Daily Fundamental Dose

[FxAnil]

Weekly Fundamental Dose: 31 – May – 2018

Hello Traders,

While receding fears of re-election at Italy & absence of fresh split between US & North Korea seems cooling down recent Geo-political pessimism, slew of top-tier stats from EU, US & UK might distract investors from such issues and highlight the importance of economic calendar.

However, it’s better to first understand what’s happened in the market off-late prior to discussing fundamentals for scheduled data-points and some Geo-Political events.

Greenback Benefited From Others Weakness

Irrespective of having many drawbacks, namely sluggish economics, not so upbeat FOMC minutes and Trump’s twitter attacks on North Korea, China & order for probe against auto sector, the US Dollar Index (I.USDX) managed to post a weekly closing as pessimism surrounding EU, UK & some other developed economies helped the greenback to remain in demand. The EUR, on the other hand, had to bear the burden of political problems at Italy & Spain while weaker than expected British CPI dialed back concerns for BoE’s rate-hike dragged the GBP down. Further, AUD & NZD also witnessed profit-booking but CAD couldn’t sustain the dip in Crude prices due to rising US inventories & speculations that global production-cut accord might start rolling back its output restrictions soon. Additionally, increasing Geo-political pressure favored the JPY, Gold and CHF prices due to their safe-haven nature.

Italian Turmoil Rules Market

After turning down the Singapore summit with North Korea during last-week, US President Donald Trump took a U-turn at the start of this week by informing that White House members reached the hermit kingdom in order to prepare for June 12 meet with Kim Jong Un. As a result, global policymakers started taking interest in what could go during the much anticipated gathering where South Korea likely being third party to join the summit. At EU, Italian politics kept ruling the market sentiment where President-elect PM failed to gain populist parties’ favor after the President turned down coalition’s proposal to appoint EU-skeptic leader as their Finance Minister, which in-turn raised the threat of another election. However, Wednesday proved to be a very good-day for the EUR buyers as the regional currency rallied sharply due to receding fears of re-election at Italy that also dragged the US Dollar to register highest daily loss in nearly three-week.

Even if softening pessimism triggered the JPY’s pullback, Gold & CHF remained firm on the greenback’s weakness. At the energy front, concerns that Russia & Saudi Arabia will propose rolling back production-cut accord in their mid-June meeting hurt the Crude prices but the same witnessed short-covering on Wednesday over improvement in market sentiment & decline in USD. Moving on, AUD, NZD and CAD also were trading downward till the market-mood turned in favor of commodity basket on Wednesday.

It’s Economic Calendar’s Turn Now

With the recent change in Italian politics & confirmation that US is going to meet North Korea, investor attention shifted back to economic calendar around early-Thursday when Japanese Industrial Production rose lesser than expected and China’s official Manufacturing PMI surged to eight month high. Given the upbeat Chinese details, the commodity currencies, namely AUD, NZD & CAD extended their latest recovery whereas EUR surged ahead of Flash EU CPI release. The US Dollar maintained its weakness as investors booked profits before Thursday’s Chicago PMI, Pending Home Sales & Friday’s NFP & ISM Manufacturing PMI. Moreover, the GBP is also up for witnessing monthly Manufacturing PMI on Friday, which in-turn helped the UK currency to recover some of its near-term losses.

Having discussed what has happened till now and what are some important data-points to come, it’s time to write about the market consensus for scheduled economics. Amongst them, the EU Flash CPI, the earliest one to publish, may extend the EUR’s up-moves with 1.6% expansion against 1.2% prior while the U.S. Chicago PMI may register 58.2 number against 57.6 but the Pending Home Sales growth isn’t expected to deviate from 0.4% earlier.

Moving on to Friday, monthly readings of US jobs report could fuel market moves one last time before the Fed meets to announce their seventh rate-hike since end of 2015. However, that doesn’t reduce the importance of China’s Caixin Manufacturing PMI & UK Manufacturing PMI to be released early-day. Also, US ISM Manufacturing PMI may entertain traders after the NFP.

The Caixin Manufacturing PMI from China may follow the footsteps of official announcement by rising to 51.3 from 51.1 but the UK Manufacturing PMI could become another drawback for the GBP if matching 53.5 forecast compared to 53.9 prior. Further, the U.S. Average Hourly Earnings could rise by 0.2% from 0.1% prior whereas the Non-Farm Payrolls (NFP) may please the USD hawks by flashing 189K mark versus 164K earlier. Moreover, the Unemployment Rate isn’t expected to change from its 3.9% level whereas the ISM Manufacturing PMI could close the week with positive sign of 58.2 against 57.3 for the USD.

To sum up, improvements in Italy’s political deadlock, coupled with strong EU CPI, could help the EUR to rally further; though, strong US employment details and sturdy US-North Korea relations may keep supporting the greenback unless US-China spoil the mood at last moment before US trade representative will reach Beijing to discuss trade issues.

Additionally, with the upcoming slew of economic details likely diverting investors off from Geo-political pressure, the safe-havens might lose their allure, unless the US Dollar register heavy declines, whereas commodity basket can enjoy China’s upbeat stats & Russia-Saudi Arabia’s wish to roll back global production-cut accord.

