to the US announcements, trader fraternity rejoined yesterday’s move in favor of the US Dollar after the US official again came forward by saying US is ready to talk to China about trade tariff settlements. Additionally, today is the NFP day and hence market-players are being cautious about their open trades.

With the trade fears’ on-off movement already threatening investors, today’s employment details from US & Canada, followed by speeches by BoE & Fed Chiefs, become additional burden on the analysts to observe.

If we look at the forecasts for job numbers, the US NFP may hurt the greenback with 188K figure versus 313K previous but the drop in Unemployment Rate to 4.0% from 4.1% and the increase in Average Hourly Earnings to 0.3% from 0.1% could help soothe the greenback’s pains. In addition to the US jobs numbers, the Canadian Employment details are also scheduled for release tomorrow wherein the Employment Change could increase to 18.8K from 15.4K but the Unemployment Rate isn’t likely to deviate from 5.8% mark.

In case of the speeches, the BoE Governor is less likely to be impressed with economics considering latest dip in Services PMI & might try conquering the rate-hike bets, which in-turn could drag the GBP to south while the Fed Governor, Jerome Powell, may avail this opportunity to convey his economic optimism but might not ignore the trade-fears. As a result, the USD needs to have positive on both the sides, namely employment stats & speech tone, in order to remain strong by the weekend.

Hence, not only employment stats but the speeches by central-bankers & the US-China trade-war developments are also important catalysts to observe for the day.

Technical Talk

EURUSD re-tests a year-long ascending trend-line support, at 1.2230 now, which if broken might not hesitate dragging the pair to 1.2180 and then to the 100-day SMA level of 1.2145 whereas 1.2260 & 1.2300 can restrict the quote’s immediate upside. On the contrary, USDCHF’s latest recovery might is likely to be challenged by multiple resistances around 0.9655-65 area, comprising 200-day SMA & horizontal barrier, which in-turn can fetch the pair to 0.9610 and then to the 0.9570. Moving on, 100-day SMA level of 0.7565 is likely strong resistance that might trigger the CADCHF’s pullback towards 0.7515-10 support-zone with 0.7610-15 being adjacent resistance.

Have a nice trading-day ……

FxAnil · April 9, 2018, 8:34am

Daily Fundamental Dose: 09 – April – 2018

Hello Traders,

Irrespective of rising US-China trade tensions and sluggish economics from the U.S., comprising monthly Jobs report, the US Dollar Index (I.USDX) managed to post second consecutive weekly gains during last-week as Federal Reserve policymakers, including the Fed Chair, maintained their view in favor of gradual rate-hikes and talked down trade fears. On the contrary, the EUR couldn’t benefit from upbeat CPI due to disappointments from German data-points but the GBP continued being strong on BoE Governor’s praise to UK’s economic recovery that now warrants further rate-hikes. Further, the AUD had to decline on softer Chinese Caixin Manufacturing PMI & RBA’s refrain to welcome policy-change but the CAD & strengthened with progress at NAFTA deal whereas NZD recovered on softer than expected decline in GDT Price Index. Moving on, the JPY had to drop against the USD because of weaker stats while Gold benefited from global pessimism concerning trade future between the U.S. & China. Moreover, the Crude prices also plunged on speculations that trade-war could hit the energy demand at a time when US output continues growing.

While politics and economics both played their roles during last-week, US diplomats again took a U-turn during late week by favoring behind-the-scene talks with China in order to tame the present tensions between the two. Also, North Korea publicly showed its readiness to talk on denuclearization when their leaders meet. Hence, receding geo-political tensions helped the USD extend its gains during early Monday and negatively affected the safe-havens, namely JPY & Gold. Though, news that U.S. forces had struck a major air base in Syria, which US denied, continued supporting the risk-off mood. At the economic front, German exports surprisingly slumped to the lowest in more than two years and provided additional weakness to the EUR whereas softer Consumer Confidence & Current account details dragged JPY further towards south.

Looking forward, today’s economic calendar has very few details/events scheduled for release that includes Canadian Housing Starts, BoC’s quarterly Business Outlook Survey and New Zealand’s quarterly NZIER Business Confidence. Also, the BoJ Governor, Hruhiko Kuroda, is up for giving a speech at the start of his second term as the central-bank leader and might give hints on the Japanese bank’s future course of action.

Observing the data-points, the Canadian Housing Starts may add weakness into the CAD with 219K mark against 230K prior but the BoC’s Business Outlook Survey may praise latest developments at NAFTA and rise in crude prices to help the Canadian Dollar. In case of the NZD, the quarterly print of Business Confidence dropped to the lowest since October 2015 in its earlier release and may recover a bit to please the Kiwi buyers. At last, the JPY may recover its latest losses due to on-going trade-war situations and expected hawkish tone of the BOJ Governor.

Hence, not only economics from Canada & New Zealand are there to entertain traders, political news emanating from US, China & Japan can keep pleasing the momentum traders.

Technical Talk

USDCAD’s bounce off the 50-day SMA might has to conquer the 1.2810 in order to aim for 1.2860 & 1.2930 otherwise 1.2745 & 1.2680 can reappear on the chart. Further, NZDUSD should surpass 0.7320 if it is to aim for 0.7355 else 0.7270 & 0.7240 may come-back as quotes. At last, more than a month-long descending trend-line, at 131.65 now, continue being near-term strong resistance for the EURJPY, breaking which it can rise to 131.80 & 132.35 while 130.85 & 130.60 seem immediate supports to watch in case if the pair takes a U-turn from present levels.

Have a nice trading-day ……

FxAnil · April 10, 2018, 8:04am

Daily Fundamental Dose: 10 – April – 2018

Hello Traders,

Monday couldn’t offer a good week-start to the USD as new projections from the nonpartisan Congressional Budget Office predicted that the U.S. Government’s annual budget deficit will reach $1 trillion in 2020, two years before previous forecast, which in-turn raised concerns for the Fed’s future rate-hikes and probable actions by the Trump administration. Additionally, Special Counsel Robert Mueller’s investigation of Russian meddling in the 2016 US Presidential Election took a new turn by raiding the office of President Donald Trump’s longtime lawyer, Michael Cohen. Due to this, the US Dollar Index (I.USDX) had to register a negative daily closing and the same helped JPY & Gold to recover some of their latest losses. The EUR also benefited from the greenback’s decline even if some of the ECB policymakers signaled slower move towards the end of stimulus & tighter monetary policy whereas GBP rose after UK Halifax HPI rallied to the highest since January 2017. Further, the AUD, NZD and CAD also strengthened on USD’s weakness and chances of easing trade-war tensions between the world’s two biggest economies, which in-turn helped Crude witness profit booking after Friday’s plunge.

During early Tuesday, the NZD rallied on lesser than prior contraction in NZIER Business Confidence but the AUD had to gulp down soft NAB Business Confidence mark. However, major market attention was on the Chinese President Xi Jinping’s speech at Boao which soothed investor tensions over the U.S.-China trade-wars by promising some relaxation to US imports including cars and showing readiness to talk about the issue rather than favoring further protectionism. As a result, global market sentiment favored risk-on mood and helped USD by hurting the JPY & Gold prices. Moreover, currencies of the export oriented economies, like AUD, NZD and CAD, and the Crude prices grew stronger as easing trade protectionism is a big positive for them.