Technical Analysis

EURUSD’s inability to sustain the break of 1.1560-50 support-zone signal brighter chances of its pullback to 1.1710, which if surpassed could flash 1.1820 while additional south-run beneath 1.1550 can register 1.1440 & 1.1380 as quotes. The GBPUSD has to clear 1.3180 in order to test the 1.3100 support else it can revisit the 1.3400 & 1.3460 resistances. Further, the USDJPY has 108.00-107.90 as strong support-zone with 109.80 likely limiting the pair’s near-term upside whereas USDCAD can avail 1.2770 & 1.2725 rest-points during its further declines with 1.2920 & 1.2980 acting as adjacent barriers on the upside. At the end, AUDUSD again aims to confront the 50-day SMA level of 0.7610, failing to which can reignite the importance of 0.7410 rest-point while NZDUSD needs to conquer the 0.7030 & 0.7055 to challenge 0.7100 with 0.6950 & 0.6910 acting as nearby supports for the pair.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 01 – June – 2018

Hello Traders,

Not only receding political deadlock at Italy, but Trump’s trade tariffs & upbeat EU CPI also dragged the US Dollar Index (I.USDX) down for second consecutive day on Thursday. With the coalition leaders at Italy managed to propose the ministry with EU-friendly leaders, political crisis at the EU’s third largest economy seemed weighed down and helped the EUR to extend its prior recovery. Adding to that, EU Flash CPI surged to the highest in a year and the Spain is near to avoid its political vacuum after Pedro Sanchez’s socialist party secured enough votes to push away Mariano Rajoy in a confidence vote, scheduled for Friday. As a result, the EUR got an across the board strength while the safe-havens, namely Gold and JPY, dipped due to risk-on.

Other than EUR, the GBP also remained positive in spite of having no important details/events while the CAD & AUD had to bear the burden of trade-war concerns & pessimism at NAFTA. However, the NZD took advantage of the USD’s decline whereas the Crude prices declined even after witnessing higher than expected drawdown in US inventories as concerns for increased US output & dialing back of global production-cut disappointed energy traders.

During early-Friday, market sentiment was largely driven by the U.S. allies’ retaliation to steel & aluminum tariffs on Canada, Mexico & EU and the same is likely offering a tough time to US Treasury Secretary, Steve Mnuchin, at G7 meeting. Being the NFP-day, investors were also concerned about the monthly releases of Employment details for one last-time before Federal Reserve announces its another rate-hike.

While escalation of trade tensions between the U.S., Canada, Mexico & EU, together with speculations for US jobs report, were dominating trade sentiments, BoJ’s cut to bond buying, at a regular auction, for the first time since February went largely unnoticed. Though, softer than expected Caixin Manufacturing PMI from China didn’t refrain to hurt the commodity currencies.

Looking forward, UK Manufacturing PMI seems the first release to watch, which is likely to weaken the GBP with 53.5 mark against 53.9, before traders prepare for the NFP. In case of US employment details, the NFP might please the USD buyers with 189K versus 164K whereas the Average Hourly Earnings could also add strength into the greenback by printing 0.2% growth compared to 0.1% previous. However, the Unemployment Rate isn’t expected to deviate from its lowest levels since 2000, at 3.9%. Moreover, the ISM Manufacturing PMI also signals the USD’s strength with 58.3 consensus against 57.3 earlier.

Hence, with most of the scheduled data-points from US likely to offer rosy picture of world’s largest economy and favor increased pace of Fed rate-hikes, the USD may recover some of its latest losses if the forecasts prove right. Though, political pressure emanating from trade protectionism might act as a hurdle during the greenback’s run. As a result, the JPY & Gold could maintain their up-moves while the EUR & GBP might have to trim their recent gains a bit but the commodities currencies aren’t showing any signs of improvement.

Technical Talk

EURUSD presently struggles around 1.1680 TL resistance, breaking which it can rise to 1.1750 & 1.1800 while 1.1630 & 1.1580 acts as immediate supports for the pair. Further, the USDCHF seems trying to regain its 0.9900 mark, which if broken could help it aim for 0.9930 & 0.9955 resistances; though, downside break of 0.9830 can highlight 50-day SMA level of 0.9800 as a rest to appear. Moving on, NZDJPY failed to surpass the seven-week old descending trend-line, at 76.65 now, and may revisit the 76.00 & 75.80 supports but an upside clearance of 76.65 can quickly flash 77.00 & 77.30 as quotes.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 04 – June – 2018

Hello Traders,

Even if receding political tensions at EU and trade-war threats emanating from US did hurt the US Dollar Index (I.USDX) badly during middle of last-week, Friday’s strong employment numbers shifted market attention to the Fed’s rate-hike and helped the greenback gauge to recover majority of its weekly losses. On the other hand, the EUR also had to mark negative closing in spite of political optimism at Italy & Spain, not to forget the upbeat CPI, as ECB is still considered to be a dove as far as monetary policy tightening is concerned. Further, the GBP benefited from welcome Manufacturing PMI & positive developments at Brexit whereas JPY gained risk-averse traders’ support due to looming trade-war between the U.S. and rest of developed economies. Moving on, AUD, NZD & CAD also flashed green signs after USD’s decline & welcome figures from China pleased commodity traders; however, increasing US Crude output & chances of the OPEC-led group’s production rise dragged the energy prices southwards.

While US jobs numbers and cut in political deadlock at Italy & Spain triggered risk-on at the end of last-week, those sentiments couldn’t last long after Mr. Trump announced that tariffs on Steel & Aluminum will go live on EU, China, Canada & Mexico. With this, the U.S. Treasury Secretary, Steve Mnuchin, found it hard to confront G7 leaders and the US-China trade talks remained dismal without any major progress. Not only this, China has threatened to revoke all the trade related pledges taken recently if US goes ahead with its protectionism.

With the recent ire against US trade protectionism regaining investor’s eye-share, the US Dollar had to start this week on a negative tone when China is actively connecting with major economies to tame the latest tariffs. As a result, the EUR & GBP managed to portray its strength whereas commodity-linked currencies, namely AUD, NZD & CAD, rallied on the greenback’s weakness & upbeat data-points from the Australia.

For rest of the day, UK Construction PMI, EU PPI & US Factory Orders are likely to entertain market players in addition to on-going political drama over the US protectionism. Forecasts suggest 52.0 mark of UK Construction PMI & 0.2% EU PPI against 52.5 & 0.1% respective priors whereas US Factory Orders are likely to print -0.4% number compared to +1.6% earlier growth.

Given the negative consensus for upcoming US details and on-going moves against the US trade policies, USD’s short-term weakness can’t be ruled out, which in-turn could help EUR & GBP to maintain their strength should their respective economics also support the currencies.

Technical Talk

GBPUSD’s break of nearby descending trend-line signals the pair’s up-moves to 1.3410 & 1.3455 but pullbacks beneath 1.3340 may reprint 1.3300 as a quote. Further, NZDUSD again aims for the 0.7030-35 resistance-region, conquering which it can rise to 0.7055 & 0.7100 while 0.6955 & 0.6930 could act as adjacent rests for the pair during its U-turn. Moving on, AUDCAD may find it hard to extend its latest recovery towards 0.9930 & 1.0000-1.0010 unless successfully clearing the 0.9855-60 resistance-confluence whereas 0.9780 & 0.9745-40 can confine the pair’s short-term declines.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 05 – June – 2018

Hello Traders,

With welcome US employment report & receding political tensions at Italy pushing investors towards equity markets on Monday, upbeat performance by tech-shares & AU’s strong local Company Operating Profits & Retail Sales helped market players to concentrate less on trade-war threats. As a result, currencies couldn’t attract more eye-share and safe-havens like JPY & Gold declined whereas US Dollar also trimmed some of its Friday gains after Factory Order plunged. With the USD’s dip offering additional strength to the EUR, the regional currency could well justify optimism at Italy by posting gain on a daily basis. However, the GBP failed to enjoy the greenback’s weakness in spite of better than forecast Construction PMI as fresh Brexit concerns & upcoming G7 triggered the Pound’s pullback. Further, the AUD, NZD & CAD managed to please the buyers as broader optimism portrayed brighter outlook for future commodity demand. In case of the Crude oil, the energy vehicle kept trading southwards on speculations of increasing supply to hurt the latest price recovery.

During early-Tuesday, traders again focused on the background concerns about trade-problems with the U.S. and rest of the world after some G7 members spotted saying that this week’s summit will be 6 plus 1 other. Also, White House official conveyed developments for President Donald Trump’s Singapore summit with Kim Jong Un by revealing that highest pressure will be used unless North Korea agrees for complete denuclearization. Additionally, news that OPEC & non-OPEC producers felt the need for continued cooperation to balance global supply played its role in activating the Crude pullback.

At the economic front, Reserve Bank of Australia (RBA) refrained from altering its present monetary policy by citing weaker inflation going forward. The central-bank also communicated its readiness to hold the policy intact unless reaching inflation & unemployment target, which in-turn are likely far. As a result, the AUD lost major part of its yesterday’s strength.

Moving on, UK Services PMI, crucial to British GDP, will soon fuel the GBP moves while US ISM Non-Manufacturing PMI & JOLTS Job Openings could take the command afterwards. Consensus suggest 52.9 mark against 52.8 for UK Services PMI & 57.9 figure for US ISM Non-Manufacturing PMI versus 56.8 earlier. Further, the JOLTS Job Openings may mark 6.49M number compared to 6.55M prior.

Hence, fresh updates about trade-war & US-North Korea developments have again shifted market focus to risk-off, which in-turn can help JPY & Gold recover their losses; however, expected strength in US & UK economics might not hesitate supporting the USD & GBP respectively.

Technical Talk

Failure to successfully clear the 1.1725-30 resistance-region might again drag the EURUSD towards 1.1630 and the 1.1600 whereas an upside break of 1.1730 can flash 1.1760 & 1.1800 on the chart. Moving on, AUDUSD has to surpass the 0.7655-60 area in order to aim for 0.7715 otherwise chances of its pullback to 0.7600 & 0.7565 can’t be denied. At the end, NZDCHF’s up-moves are being challenged by the 0.6955-65 resistance-confluence, comprising 50-day SMA & seven-week long descending TL, breaking which it can rise to 0.7000 & 0.7020 but inability to conquer the same could reprint 0.6920 & 0.6880 as quotes.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 06 – June – 2018

Hello Traders,

While upbeat performance by the U.S. economics & tech-sector strengthened investors’ support for global equity markets, currencies couldn’t maintain their hot-spots on Tuesday. However, strong UK Services PMI helped the GBP to extend its recent recovery while EUR witnessed mixed results of newly appointed Italian Chief’s comments showing readiness to remain in EU & introduce drastic steps to help the country. Moreover, news that ECB is near to announce end of its monetary stimulus added worries for the regional currency’s traders. Moving on, the US Dollar remained a bit sluggish ahead of the important G7 summit where US President, Donald Trump, may find it hard to confront other 6 major industrial nations when they reveal their anger against trade-barriers. Though, White House announcement that Mr. Trump is now willing to have separate trade-talks with Canada & Mexico rather than stretching NAFTA dragged the CAD & Mexican Peso towards south. With all these ups & downs, the JPY couldn’t avoid BoJ’s preference for loose monetary policy whereas Gold and NZD benefited from the USD’s weakness. Additionally, AUD portrayed the RBA’s softer tone with a decline while Crude prices rose after API showed higher than expected contraction into the inventory levels ahead of today’s official release.