While Xi’s speech was performing its magic on global traders, U.S. President also showed optimism to diffuse trade tensions, which in-turn offered additional strength to the USD. However, the greenback’s gains were confined by uncertainty over the Robert Mueller’s investigation and Federal Reserve Bank of Dallas President Robert Kaplan statement showing worries about the trade issues to hurt the central-bank’s future policy moves.

Looking forward, aftershocks of the Chinese President’s speech and political turmoil concerning US are likely to keep offering intermediate trade opportunities for the rest of the day whereas Canadian housing market numbers & US PPI could gain major attention of the CAD & USD players. Moreover, Facebook ECO Mark Zuckerberg is ready to testify at two Congressional hearings during Tuesday & Wednesday that could affect the global tech-giants.

If we observe forecasts concerning the Canadian details, Housing Starts might soften to 219K from 230K prior while the Building Permits’ growth could tank in negative region by flashing -1.5% mark against +5.6% earlier expansion. Further, the U.S. PPI is also expected to remain weaker than its previous announcement of +0.2% by registering +0.1% mark but the Core PPI is likely to be unchanged at 0.2% figure.

Considering the recent signs of easing trade-tensions between the U.S. & China, coupled with not so disappointing PPI figure, the USD & commodity currencies, like AUD, NZD &CAD, may gain some strength but Robert Mueller’s investigation & Facebook CEO’s testimony, wherein he is likely to accept his mistake in data-leak, might prove be the US Dollar negative.

Technical Talk

AUDUSD’s break of immediate TL resistance favors its further upside to 0.7755 & 0.7770 with 0.7715 & 0.7690 being nearby supports to watch. Further, USDJPY also bounced off adjacent trend-line support and may challenge 107.50 for one more time, breaking which it can rise to 108.00 but a downside break of 106.60 might not hesitate reprinting the 106.00 mark. At the end, AUDJPY is successfully trading beyond TL resistance and seems aiming for 83.25 & 83.45 with 81.85 & 81.20 likely gaining market attention if the pair reverses from present levels.

Have a nice trading-day ……

FxAnil · April 11, 2018, 8:22am

Daily Fundamental Dose: 11 – April – 2018

Hello Traders,

With the Chinese President’s readiness to defuse trade dispute vis-à-vis the U.S., followed by Donald Trump’s conciliatory remarks, global investor sentiment got a boost on Tuesday while Facebook CEO’s defense to his social network company and acceptance of mistake further added to the risk-on mood. As a result, equities once again became traders’ favorite and the same did hurt the US Dollar Index (I.USDX) for one more day. Moreover, currencies of export-oriented economies, like AUD, NZD and CAD, rallied sharply on easing global trade tensions whereas the GBP benefited from recently upbeat tone from the BoE.

Even if the Chinese news soothed investor fears, Geo-political tensions in Middle-East, mainly emanating from Syria, coupled with the USD’s weakness helped the Gold maintain their allure while JPY had to bear the burden of weak Machine Tool Orders. In case of the EUR, the regional currency managed to shine not only because of the USD’s drop but also due to the comments from European Central Bank policymaker Ewald Nowotny that raised speculations for the end of central-bank’s 2.55-trillion euro bond buying program. Above all these, Crude prices managed to ignore higher than expected API stockpile results & fears of rising American production as improved global trade sentiment and Geo-political fears pleased the energy traders. It also be noted that the USD couldn’t praise an uptick in PPI and the CAD shifted its eyes off the sluggish housing market details.

While yesterday was quite an upbeat trading time for market-players, start of Wednesday continued praising US-China’s latest developments due to lack of fresh impetus. Though, the same couldn’t last long when Japanese PPI tested the lowest levels since July 2017 and China’s inflation numbers, namely CPI & PPI, also softened. With this, the commodity basket and the crude witnessed pullbacks after yesterday’s heavy rise but the JPY didn’t dip as BoJ Governor recently welcomed improvements in inflation pressure into the economy.

After the release of Chinese & Japanese inflation numbers, the US CPI & UK Manufacturing Production, coupled with FOMC minutes, appear in the analysts radars to observe. Herein, the UK Manufacturing Production may please the GBP buyers with 0.2% growth against 0.1% earlier while the US CPI could keep troubling the rate-hike bulls with monthly figures bearing a forecast of 0.0% mark against 0.2% while yearly gauge likely flashing 2.4% mark compared to 2.2% earlier. Further, the Core CPI may remain unchanged at 0.2% MoM but may rise to 2.1% against 1.8% prior when looked at yearly number.

For the FOMC minutes, some of the Fed policymakers have started showing their concerns for trade-disputes affecting the central-bank’s future moves and hence details of the same in minutes statements will be closely observed in addition to the decision-makers’ favor to four rate-hikes a year.

Hence, while inflation numbers are showing mixed signals for the USD, FOMC minutes may help the greenback regain its strength if policymakers keep supporting increased pace of rate-hike and give little importance to the trade-noise.

At the Geo-political front, US & its western peers, mainly Russia, are preparing for strikes on Syria if the situation at the nation doesn’t improve soon while Eurocontrol flagged warning sign for its airlines flying near the eastern Mediterranean region due to possible air strikes. Furthermore, the Facebook CEO is again to appear before US Congress for second-day of his testimony and has to please the leaders if it is to maintain its present stage of world’s largest social media company.

Should concerns at Syria continue pushing global leaders towards strong measures, the JPY & Gold may keep gaining while USD may have to decline for a bit longer. However, the same is less likely to become a barrier for AUD, NZD and CAD unless the US Dollar improves on the back of scheduled data-points/events.

To sum up, while yesterday was an upbeat and active day for traders, today’s scheduled details/events, coupled with Geo-political issues, can keep fueling the market moves.

Technical Talk

With its successful trading beyond 1.2350, the EURUSD seems all set to claim the 1.2420 TL resistance, breaking which 1.2440 & 1.2480 can entertain the Bulls while a downside break of 1.2350 may reprint 1.2310 as quotes. Further, the GBPUSD is near to 1.4245-50 important resistance region that may curb its further upside towards 1.4310 and can drag it back to 1.4140 & 1.4100. Additionally, GBPCAD recently took a U-turn from 50-day SMA and may revisit 1.7960 & 1.8000 with closing break of 1.7845 SMA likely fetching it to 1.7760.

Have a nice trading-day ……

FxAnil · April 12, 2018, 8:19am

Weekly Fundamental Dose: 12 – April – 2018

Hello Traders,

US CPI rallied to the highest in a year, FOMC minutes showed concern for a trade-war while being optimistic about the rate-hikes and the Chinese President stood ready to calm down trade disputes with the U.S. Moreover, Facebook CEO accepted his mistake in handling user-data and successfully emerged from two days’ congressional hearings.

With all the aforementioned details/events are already out and loud in the market, what’s left for investors to observe is presently active Geo-political tensions emanating from Syria that has pushed US to go against Russia if it tries to safeguard the Middle-East nation. Also, some of the trade leaders from China recently took a U-turn from their President’s speech by saying that those words were for longer-term plan. Hence, lack of big releases could well be compensated by Geo-political plays whereas second-tier details from US & China can offer intermediate trade opportunities for the rest of the week.

It would be better to discuss what’s happened in the global forex frontier till now ahead of discussing the fundamentals for upcoming trade sessions.