During early Wednesday, global trade optimists got bit of good news when China signaled its preparedness to increase US imports by $25 billion in return of the later’s help to ZTE whereas US Treasury Secretary seemed asking for Canada’s exemption from Steel & Aluminum tariffs. Also, one news report said that US asked Saudi Arabia & OPEC to increase their Oil outputs challenged the Crude’s pullback but couldn’t last-long as yesterday’s dip in API inventories was much stronger hint for the energy traders to maintain their optimism. At the economic front, Australian GDP surpassed consensus & prior.

With the aforementioned early-day triggers, the US Dollar remained a tad lower against majority of its counterparts, except JPY, whereas commodity-currencies, like AUD, NZD & CAD, marked gains. Furthermore, the EUR & GBP also pleased the buyers as lack of any big news highlighted recent positive news for both the currencies.

Looking forward, the economic calendar has fewer details/events scheduled for the rest of the day to entertain momentum traders. Amongst them, Trade Balance numbers from US & Canada & official release of US inventory levels seem important to watch. While US trade deficit is likely to be widened by -50.0B against -49.0B, the Canadian Trade Balance could add strength into the CAD by posting -3.4B mark compared to -4.1B prior. Furthermore, US Crude inventories may challenge the oil’s recent U-turn if matching -2.0M forecast versus -3.6M earlier.

As the G7 is two-days far and developments concerning US-North Korea summit are going smooth, lack of economics may challenge the Forex market volatility and can continue highlighting the equity-front for investors.

Technical Talk

With the 200-day SMA again questioning the USDJPY’s strength, chances of the pair’s U-turn to 109.45 and the 109.00 are higher; though, an upside break of 110.20 could quickly fuel the quote towards 110.60 & 111.00. On the contrary, the USDCHF may re-test 50-day SMA level of 0.9820, breaking which 0.9800 & 0.9765 can come-back on the chart. It should also be noted that 0.9900 & 0.9960 act as important resistances for the pair. Further, the EURCAD has to surpass the 1.5215-20 resistance-region on a daily closing basis in order to aim for 1.5300 & 1.5365-75 else it can drop to 1.5140 & 1.5070 rest-points.

Have a nice trading-day ……

[FxAnil]

Weekly Fundamental Dose: 07 – June – 2018

Hello Traders,

Although Friday’s US NFP helped the greenback to avoid a plunge by last week, improvements in global fundamentals, tech-shares’ rally and ire over US trade protectionism seem playing their roles in dragging the US Dollar down so far during the present week. As a result, the upcoming G7 summit at Quebec will become the hot topic as major industrial nations have already signaled this gathering to be a six plus one other kind due to Donald Trump’s trade tariffs. In addition to the G7 summit, Canadian Employment report and Chinese Inflation numbers will also become crucial to observe for rest of the week.

Having said what could gain market attention going forward, it’s better to check the background and fundamentals concerning the same.

NFP Became A Savior For The US Dollar

While receding political tensions at Italy & Spain, coupled with Donald Trump’s pressure on Steel & Aluminum tariffs hurt the US Dollar till late last-week, Friday’s strong employment report helped the greenback gauge (I.USDX) to recover some of its losses and closed near to the week opening. On the other hand, the EUR was very volatile due to political drama at Italy & Spain, which ended positively, and upbeat CPI but failed to register weekly gains as ECB’s recent dovish stand kept being a big negative for the regional currency. Further, JPY benefited from rising Geo-political tensions but the Gold couldn’t withstand strong US fundamentals whereas GBP stopped its south-run on welcome economics. Moving on, the AUD, NZD & CAD took advantage of the USD’s decline helping commodity basket & positive Chinese stats whereas Crude marked second weekly loss on growing concerns for rising US output and dialing back output-cut accord between OPEC & non-OPEC Oil producers.

The Tale of Trade Protectionism & Equity Rally

With the political problems at EU finally settling down after a long time, investors concentrated more on the economic improvement at global leaders, which in-turn triggered an equity rally and made currencies a bit despicable. However, that didn’t reduce the importance of US trade protectionism that gained major industrial nations’ anger. Due to this, the US Dollar has been on a negative side since the start of the week even after registering positive prints of second-tier economics.

When USD was bearing the fruit of Mr. Trump’s “America First” agenda, the EUR registered noticeable upside when a top-tier ECB member said that the central-bank will very soon announce end of its monetary easing. Moving on, the GBP also gained on strong Services PMI but the JPY lagged on not so welcome stats. Furthermore, the Gold managed to remain strong ahead of the likely tension-filled G7 while AUD and NZD marked green signs on welcome data-points and weaker US Dollar. Moreover, the CAD also remained positive but couldn’t rise as much as NZD & AUD because of the Crude’s decline based on surprise increase in US inventory.