“Buy The Rumors, Sell The News” Describes Last-Week’s Momentum

Yes, the famous saying of market seems correct if we observe last-week’s USD moves. Even after witnessing not so welcome job numbers and trade-war threats from China, the greenback managed to register a consecutive second weekly positive closing. Some much discussed reasons are hawkish tones of the Fed policymakers, including the Fed Chair, which support increased pace of rate-hike and receding fears from North Korean after the hermit kingdom stood ready to discuss denuclearization when it meets US sometime next month.

While US Dollar managed to rise on speculations, the EUR had to forgo upbeat EU Flash CPI because of sluggish German details but the GBP took benefit of market bets favoring BoE’s rate-hike in the next-month. Further, the AUD couldn’t sustain RBA’s willingness to hold monetary policy unchanged while the CAD benefited from developments at NAFTA front. Moving on, JPY had to bend down in front of the USD whereas rising trade disputes fueled Gold’s safe-haven demand. At the end, Crude prices also declined on uncertainty over future demand if trade-war issues become serious together with increasing US production.

Political Plays Hurt The USD During Present Week

Even if speculations concerning the Fed rate-hikes were backed by upbeat CPI & FOMC minutes, the US Dollar couldn’t sustain its earlier gains so far during the present week as political waves from Syria and Robert Mueller’s investigation dragged the greenback down. To talk them in detail, US President warned Russia if it comes to save Syria when the U.S. hits the nation for use of chemical weapons whereas Robert Mueller’s investigation became more serious when Mr. Trump’s long-time lawyer had to face the consequences.

In addition to the political factors that have been hurting the USD, improvements at equity markets due to Facebook CEO’s successful testimony provided another reason for the traders’ fraternity to prefer stocks over the currency.

As a result, the USD’s decline were aptly being capitalized by the EUR, which had least details to rely on, whereas GBP respected shrink in Goods Trade Balance deficit by ignoring a contraction of Manufacturing Production. The NZD & CAD remained strong as weaker US Dollar favored commodity currencies but the AUD had to bear the burden of sluggish Chinese PPI & weaker data-points at home. In all these, the JPY & Gold were clear winners of the week with the Crude prices also rising on the back of expectations that Geo-political problems may hurt the future supply when China has opened up for demands.

What Next?

Looking forward, Thursday’s weekly Jobless Claims & Friday’s Preliminary reading of UoM Consumer Sentiment are the details that could affect the USD while Friday’s Chinese Trade Balance may direct near-term commodity moves.

Forecast suggests 231K mark of the US Jobless Claims against 242K prior with the Preliminary UoM Consumer Sentiment likely declining to 100.6 from 101.4 earlier. Further, the China’s Trade Balance can trigger the commodity basket’s pullback if it meets the 179B consensus against 225B previous surplus.

At the political front, Saudi Arabia added fuel into the already burning issue of Syrian attacks by saying it identified a ballistic missile coming towards Riyadh while dismantling two drones in another part of the country. The U.S. President, Donald Trump, seems all in mood to launch missiles at Syria and is ready to even confront Russia when some of his western counterparts are already in his support. Moreover, Robert Mueller’s investigation continue to offer pains to Trump administration and the recent U-turn by Chinese trade-leaders mentioning that they are ready to retaliate the $150 billion US tariffs could continue supporting risk-off market mood.

Hence, while majority of the scheduled data-points are already out and hasn’t helped the USD, chances of the remaining to have lesser strength in turning over the greenback’s losses are too low. Moreover, present geo-political tensions could provide additional drag to the US currency if US become too furious with Syria, which in-turn may help the JPY & Gold.

For commodity-linked currencies, like AUD, NZD & CAD, the Chinese data-point may become an added disadvantage but weaker USD, rising Crude and developments at NAFTA can help them being strong. In case of the EUR & GBP, both of them has lesser catalysts to follow then offering counter-moves to the USD.

Technical Analysis

For EURUSD, break of the 1.2420 TL resistance can open the door for the pair’s rally towards 1.2510 with 1.2330 & 1.2280 being nearby supports while GBPUSD has 1.4245 & 1.4285 resistances to clear in order to meet the 1.4345 else chances of its pullback to 1.4100 and then to the 1.4015 can’t be denied. Further, USDJPY has 106.60 & 107.50 range with 105.80 & 108.00 being follow-on numbers to watch while USDCAD seems bouncing off the 1.2550 support and may revisit the 100-day SMA level of 1.2690. Moreover, 50-day & 100-day SMA confluence region of 0.7785-90 can keep indicating 0.7725 re-test for the AUDUSD but the NZDUSD is likely running towards 0.7435 unless closing beneath the 0.7320 support.

Have a nice trading-day ……

FxAnil · April 13, 2018, 8:10am

Daily Fundamental Dose: 13 – April – 2018

Hello Traders,

While conciliatory statements from US & Chinese Presidents seem already playing their roles in defusing global trade tensions, surprise announcement from the Trump administration that Mr. President may rejoin TPP (Trans-Pacific Partnership free-trade deal) if offered better terms provided additional strength to the investor sentiment and helped the USD on Thursday. Not only USD but the AUD and NZD also registered gains after such news that could propel their export-oriented economies but the CAD had to trim some of its latest strength with NAFTA talks again being uncertain. Further, decline in EU Industrial Production dragged the EUR but the GBP remained firm on speculations of a rate-hike as soon as next month. Due to easing trade worries and absence of any new actions by the U.S. & its western counterparts for the Syria, resulted risk-on mood dragged the JPY & gold towards south whereas Crude prices continued being up on upbeat future demand outlook.

With the recent U-Turn by the U.S. President on trade terms, global traders took a sigh of relief and carried on the moves during early Friday when US earning season has already offered good outcomes on the previous-day. However, there was a change in market mood as equities remain more in demand than those of the currencies and hence USD & JPY both witnessed downside.

In case of economics, early-day release of Chinese Trade Balance disappointed commodity traders initially before they knew New Year Holiday was the reason restored their buying bets on the AUD, NZD and the CAD as well. The Crude adhered to a decline as receding Geo-political problems unearthed fears of higher US production.

Moving on, US earning season has JP Morgan & Citi Group’s result lying on the card for today while Preliminary reading of UoM Consumer Sentiment & JOLTS Job Openings could decorate US economic calendar for the rest of the day. Forecasts suggest a 100.6 print of consumer sentiment gauge against 101.4 prior while the JOLTS Job Openings may also mark a softer figure of 6.11M compared to 6.31M earlier. Though, the headline financial service providers are expected to please investors with upbeat earnings.

Hence, while economic data-points may fail to offer noticeable strength to the USD, welcome earnings report and optimism at trade front could become reasons for the greenback’s end of the day strength.

It should also be noted the JPY is less likely to register gains unless any new Geo-political fear while AUD, NZD and CAD, can keep enjoying the positive trade environment related news. Further, EUR may become victim of recently sluggish data-points but the GBP could maintain its strength on rate-hike expectations.

Technical Talk

USDCHF again took a U-turn from 0.9645-50 resistance-region and may revisit 0.9550 & 0.9520 whereas an upside break of 0.9650 can flash 0.9670 & 0.9700 as quotes. Moving on, USDJPY’s break of 107.50 enables it to claim the 108.00 and the 108.50 but a dip beneath 107.50 can recall 107.10 support. Moreover, EURCAD is struggling around the 1.5510-05 horizontal-support with oversold RSI continues signaling the pair’s pullback to 1.5550 and then to the 1.5600 unless closing below 1.5500 round-figure, which if happens might not hesitate highlighting the 1.5445 rest-point.

Have a nice trading-day ……

FxAnil · April 17, 2018, 8:01am

Daily Fundamental Dose: 17 – April – 2018

Hello Traders,

With the dip in Empire State Manufacturing Index & news that the U.S. President Donald Trump accused Russia & China of devaluing their currencies weighing down the US Dollar in spite of upbeat Retail Sales, the US Dollar Index (I.USDX) register another negative daily closing on Monday which in-turn was aptly capitalized by the EUR & GBP. The AUD, NZD & CAD portrayed receding trade-tensions between US & China by posting gains while JPY also strengthened on rough-patches amongst Russia & US. Further, the Crude prices dropped heavily as soothing tensions at Syria & increasing US output again dragged the energy down while Gold benefited from the USD’s decline.

During early Tuesday, the USD recovered some of its latest losses as news broke that US President is likely to step back from new sanctions on Russia. However, the JPY didn’t lose its strength as the Japanese PM is on a two-day visit to the U.S., which in-turn continue fueling trade-related tensions. Moving on, the AUD rose even after RBA minutes expressed concern for lower inflation due to strong Chinese GDP but gains of other commodity-linked currencies, like NZD & CAD, were limited due to softer than expected print of China’s Industrial Production. The CAD got additional strength from the Crude prices, which reversed majority of prior declines on expectations of a dip in crude inventory & escalating tensions between Iran & Venezuela.

Looking forward, JPY, EUR & GBP are likely to gain most market attention due to factors such as Japanese PM’s US visit, EU ZEW Economic Sentiment releases and UK employment stat outcome. Moreover, US Housing Starts & Building Permits, together with Industrial Production, can also offer intermediate trading opportunities. Hence, all in all it can be considered as another data-packed day for investors to observe.

While UK Average Earnings might please the GBP Bulls with 3.0% mark against 2.8% prior, increase in Claimant Count Change to 13.3K from 9.2K, coupled with unchanged Unemployment Rate of 4.3%, may act as negatives for the Pound. In case of EU ZEW Economic Sentiment, the regional confidence gauge may plummet to the lowest since September 2016 with its 7.3 expected number versus 13.4 previous. Further, the U.S. Housing details continue showing strength of US housing market with Building Permits likely flashing 1.33M mark against 1.30M and the Housing Start expected to punch 1.27M versus 1.24M earlier. Though, softness in US Industrial Production growth, to 0.3% from 1.1%, can continue hurting the greenback.

At the political front, developments concerning the talks between US & Japanese leaders and Russian comments on Trump’s latest U-turn, coupled with trade talks surrounding TPP, NAFTA & China, could keep offering active trading sessions on traders.

Given the upbeat UK data-points, chances of the BoE’s rate-hike next month could become stronger and may fuel GBP further towards north while soft EU facts may become reason to confirm the ECB’s latest dovish statements. Moreover, mixed US details and Geo-political problems can keep hurting the greenback whereas JPY, Gold & commodity-link currencies can benefit from the same.

Technical Talk

GBPUSD just conquered the 1.4350 barrier, which in-turn indicates its rally towards 1.4420 & 1.4470 while a downside break of 1.4350 may drag the quote back to 1.4310 & 1.4280. Further, the USDJPY is likely revisiting the 50-day SMA level of 106.70, breaking which 106.45 can come-back on the chart while 107.30 & 107.50 may act as nearby resistances for the pair. At the end, the CADCHF may witness pullback in direction to 0.7615-10 and then to the 100-day SMA level of 0.7555 due to its inability to surpass the 200-day SMA level of 0.7645, which if broken could propel the pair to .7675 & 0.7705.

Have a nice trading-day ……

FxAnil · April 18, 2018, 6:28am

Daily Fundamental Dose: 18 – April – 2018

Hello Traders,

Be it welcome figures of the U.S. Housing market & Industrial Production or encouraging start to the earnings season, not to forget about hawkish statements from New York Fed’s next President, John Williams, the US Dollar has it all to post its first positive daily closing in previous three-days on Tuesday. The EUR, however, had to drop because of disappointing ZEW Economic Sentiment while GBP couldn’t sustain its post-Brexit high due to weaker-than-expected wage details. Further, the AUD and the NZD bent down against the stronger USD but rise in Crude prices, as a result of decline in API inventory, helped the CAD to maintain its gain. While USD’s strength was adversely affecting rest of the major currencies, JPY & Gold seemed immune to be up as background Geo-political tensions concerning US trade-related issues with China & sanctions on Russia, coupled with Japanese PM’s visit to the U.S., kept favoring market demand of the safe-havens.

While everything was going in favor of the US Dollar on Tuesday, later-day news that US President Donald Trump is now not interested to join the TPP due to too many contingencies and the IMF signaled near-term downside risk to the global economy due to trade-protectionism provided additional strength to the JPY & Gold. Though, the same couldn’t last long after it was known that one of the top White House member made a secret visit to North Korea in order to discuss plans with Kim Jong Un for President Trump’s meet. Hence, the market risk-on was rejuvenated and dragged the safe-havens to the south.

Other than the North Korean news, upbeat US details & optimism at Wall Street, slower export growth at Japan and negative print of Australia’s MI Leading Index were additional reasons to fetch the JPY, AUD & Gold further towards south.

Moving on, today being the scheduled releases of headline inflation figures from UK, EU & New Zealand, investors might put less importance on the Geo-political issues and may rejuvenate monetary policy talks. Other than CPI, monetary policy meeting by the Bank of Canada & comments from few FOMC members could also offer intermediate trade opportunities.

Forecasts suggest unchanged figures of 2.7% & 1.4% respectively for UK CPI & EU Final CPI whereas the New Zealand’s quarterly CPI may improve a bit to 0.4% from 0.1% earlier. Further, the BoC isn’t expected to alter its present monetary policy but latest Canadian economics and rise in Crude push analysts to expect an interest-rate hike during its next-month meeting. Hence, Loonie buyers may seek clues relating to the central-bank’s upcoming moves in order to predict CAD trend.

Should EU inflation fail to register any noticeable change, the EUR is likely to be hurt as the ECB has recently started showing disinterest in monetary policy tightening while strong UK CPI could propel the GBP on BoE’s rate-lift bets and the NZD may also benefit from higher inflation. Further, the CAD can lose its strength if either the BOC disappoint Loonie Bulls and/or the Crude inventory register unexpected increase whereas USD can also remain strong if the FOMC members keep singing the tune relating to increased pace of Fed’s rate-hike. In all this, the JPY & Gold may have to trim some of their latest gains.

Technical Talk

Break of immediate ascending trend-line signals the NZDUSD’s drop to 0.7320 and then to the 0.7300 with 0.7345 & 0.7370 being nearby resistances. In case of the USDCAD, the pair has to conquer 1.2625 in order to aim for 1.2700 & 1.2730 otherwise chances of its south-run to 1.2525 & 1.2480 can’t be denied. The EURJPY might find it hard to extend its recent up-moves towards 133.80 unless breaking the 133.00-133.10 resistance-confluence while 132.15 & 131.50 may offer immediate supports to the pair.