All Eyes on G7

As its only a day away from the much anticipated two-day gathering of global industrial leaders, the G7 summit, investors are all examining chances of what could go wrong and how Forex market can portray those updates when ex-US members are likely to show their anger over the trade protectionism.

Not only market-players, global political leaders are also actively taking interest in the subject as they wished to see how Mr. Trump could confront his allies when nobody is happy with US trade tariffs.

To give some background of the situation, US President Donald Trump levied Steel & Aluminum tariffs on Canada, Mexico & EU during last-week after giving them some time off the same levies from initial announcement. With this, leaders of EU, Canada & Mexico have shown their readiness to retaliate against such measures and discuss the same when they meet Mr. Trump in G7. Some of them, namely Canadian PM Justin Trudeau and French President Emmanuel Macron have become harsh opponents of US policies and grabbed headlines so far during the present week.

China, which isn’t a member of G7, has also shown its anger over the US protectionism and warned to cancel all the trade promises made so far if the world’s largest economy continue marching on its trade tariffs. Moving on, Japanese President is meeting with US counterpart on Thursday to seek permanent exemption from US tariffs & get the hint of what Mr. Trump propose to discuss when he meets North Korean leader Kim Jong Un in Singapore during next week.

Latest developments from the trade front says US President is ready have one-to-one meet with his Canadian & French counterpart to discuss the trade issues but refrained to put the gun down. On the other hand, China is ready to import more than $25 billion of US goods to tame the present trade-tensions between the world’s two largest economies in return of favor to the ZTE.

All in all, global political leaders, mainly from the Canada, EU & France, are likely to show their resentment with US when they meet during Friday & Saturday while China is also trying to tame the Trump’s “America First” agenda.

Other than G7, Chinese Trade Balance and monthly employment report from Canada, up for Friday, followed by Saturday’s Inflation numbers from China, are likely being important to watch. It should also be noted that developments concerning Trump-Kim summit at Singapore are going smooth and catches less observers.

Among them, China’s Trade Balance could please commodity buyers with 238B surplus figure against 183B prior. Canada’s Employment Report become even more important this time as BoC has recently been hawkish and a strong number could signal another rate-hike from the Canadian central-bank. Forecast suggest, a +19.1K mark for Employment Change against -1.1K earlier while Unemployment Rate isn’t likely to alter from 5.8%. In case of China’s Inflation numbers, the CPI isn’t expected to change from 1.8% on a yearly basis whereas the PPI might please the Bulls with +3.9% mark against +3.4% previous print.

To sum up, G7 will undoubtedly be at center of market attention for rest of the week wherein US President Donald Trump’s ability to please his close allies will be tested. In case Mr. Trump fails to gain confidence of the rest G7 members, USD might have to decline further, which in-turn could be positive for JPY, EUR & commodity currencies. Moreover, welcome economics from Canada & China can infuse additional strength into the AUD, NZD & CAD.

Technical Analysis

EURUSD again aims for the 1.1845-50 resistance-region, breaking which 1.1940 and 1.2010-15 could appear in the Bulls’ radars to target while the 1.1720, the 1.1660 and the 1.1570 can offer nearby rests to the pair during its U-turn. Further, the GBPUSD has to clear the 1.3480 barrier to visit the 200-day SMA level of 1.3585 else it can come down to re-test 1.3300 & 1.3230 while USDJPY is finding it hard to conquer 200-day SMA level of 110.20, which can fuel it to 110.80 & 111.40, and may dip to 109.30 & 108.75 if the weakness persists. Moving on, AUDUSD aims for 0.7680 & 0.7730 with 0.7600 & 0.7560 being immediate supports whereas NZDUSD has 0.7090 & 0.7125 as resistances to watch unless it trades beyond 0.6980 support. At the end, USDCAD has 1.3100 & 1.2850 as important levels with either side breaks indicating 1.3180 & 1.2800 to appear on the chart.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 08 – June – 2018

Hello Traders,

Thursday proved to be a volatile day for global forex traders as not only economics but Geo-political catalysts also played their role in fueling market moves. Starting with the EUR & USD, the US currency initially enjoyed sluggish EU stats and upbeat Jobless claims favoring increased pace of rate-hikes from the Fed but later on declined when speculations concerning the ECB’s intention to announce end of its massive monetary stimulus dragged the US Dollar Index (I.USDX) down at the day-end, which in-turn helped the EUR to remain strong for one more day. Adding to that, leaders of major industrial nations, mainly from G7, kept spreading the word of their plans to make US realize that its trade-tariffs aren’t acceptable to them and the same offered further weakness to the greenback. Moving on, the GBP also strengthened against the US Dollar, irrespective of Brexit uncertainty, as UK Halifax HPI flashed strong growth while JPY & Gold benefited from the present Geo-political tensions mainly emanating from Middle-East or G7 nations and/or China. Moreover, the AUD, NZD & CAD declined on worries over future trade restrictions hurting commodity demand whereas Crude prices rose on supply shortage at Venezuela & disagreements between global oil producers over dialing back of output-cut.

On Friday, investors remained cautious since the start as two-day summit of G7 nations will convene in Quebec and same could endanger the very existence of a body if US President blasts on pressure mounted on him by other six economies. Also, the early-day release of weaker than expected print of Chinese Trade Balance & second estimate of Q1 2018 Japanese GDP affected the commodity currencies and JPY. However, the JPY was broadly stronger as Risk-on sentiment returned to market ahead of crucial events, including G7, Canadian Employment Report & Chinese Inflation releases.

Talking about the economic calendar, Canada’s Employment Report become even more important this time as BoC has recently been hawkish and a strong number could signal another rate-hike from the Canadian central-bank. Forecast suggest, a +19.1K mark for Employment Change against -1.1K earlier while Unemployment Rate isn’t likely to alter from 5.8%. Furthermore, Saturday’s Chinese Inflation numbers indicate that the CPI may remain unchanged at 1.8% on a yearly basis whereas the PPI might please the Bulls with +3.9% mark against +3.4% previous print.

Turning to the G7, Canadian & French leaders have already sound too strong to tame Mr. Trump’s “America First” agenda whereas EU may put forward its wish to regain US on environment treaty. Moreover, the Germany is also supporting the Canada & French to retaliate US trade-tariffs but the UK shows a measured response.

Hence, while economics are crucial for commodity currencies and indicate optimism going forward, G7 talks will be crucial and any surprise negative developments could fuel the safe-havens and may hurt the USD.

Technical Talk

USDCAD again heads to 1.3045-50 resistance-region, breaking which it can rise to 1.3120 whereas 1.2960 & 1.2900 offers immediate supports to the pair. Further, NZDUSD’s pullback from 0.7055 may recall the 0.7000 and the 0.6980 supports while an upside break of 0.7055 may highlight 0.7100. At the end, EURAUD has to surpass 1.5585 TL resistance in order to aim for 1.5660 & 1.5725 otherwise it’s pullback to the 1.5470 and the 1.5440 can’t be negated.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 11 – June – 2018

Hello Traders,

Absence of major economic boost and speculations of tough G7 summit for the U.S., which actually resulted the much anticipated views correct, portrayed second consecutive weekly decline by the US Dollar Index (I.USDX) as investors perceived Trump’s trade protectionism to be negative for the world’s largest economy. On the other hand, comments favoring ECB’s nearness to end massive bond-buying program by senior ECB member propelled the EUR whereas GBP remained mostly volatile due to Brexit worries but ended the week on a positive side because of the USD’s decline. Further, the AUD, NZD and CAD also took advantage of the greenback’s decline but the JPY failed to remain strong on softer than expected Japanese data-points. Moving on, the Gold prices benefited from the risk-off sentiment ahead of G7 while Crude Oil dropped again as increase in US stockpile and concerns for rolling back global production-cut disappointed energy traders.

During early-Monday, investors showed their disagreement with US President Donald Trump’s recent behavior after G7 wherein he initially agreed to the joint communiqué but disavowed the same after few hours by lashing out at Canadian PM Justin Trudeau. Adding the downside pressure on USD was the news that Special Counsel Robert Mueller’s investigation of Russian interference in the 2016 U.S. presidential election as the investigator released indictments against Trump’s former campaign chairman, Paul Manafort.

With the USD’s decline, the EUR was very much in a positive mood ahead of its much awaited ECB meeting on Thursday but the JPY & Gold had to dip as Mr. US President, when reaching Singapore for a summit with North Korean leader, brushed some tension off the meet by being optimistic. It should also be noted that Canadian Dollar witnessed initial blow from traders as Trump’s tweeter attacks on Trudeau and decline in Crude prices acted as negatives for the Loonie but it later on recovered the loses after global leaders showed their support to Canadian PM. Moreover, Crude prices extended their south-run after fresh report suggested further increase in US rig counts and Russian exports.

Hence, while G7 ended with a sour note and investors have already reacted to the same, market attention might now turn towards economic calendar and the upcoming Singapore summit.

At the economic calendar, UK details like Manufacturing Production, Industrial Production & Goods Trade Balance are scheduled to make investors busy. Forecasts suggest, UK Manufacturing Production to report +0.3% growth against -0.1% prior contraction while Goods Trade Balance likely revealing dip in earlier trade deficit of -12.3B with -11.5B figure. Additionally, the Industrial Production growth isn’t expected to alter from its 0.1% mark.

At the political front, analysts may spend their day forecasting on what Trump could offer and Kim might accept at the historic meet between two leaders. Mr. Trump has already made it clear that he wish to have complete denuclearization from Kim Jong Un but the later has mostly been silent about his demands. However, it is much anticipated that the North Korean leader may want to get US sanctions off from the hermit kingdom and the US forces off the South Korea & Japan in order to please Mr. Trump.

To sum up, mostly upbeat data-points from the UK might help GBP to extend its latest recovery but tensions surrounding Brexit can keep Pound gains under check. In case of the USD, the greenback might have to suffer a bit more due to Trump’s latest behavior at G7 and uncertainty for the Singapore summit which in-turn could help the safe-havens & commodity currencies.