Have a nice trading-day ……

FxAnil · April 19, 2018, 7:42am

Weekly Fundamental Dose: 19 – April – 2018

Hello Traders,

Although dissipating Geo-political tensions and latest improvements in US stats have pleased the US Dollar Bulls off-late, few economics are left for publish during the rest of the week and the same may confine global forex moves while going forward. However, this doesn’t mean dull trading-days, which in-turn emphasizes the importance of discussing underlying fundamentals.

Though it’s always better to discuss what has happened in the market before shedding light on the forecasts.

Trump’s Attitude Superseded Upbeat CPI & FOMC Minutes Last-Week

Irrespective of welcome CPI & hawkish FOMC minutes, the US Dollar Index (I.USDX) couldn’t manage to post a weekly positive closing during last-week as US President Donald Trump continued threatening Syria and Russia over alleged chemical attacks in the former country. With this, the EUR managed to shine without any big positives whereas GBP rallied on speculations concerning the BoE’s rate-hike. Further, AUD, NZD & CAD also benefited from the greenback’s weakness & optimist statements from Chinese leaders but the JPY witnessed pullback on political pessimism at the home-land. Moving on, the Gold surged with safe-haven demand while Crude took advantage of the Middle East tensions.

So Far So Good For The USD

Having witnessed a negative weekly closing and a weak start, mainly due to the joint air-strike over Syria by US, UK & France, the US Dollar started recovering some of its latest losses on the back of receding Geo-political tensions and upbeat data-points whereas hawkish statements of Beige Book provided additional strength to the currency. The EUR had to trim its gains over USD’s strength and disappointing ZEW economic sentiment while softer than expected CPI dragged the GBP towards south on expectations that the BoE may refrain from another rate-hike during its much anticipated meeting in May. Moreover, JPY also regained its strength on risk-safety when Japanese PM was on two-day US visit and the same helped the Gold to maintain its up-moves. Though, CAD had to confront the short-covering as BoC refrained from giving any strong signals for its next rate-hike and the NZD declined with softer than expected CPI mark on a yearly basis while AUD sustained its last-week’s U-turn as receding Geo-political tensions and welcome Chinese numbers fueled the Aussie. At the end, Crude prices surged as depleting US inventory and the U.S. readiness to re-introduce sanctions on Iran pleased energy traders.

Political Plays Are High But Economics Are Low

Looking forward, economic calendar has very few stats remaining for publish but recent threats from China to retaliate US trade protectionism & Trump’s another U-turn to dump North Korean talks if it isn’t fruitful, coupled with his spat with Russia, could keep entertaining investors.

In case of the economics, Thursday’s UK Retail Sales and US Philly Fed Manufacturing Index could help foresee GBP & USD’s respective moves after soft AU Job numbers have hurt the AUD. Moving on to the Friday, Canadian CPI & Retail Sales are the only release to observe.

The UK Retail Sales are expected contract by -0.5% against +0.8% earlier while the U.S. Philly Fed Manufacturing Index can post 20.8 mark compared to 22.3 prior. Further, the Canadian CPI is likely to decline to 0.4% from 0.6% MoM but the yearly figure may please CAD Bulls with 2.4% mark against 2.2%. Further, the Retail Sales growth is also expected inflate to 0.4% from 0.3%.

At the Geo-political front, China seems ready to answer the US trade protectionism with harsh sanctions and that may rejuvenate trade-war concerns whereas Trump’s eagerness to extend Iran sanctions and bestow more restrictions on Russia, coupled with developments at North Korean front, could keep making traders on edge. It should also be noted that two-day IMF meetings will start from Friday and US-Japan meet seemed successful after the Japanese PM agreed to discuss two-way trades with his US counterpart.

To sum up, weak UK Retail Sales may magnify recently rising concerns that the BoE may disappoint GBP Bulls while upbeat US figure may help the USD to remain firm if Mr. Trump try to make peace with China, North Korea & Russia.

Moving on, the CAD seems extending its latest short-covering if headline stats match consensus but gains at the Crude front may curb its heavy decline. Additionally, the JPY & Gold may keep benefiting from global geo-political concerns unless US leader soothes the market pessimism and/or IMF meeting turn out to be a welcome event, which is less likely considering present trade-protectionism & Geo-political threats.

Technical Analysis

EURUSD continues struggling with the month-long descending TL, at 1.2380 now, breaking which 1.2480 & 1.2510 can reappear as quotes while GBPUSD recently broke the 1.4285 trend-line support and may re-test the 1.4140 & 1.4100 rest-points with an upside break of 1.4285 reigniting the importance of 1.4380. The USDJPY seems all set to challenge the 107.80 & 108.10 resistances unless breaking 106.85 support-line that can fetch it to 106.10 whereas USDCAD has to surpass 100-day SMA level of 1.2680 in order to aim for 1.2755-60 otherwise chances of its drop to 1.2580 & 1.2540 can’t be denied. Furthermore, AUDUSD’s break of 100-day SMA can help it target the 0.7850 given its closing beyond 0.7780 else it can come-back to 0.7730 but the NZDUSD is indicating extended dip to 0.7300 & 50-day SMA level of 0.7285 while 0.7345 & 0.7400 act as immediate resistances for the pair.

Have a nice trading-day ……

FxAnil · April 20, 2018, 10:30am

Daily Fundamental Dose: 20 – April – 2018

Hello Traders,

While news that U.S. Treasury Department is looking to use an emergency law to curb Chinese investments in sensitive technologies did hurt the USD during early Thursday, surprise announcement by the BoE Governor, in his BBC interview, that next month’s rate-hike by the central-bank isn’t a done deal dragged the GBP down and offered counter-strength to the greenback. Additionally, upbeat prints of US Philly Fed Manufacturing Index provided extra strength to the U.S. currency. As a result, the EUR witnessed selling pressure considering the ECB’s latest dovish comments while the JPY and Gold declined on US Dollar’s strength. Further, currencies of export-oriented economies, like the AUD, NZD and CAD, adhered to south due to pessimism concerning global trade and soft data-points at home while Crude had to dip from its fresh highs since late-2014 as expected increase in US production & curb on global trade gave rise to the energy’s profit-booking.

During early Friday, Chinese ambassador to the U.S. said that the China will retaliate if the United States insists on initiating a trade war and provided additional weakness of the AUD, NZD and CAD. Further, the JPY also extended its previous downside with softer than expected National CPI whereas USD maintained recent strength on rising treasury yields & optimism for the Fed’s rate-hike, as communicated by some FOMC members in their recent public appearances.

Moving on, IMF and World Bank meetings will be in the investors’ radar during later-today while developments on US-China trade issues, coupled with Canadian CPI & Retail Sales, may also become catalysts for the day.

Given the present trade-protectionist environment in global economy, the IMF & World Bank meetings can offer a stage to some of the influential leaders to communicate their disagreements with the same, which in-turn could hurt the USD and may again favor the safe-havens like JPY & Gold. However, Trump’s surprise step back from levying additional controls on the Chinese investments & product, together with optimism at Fed, may help the greenback maintain its strength.

In case of the CAD, Canadian CPI is likely to decline to 0.4% from 0.6% MoM but the yearly figure may please CAD Bulls with 2.4% mark against 2.2%. Further, the Retail Sales growth is also expected to inflate to 0.4% from 0.3%. Hence, expectedly mixed outcome of consumer-centric details, coupled with recent pullback in Crude & global trade pessimism, may keep hurting the CAD unless there are any strong positives pop-up.