Technical Talk

GBPUSD again aims to confront the 1.3500 resistance-mark, breaking which it can rise to 1.3560 while failure to clear the same might drag the Cable towards 1.3350 & 1.3300 re-test. Further, the USDJPY has 110.30 & 110.60 as immediate barriers before it can target the 111.00 round-figure whereas 109.30 & 109.00 could serve as nearby supports during the pair’s pullback. Moving on, the EURJPY also struggles with 130.00 TL resistance in order to challenge the 130.30 & 130.60 resistances while 128.50 & 127.70 can offer immediate rests for the pair in case it again fall short of strength to clear the TL mark.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 12 – June – 2018

Hello Traders,

Having received initial negative response to Mr. Trump’s reaction after G7, the US Dollar Index (I.USDX) recovered some of its last-week’s losses on Monday as optimism surrounding the US-North Korea summit in Singapore favored the greenback. However, that couldn’t hurt the EUR as rising speculations for ECB’s hawkish outcome met with praise for Italy when the nation appointed Pro-EU member as one of its top policymakers. On the other hand, the GBP dropped after UK Manufacturing Production registered disappointing figure whereas JPY also weakened due to positive developments at Singapore & weaker Japanese data-points but the Gold remained in green region as actual outcome of Trump-Kim summit was still pending and raised uncertainty. Further, the AUD, NZD & CAD posted profits due weekend’s upbeat Inflation details from China while Crude prices also increased as cracks in a Nigerian oil pipeline threatened energy supply.

During early-Tuesday, global investors were all eyed on news emerging from Singapore where the U.S. President Donald Trump & North Korean leader Kim Jong Un were acting cordially at initial discussions. By lunch-time at the host, Trump has already communicated that they have made “a lot of progress,”. Post-lunch, both the policymakers signed a secret documents and praised each other, which in-turn served as a sign of the successful summit. At the end, Mr. Trump communicated that North Korea has agreed to complete denuclearization and detailed discussions will be held by their ministers afterwards. However, the actual result of the summit is yet to be announced as what made North Korea surrender its Nuclear arsenal is still unknown.

As and when the Trump-Kim summit started flashing positive results, the US Dollar extended its recent recovery but later on dipped due to speculations that unclear outcome of the summit might have some negative surprises for the globe, which in-turn hurt the USD.

Other than Trump-Kim summit, UK politics will also be in highlight as Theresa May’s Brexit Plan B for Ireland will be up for voting in parliament. On the data side, UK Jobs report, EU ZEW numbers and US CPI will be highly important to watch.

While decline in UK Average Earnings to 2.5% from 2.6% could be compensated by the dip in Claimant Count Change, to 11.3K from 31.2K, any change in Unemployment Rate from 4.2% could determine near-term GBP moves. For the EUR, ZEW Economic Sentiment figures might disappoint the EUR traders with 0.1 mark against 2.4 prior while its German counterpart could confirm the pessimism with -14.6 figure versus -8.2 earlier. Moving on to US CPI, the headline inflation gauge is likely to remain unchanged at 0.2% and the Core CPI is also expected to maintain its 0.1% stand while looking at the monthly reading. However, the yearly figures are bearing quite strong consensus with CPI indicating 2.8% growth against 2.5% prior and the Core CPI signaling 2.2% mark versus 2.1% earlier.

Given the uncertainty over the Singapore summit still confusing market players, decline in US CPI could become damaging for the greenback; however, expected declines in EUR & GBP might compensate for the US Dollar in that case. Hence, greenback is most likely to extend its recovery unless any extreme disappoint pops-out.

Technical Talk

EURUSD is struggling with 1.1805 TL resistance, breaking which it can rise to 1.1840 & 1.1900 whereas 1.1760 & 1.1730 could offer immediate supports to the pair. Further, AUDUSD has to clear the 0.7630 barrier in order to meet the 0.7660 otherwise chances of its pullback to 0.7600 & 0.7570 can’t be denied. At the end, short-term ascending triangle favors the EURCHF’s rise to 1.1655-60 and the 1.1720 but a downside break of 1.1555 support can reprint 1.1500 on the chart.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 13 – June – 2018

Hello Traders,

Not only US President Donald Trump’s achievement to get complete denuclearization from North Korea, but upbeat CPI numbers also helped the US Dollar Index (I.USDX) to post a positive daily closing on Tuesday. With this, diminishing Geo-political risks dragged the JPY & Gold towards south whereas disappointing ZEW Economic Sentiment numbers did hurt the Euro. Further, the GBP managed to rise against majority of its counterparts, except the USD, after Theresa May managed to get parliamentary support for her Brexit plan with few alteration and a final right to give ‘meaningful vote’ to members of parliament. Moving on, the AUD, NZD and CAD couldn’t confront the stronger USD whereas Crude prices declined due to surprise rise in industry report concerning stockpile and Russia’s readiness to propose increase in oil production at pre-October 2016 levels at next week’s meeting of global oil producers.

While Singapore summit is out of way, investor focus shifted back to central-banks during early Wednesday wherein the today’s FOMC and tomorrow’s ECB gain higher attention. Given the nearness to the Fed’s meet, coupled with optimism surrounding US economy backed by welcome data-points and recent Trump-Kim summit, the US Dollar managed to extend its recovery. As a result, the safe-havens, like JPY & Gold, declined further while EUR & GBP traded nervous ahead of important releases/events. Additionally, comments from RBA Governor that traders shouldn’t worry about housing market but weak wage growth & inflation continue requiring lose monetary policy for the foreseeable future fetched the AUD to south. In case of the Crude prices, speculations for increased supply kept disappointing the energy Bulls, which offered additional weakness to the CAD, but the NZD witnessed pullback.