Technical Talk

Having dipped beneath the short-term ascending TL, the NZDUSD is likely declining towards 100-day SMA level of 0.7210 and the 0.7185 supports while 0.7280 & 0.7305 can provide immediate resistances to the pair. Further, the AUDUSD is struggling around 0.7700 round-figure with 0.7665 being a follow-on support whereas 0.7730 & 0.7750 acting as adjacent resistances. At last, the USDCAD needs to surpass 100-day SMA level of 1.2680 in order to aim for 1.2730 and the 50-day SMA level of 1.2775 otherwise chances of its pullback to 200-day SMA level of 1.2620 & 1.2550 can’t be denied.

Have a nice trading-day ……

FxAnil · April 23, 2018, 8:25am

Daily Fundamental Dose: 23 – April – 2018

Hello Traders,

Not only upbeat economics & hawkish comments in Fed’s Beige Book but receding trade-war concerns between the China & US, coupled with North Korea’s readiness to stop testing missiles any more, also helped the US Dollar Index (I.USDX) to mark positive weekly closing. On the other hand, GBP was badly hit as disappointing CPI & Retail Sales gained additional support from the BoE Governor’s comments negating next month’s rate-hike as a done deal in dragging the UK currency down. Further, the EUR also had to bear the burden of downbeat data-points and ECB President’s concern for global economic uncertainty while JPY and Gold failed to confront the stronger USD. Moving on, the AUD, the NZD and the CAD, popularly known as commodity-linked currencies, plunged due to soft economic numbers and upbeat greenback’s negative impact on commodity basket whereas the Crude prices rallied on OPEC members’ optimism and declining US inventories.

While last week proved to be a better one for the USD Bulls, start of present week also pleased the buyers after early-day news signaled US Treasury Secretary Steve Mnuchin’s readiness to meet china and reach an agreement that could tame the present trade-spat with China. As a result, the safe-havens, namely Gold and JPY, continued declining when the US Dollar became market favorite. Moreover, the EUR kept being weak even if the EU & German PMIs printed welcome numbers while the GBP and the commodity-linked currencies couldn’t defeat the greenback’s strength.

After not so strong Japanese PMI & welcome PMI numbers, US Flash Manufacturing PMI & Existing Home Sales are left to entertain the traders during the rest of the day. Herein, the Manufacturing PMI can flash 54.3 mark against 54.0 and may continue fueling the USD higher whereas 5.55M release of Existing Home Sales versus 5.54M earlier could act as supporting fact for the USD optimists.

At the Geo-political front, US-China trade related issues might take a front-seat of market attention if Mr. Mnuchin heads to China but latest tweet from the U.S. President Donald Trump saying that the North Korean nuclear crisis was a long way from being resolved could help the JPY & Gold recover some of their latest losses. Moreover, the energy prices recently got a hit when Mr. Trump said that prices are "artificially very high” and the comments were backed by three-year high US RIG counts, which in-turn could trigger the Crude’s pullback.

To sum up, release of headline PMI figures and presently active Geo-political plays could kick-start the crucial week including ECB & GDP figures with a strong push and may entertain the momentum traders.

Technical Talk

Having breached the 1.2300 support-mark, the EURUSD seems coming down to re-test the 1.2240 and the 100-day SMA level of 1.2200 while an upside break of 1.2300 can again propel the pair towards 1.2335, including 50-day SMA level. Further, the USDJPY needs to conquer the 108.00 mark in order to aim for 108.30 otherwise chances of its dip to 107.50 and the 107.00. At last, the EURNZD might find it hard to extend its week-long up-moves due to overbought RSI & descending TL at 1.7065 now, which in-turn may drag the pair to 1.6990 and then to the 1.6965 but break of 1.7065 might not hesitate flashing 1.7100 and the 1.7140 as quotes.

Have a nice trading-day ……

FxAnil · April 24, 2018, 8:09am

Daily Fundamental Dose: 24 – April – 2018

Hello Traders,

In addition to upbeat US PMIs & Existing Home Sales, readiness to calm the trade disputes down with China and relinquishing sanctions against the Russian aluminum producer propelled the US Dollar Index (I.USDX) at the week-start. While US details rejuvenated speculations concerning more than three rate-hikes from the Fed, sluggish PMIs from EU dialed back bets of the ECB’s monetary tightening and dragged the EUR towards south. The GBP also witnessed downside pressure as recent slew of data-points & BoE Governor’s comments kept smashing expectations of the UK central-bank’s rate-hike during next month. Further, the AUD, NZD and CAD plunged due to dual attacks from rising USD & Chinese President’s comments that the policymakers need to do hard-work in order to meet this year’s economic targets whereas JPY & Gold had to bend down in front of the market optimism for greenback. At last, the Crude prices rallied after news of increased Geo-political tensions between Saudi Arabia & Iran were backed by rumors of US preparing for fresh sanctions on Iran.

During early Tuesday, the U.S. Dollar extended its previous north-run on the back of receding trade-war pessimism & expectations that the Fed will now have additional support to announce increased pace of rate-hikes. On the contrary, negative impacts of Robert Mueller’s investigations were tamed and the positive developments from French President’s on-going visit to US favored the greenback.

At the data front, weaker than expected print of Australian CPI strengthened speculations that the RBA will hold its monetary policy unchanged for longer than initially estimated while softer than expected German IFO Business Climate provided another blow to the EUR.

Moving forward, monthly releases of US CB Consumer Confidence and New Home Sales are remaining economics that investors might be focusing on to determine near-term course of the USD when the currency is already pleasing the buyers.

Additionally, progress on the US-China trade dispute front and the U.S. relations with France & Japan, coupled with Robert Mueller’s investigation on Trump administration, could keep entertaining momentum traders.

Given the latest strength in US economics and receding trade disputes with majority of developed economies, chances of the USD to extend its rise are much brighter; however, disappointing print of scheduled data-points and negative news from Robert Mueller’s on-going investigation could trigger the currency’s pullback.

Technical Talk

GBPUSD’s sustained trading below 1.3950 continue signaling the pair’s drop to 1.3890 and the 1.3845 while 1.3980 can act as follow-on resistance after 1.3950 break. In case of the USDCAD, the pair has to clear the 1.2860 resistance in order to aim for 1.2910 & 1.2945-50 otherwise it can come down to re-test the 1.2800 & 1.2730 supports. Moving on, the GBPJPY continue trading above an upward slanting TL and indicates its recovery towards 152.20 and the 152.70 nearby resistances while 151.30 may offer immediate rest to the pair ahead of reigniting the importance of 150.80 trend-line figure.

Have a nice trading-day ……

FxAnil · April 25, 2018, 7:43am

Daily Fundamental Dose: 25 – April – 2018

Hello Traders,

In spite of registering upbeat Consumer Confidence & New Home Sales, coupled with receding trade-war tensions, the US Dollar couldn’t extend its earlier gains on Tuesday as some of the top-tier industrial and technology companies warned on their profit forecasts. With this, commodity-linked currencies, like AUD, NZD and CAD, registered downside due to expected dip in future commodity demand but the EUR & Gold managed to capitalize the greenback’s decline. Further, the GBP strengthened after EU officials seemed ready to offer better terms to the UK if it stays in custom region post-Brexit while the JPY kept trading southwards as recently weaker data-points indicate fewer chances of the BoJ’s monetary tightening going forward. Additionally, the Crude prices also dropped on weaker demand forecast, higher API stockpile and expectations that US may refrain from levying additional sanctions on the Iran.

While equity market announcements rattled the global investor confidence on Tuesday, early Wednesday provided a good start to the USD buyers as holidays at Australia, New Zealand & Italy shifted traders’ attention to underlying strong fundamentals of the U.S. economy. Also, news that NAFTA trade discussions are going well and Mr. US President praised North Korean leader’s recent behavior offered additional strength to those US Dollar optimists. As a result, the EUR & GBP had to liquidate their recent gains while commodity-linked currencies and JPY extended respective south-runs.

Looking forward, details of US Crude inventory and testimony by the BoC Governor are the only events to watch on the economic calendar. Herein, the Crude stockpile are expected to register higher than earlier drawdown of -1.1M with -1.6M and can rejuvenate the energy Bulls while BoC Governor may show concerns for weaker economic data-points and threats emanating from trade-protectionism, which in-turn could drag the CAD further towards south.

On the other hand, raft of equity market announcements and trade discussions between the US, Canada & Mexico, in addition to the US trade concerns with China, may entertain investors in the absence of major economic details. Moreover, developments on Robert Mueller’s investigation and French President’s US visit could also offer intermediate trade opportunities.

Given the lack of economic data-points and expected improvements in global trade talks, chances of the USD to recover its losses are high but Mr. Trump’s ire over Mueller investigation and Iran may hurt the currency if any harsh comments arrive over his Twitter handle and/or from White House authorities.

Technical Talk

While break of 0.7650 opens the gate for the AUDUSD’s drop to 0.7550 and the 0.7500 and upside clearance of 0.7610 can trigger the pair’s pullback. Further, the NZDUSD may avail 0.7050 as an intermediate halt ahead of testing the 0.7040-35 horizontal-support whereas 0.7120 & 0.7145 can limit the pair’s near-term advances. Furthermore, the AUDNZD’s break of 1.0665-60 resistance-confluence, now being the support, could propel the pair towards the 1.0700, the 1.0745 and the 1.0800, incl. 100-day SMA, while 1.0615 & 1.0555 may become important if 1.0660 is broke.

Have a nice trading-day ……

FxAnil · April 26, 2018, 8:18am

Weekly Fundamental Dose: 26 – April – 2018

Hello Traders,

While upbeat economic details & Beige Book statements rejuvenated Fed’s rate-hike expectations during last-week, receding trade-war concerns between US & China, coupled with North Korea’s readiness to stop nuclear missile testing, offered additional strength to the US Dollar Index (I.USDX) in posting a weekly positive closing. Those USD-positive waves stretched during present week with slew of positive data-points whereas US-China trade dispute seem coming to an end with representatives of both the economies showing eagerness to talk about trade related issues rather than punishing each other. However, some of the biggest events of the week, namely ECB & GDP releases from UK & US, are still left to play their magic and become crucial to observe.

Hence, it would be logical to move towards such fundamentals but discussing latest market news would add benefits to the update.

Market Optimism Reversed USD’s Decline

With the upbeat data-points and reducing political tensions, market attention shifted to Fed’s rate-hike concerns and helped the US Dollar to reverse its previous week declines by posting a positive weekly closing in last-week. The EUR and GBP weren’t so fortunate and had to bear the burden of dovish comments from their respective central-bank leaders while JPY & Gold became the victim of decline in risk-safety demand. Further, AUD, NZD & CAD were hurt from all the sides, be it softer data-points or stronger greenback cutting commodity demand, whereas Crude prices shaved off USD strength’s negative impact and rallied as depleting stockpiles & Geo-political tensions emanating from Middle-East favored energy Bulls.

Extended Good Times For Greenback Buyers

Having registered an upbeat closing at the weekend, the US Dollar got extra boost from early-week economic stats and US-China trade-related news to remain strong so far during the present week. The same adversely affected the EUR due to weaker readings of Flash PMIs while the GBP also dropped on concerns of no rate-lifts during upcoming BoE meeting. Moving on, the AUD had to suffer because of soft Inflation pushing back expectations for RBA’s hawkish turn but the NZD & CAD kept declining on broader commodity sell-off due to stronger USD. Moreover, JPY & Gold still struggle to please the buyers as greenback continue being in demand but the Crude remained volatile as Geo-political concerns at Iran & Venezuela confronted with increase in US inventories.

Traders Observes Central-Banks & GDP

Even if recent positivity in the market so far helped the USD, the greenback gauge seemed in tension at the start of Thursday when ECB meeting and monthly release of US Durable Goods Orders are up for publish. Also, French President, during his three-day US visit, warned that the U.S. may pull out of the Iran nuclear deal and can put additional pressure on the middle-east worries. Furthermore, China recently said they want to discuss trade-issues with U.S. and overcome the trade-war fears after US Treasury Secretary Steven Mnuchin signaled meeting with Chinese authorities to tame latest turmoil.

Other than the ECB, Durable Goods Orders and Geo-political concerns, Friday’s GDP numbers from UK & US, coupled with Japanese Inflation, Unemployment & BoJ meeting, could keep entertaining the investors going forward. It should also be noted that quarterly reading of US Employment Cost Index, up for Friday, may offer surprise if registering extreme outcomes.

Starting with monetary policy meeting of the European Central Bank (ECB), the regional central-bank isn’t expected to alter its present monetary policy but the focus is on President’s press conference after rate-statement. ECB President, Mario Draghi, might be questioned over the recent weakness in EU data-points scaling back the views of monetary policy tightening by this year-end. In case of the U.S. Durable Goods Orders, the monthly growth may soften to 1.6% from 3.0% prior while Core Durable Goods Orders may register 0.5% mark against 1.0% earlier.

Moving on towards Friday, the day starts with Japanese Tokyo Core CPI & Unemployment Rate, both of which are likely to remain unchanged at 0.8% & 2.5% respectively, while monetary policy meeting by the Bank of Japan (BoJ) could gain traders’ attention then after. The BoJ is also expected to follow ECB’s footsteps and is largely forecasted not to change present monetary policy. However, quarterly release of BOJ Outlook Report and press conference by the Governor, Hruhiko Kuroda, will become important to follow. While weakness in economics is a case for the JPY as well, the central-bank needs to brighten its forecast & keep supporting policy tightening to help the Japanese currency recover its latest losses.

Coming to the GDP front, initial estimation of the Q12018 GDP releases from UK & US are less likely to please the buyers are the UK GDP may print 0.3% growth against 0.4% prior while its US counterpart can mark 2.0% increase versus 2.9% earlier. Though, it’s the Employment Cost Index, which is expected to flash 0.7% against 0.6%, that can keep entertaining the USD optimists.

To sum up, in order to maintain EUR traders’ optimism Mr. Draghi has to call the latest economic softness as temporary and reaffirm the central-bank’s readiness to adhere tightening by the year-end while US Employment Cost Index needs to mark strong number to help the greenback maintain its up-moves.

The JPY isn’t more expected to reverse unless either rising Geo-political tensions or strong hawkish message from BoJ erupts. Further, the GBP may well continue on its downturn unless strong GDP whereas commodity-currencies, namely AUD, NZD and CAD, had to stay ready to bear counter-USD moves.

Technical Analysis

Unless breaking the 1.2165-55 horizontal-support on a daily closing basis, chances of the EURUSD’s pullback to 1.2215 & 1.2250 can’t be denied whereas GBPUSD seems all set to test the 100-day SMA level of 1.3865 with 1.4020, including 50-day SMA, likely limiting its near-term upside. Further, the USDJPY has 109.80 & 110.15-25 as strong resistances & 108.90 & 108.40 as adjacent rests while USDCAD can keep targeting 1.2900 & 1.2945 unless breaking 1.2800. Additionally, AUDUSD traders can aim for 0.7540 & 0.7500 if the pair continue trading below 0.7630 but the NZDUSD can bounce off the 0.7040-30 horizontal-region towards 0.7110, failing to which can register 0.6975 as a quote.

Have a nice trading-day ……

FxAnil · May 1, 2018, 9:02am

Daily Fundamental Dose: 01 – May – 2018

Hello Traders,

Other than welcome US economic stats & White House leaders’ efforts to tame trade-disputes with China, the USD got an additional help from the ECB’s dovish remarks that fueled the US Dollar Index (I.USDX) to mark consecutive second weekly positive closing. As a result, the EUR dropped heavily while the GBP also registered a plunge on disappointing data-points scaling back expectations of the BoE’s rate-hike. Commodity currencies, namely AUD, NZD and CAD, couldn’t confront the stronger USD when their own numbers were not up-to the mark whereas the JPY & Gold stretched their respective south-run due to the same reasons. Further, the Crude Oil failed to please buyers with Middle-East tensions as increasing US production & stockpiles threatened global energy-producers’ efforts to curb supply-glut.

While optimism prevailed for the greenback buyers during last-week, present week started with a smile on Bulls’ face after US President pushed further the imposition of steel and aluminum tariffs on Canada, EU and Mexico until June 1 while giving permanent exemptions to Argentina, Australia and Brazil from the same levies. With this, rest of the major currencies had no reasons but to keep declining against the USD but the CAD was least affected as increased tensions at Middle-East propelled the Crude prices, which is Canada’s highest export-item.

On early Tuesday, when the two-day FOMC meet will begin, energy traders got an additional boost after Israeli PM provided proofs of Iran’s nuclear-test intensions to the U.S., which in-turn may push Mr. Trump to scrap 2015 nuclear deal that eased sanctions against Iran in exchange for a halt to nuclear weapons research. Moving on, Reserve Bank of Australia (RBA) was another important event of the day that played it role of dragging the AUD further towards south when the central-bank stepped back from giving hints to its future policy moves on concerns for lower wage-growth. Moreover, the UK Manufacturing PMI became one more downbeat data-point from Britain and dragged the GBP down.

Looking forward, Canadian GDP, US ISM Manufacturing PMI & New Zealand employment details are likely figures that investors will be watching closely when simultaneously observing global Geo-political issues.

Forecasts suggest monthly Canadian GDP to trigger CAD’s pullback with +0.3% growth against -0.1% prior while US ISM Manufacturing PMI can print a bit softer numbers and may activating the greenback’s profit-booking if talks concerning China-US trade relations worsens. In case of the NZD, quarterly job stats seem positive with Employment Change being expected to remain unchanged at 0.5% but the Unemployment Rate likely declining to 4.4% from 4.5%.

Hence, while broader trade related optimism & recently upbeat data-points continue fueling the USD, today’s softer prints shouldn’t be overlooked. Also, NZD & CAD may recover some of their latest losses on welcome numbers and improvement in Crude but GBP & EUR has lesser chances of taking a U-turn.

Technical Talk

Having breached 1.2100 - 1.2090 support-zone, the EURUSD is likely re-testing the 200-day SMA level of 1.2010 while the GBPUSD can avail 1.3655 & 1.3610 unless it trades below 1.3700. At last, the GBPCAD has to close below medium-term ascending TL figure of 1.7650 & 100-day SMA level of 1.7595 in order to revisit the 1.7470-65 area with 1.7730 & 1.7800 acting as immediate resistances to entertain counter-trend traders if the pair reverses from present levels.

Have a nice trading-day ……

FxAnil · May 2, 2018, 7:50am

Daily Fundamental Dose: 02 – May – 2018

Hello Traders,

Even after witnessing nine-month’s lowest print of the U.S. ISM Manufacturing PMI, the US Dollar Index (I.USDX) managed to post a daily positive closing on Tuesday as holidays at EU & Asia, coupled with signs of slowdown elsewhere, continued fueling the greenback when upbeat results from Apple Inc. built investor confidence. The EUR, left with no fresh releases, kept trading southwards whereas the GBP dropped after disappointing Manufacturing PMI added worries for the UK that is already struggling to manage Brexit uncertainty, resignation of one of Prime Minister Theresa May’s key pro-European allies in government and risk of Thursday’s local elections in England.

With the US Dollar’s sustained up-moves to nearly four-month high, the JPY & Gold seemed less warranted by buyers while the Crude also declined on private report showing increased US inventory figures. Further, the AUD had to bear the burden of RBA’s cautious comments while NZD & CAD couldn’t avoid the loss at commodity basket, which in-turn didn’t allow Canadian Dollar to welcome strong GDP number.

During late-Tuesday, the momentum in favor of greenback weakened as news broke that the special counsel, Robert Mueller, might not avoid sending subpoena to the U.S. President in order to push him to testify before a grand jury in case Mr. Trump turns down the request to participate in a voluntary interview. It should also be noted that late-night release of New Zealand employment details pleased the NZD when the Unemployment Rate dropped to fresh nine-year low & Employment Change rose more than forecast.

Moving towards Wednesday, the only day of the week when all the global markets are live, traders remained active at the day-start and aptly responded to late-night details/events from US & New Zealand by dragging the USD down from recent highs & helping the Kiwi to recover some of its latest losses. Market-players were also concerned with today’s FOMC outcome and US delegates arrival to China, in order to discuss trade issues during Thursday & Friday. Additionally, UK Construction PMI, US ADP Non-Farm Employment Change and the weekly Crude stockpile release are also there on cards to please momentum traders.

The UK Construction PMI may deviate from the recent UK disappointment series by flashing 50.5 stat against 47.0 prior while the ADP Non-Farm Employment Change can threaten the USD Bulls with 200K mark versus 241K earlier. Moving on, the Crude oil inventory level is expected to soften a bit to 1.0M from 2.2M and may help the oil prices to maintain strength.

The U.S. Federal Reserve isn’t expected to alter is present monetary policy in today’s meeting but recovery in Inflation and strong jobs market could push policymakers to convey readiness in offering more rate-hikes than initially promised three.

Hence, while data-points & Geo-political events are indicating pullback of the USD, any signs of increased rate-lift pace could negate the negatives and provide greenback gains to the optimists. For the GBP, PMI release had to confront with broader pessimism in order to please the buyers while the energy traders can have some more good-time ahead if US production & inventory don’t disappoint them.

Technical Talk

USDCAD is re-testing the 1.2810-1.2800 support-zone, breaking which it can drop to 1.2760 while the 1.2860 and the 1.2900 can restrict the pair’s near-term upside. Further, the NZDUSD has to conquer the 0.7035 TL resistance if it is to aim for 0.7060 & 0.7100 else it can come down to 0.6990 & 0.6955 rest-points. The EURCAD may bounce back from 1.5375-70 horizontal-area towards 1.5470 & 1.5505 but the pair’s D1 closing dip beneath 1.5370 can fetch it to 1.5320 & 1.5250 supports.

Have a nice trading-day ……