Looking forward, UK CPI, US PPI and weekly US Crude Oil inventory releases are likely intermediate data-points that can entertain market-players ahead of the FOMC. Amongst them, UK CPI is likely to remain unchanged at 2.4% whereas US PPI may increase to 0.3% from 0.1%. Moreover, the Crude stockpile details may deviate from industry report and flash -1.4M mark against +2.1M earlier.

In case of the FOMC, a 0.25% rate-hike is almost given but what investors will be concentrating more is the central bank’s “dot plot” as a guide to future interest rates and Fed Chair Jerome Powell’s press conference.

During its March release, the dot-plot showed that policymakers are evenly split to project three hikes this year and hence any shift of the FOMC member to higher number, considering improvement in inflation & wage growth, could highlight the four-lifts a year issue. However, Mr. Powell has always been against the dot-plot being actual barometer of the bank’s future rate-hikes and hence his speech should also be closely observed to see if he favors increased pace of rate-alterations or not. Not only the rate-projection, quarterly economic forecast & press conference by the Fed Chair will also entertain the momentum traders. During its March meeting, the Fed raised its predictions for the near-term GDP and Inflation figures while cutting down the Unemployment rate for both near-term and long-term.

Hence, there are many ups & downs that together contribute towards making today’s FOMC as decision-day for the Federal Reserve and for the market-players as well. In case the Federal Reserve maintains its hawkish mood and/or favors four rate-hikes a year plan, the USD can rally but any disappointment from the central-bank can have higher repercussions. For the GBP, today’s CPI could help extend its recent recovery only if the gauge manages to surpass the present level otherwise chances of dovish BoE could hurt the UK currency.

Technical Talk

NZDUSD is struggling in a range of 0.6995 to 0.7055 with either-side break indicating 0.7095 & 0.6960 to come-back on the chart while USDCHF’s recent break of short-term descending trend-channel indicating its rise to 0.9900 & 0.9935 with 0.9825 & 0.9790 being nearby supports to watch. For the CADJPY traders, short-term symmetrical triangle resistance could limit the pair’s up-moves around 85.05 and may trigger its pullback to 84.60 & 84.30 but break of 85.05 can flash 85.40 as a quote.

Have a nice trading-day ……

[FxAnil]

Weekly Fundamental Dose: 14 – June – 2018

Hello Traders,

While Wednesday’s Fed rate-hike and upgraded dot-plot couldn’t favor the US Dollar Index (I.USDX) by repeating the recent history of a dip in greenback on the day of rate-hike, global investors now shift their attention to the ECB. The reason being latest comments from top policymaker that the central-bank will discuss end of its massive QE at this meeting. In addition to the ECB, US Retail Sales, monetary policy meeting by the BoJ, EU Final CPI & few second-tier stats from the U.S. could entertain momentum traders.

Before we discuss fundamentals concerning aforementioned details/events, it’s better to look at what has happened in the markets off-late.

Political Pessimism Again Dragged The USD Down

Not only war of words between the U.S. & rest of G7 members but the Robert Mueller’s investigation of Russian meddling in 2016 Presidential election also proved to be major negatives for the US Dollar Index (I.USDX) during last week when there were very few data-points scheduled from the world’s largest economy. When USD was declining, the EUR got a good news from ECB’s Chief economist that the central-bank could discuss winding its massive bond-purchases. Further, the GBP portrayed upbeat PMIs & positive developments at Brexit but the JPY had to bear the burden of sluggish GDP whereas Gold prices benefited from risk-off. Moving on, the AUD, NZD & CAD also registered profits due to USD’s decline and speculations that unity of six G7 members could push Mr. Trump to soften his trade protectionism. However, the Crude prices remained negative on concerns of Russia & Saudi Arabia may propose rolling back their production-cut targets and hike in US inventories & rig counts.

Plus For Singapore, Minus After FOMC

Having witnessed negative weekly closing, the US Dollar remained very volatile since the start of this week. The earlier moves were mostly positive due to optimism surrounding Trump-Kim summit in Singapore, which actually resulted success, but the Fed’s rate-hike and upgraded dot-plot, together with Fed Chair’s hawkish statements, failed to please greenback buyers as those moves seemed mostly priced-in.

On the other hand, the EUR shrugged off disappointing ZEW numbers with optimism ahead of the ECB meeting while the GBP also neglected downbeat employment & inflation figures due to Theresa May’s ability to win parliamentary approval for her Brexit plan. Moving forward, the JPY kept being weaker as success of Singapore summit and soft economics dragged the Japanese currency down but the Gold continued rising on weaker USD. Furthermore, AUD weakened on sluggish stats but the NZD & CAD maintained their strength on improvements at commodity basket. Moreover, the Crude prices also rose when surprise dip in US crude inventory joined hands with supply-cut at Nigeria & Venezuela.

All Eyes Are On The ECB

During early Thursday, the day when European Central-Bank is scheduled for its meeting, investors remained optimistic for the EUR while slew of disappointing stats from China & Australian dragged the AUD further towards south. Further, the USD carried its loss forward while JPY & Gold took advantage of the same. It should also be noted that NZD & CAD remained unaffected of the Chinese & AU outcomes whereas the GBP sound positive before the UK Retail Sales.

As it’s the ECB day, let’s first start with what could happen around the monetary policy meeting by the European Central Bank. Even if the central-bank isn’t expected to alter its present monetary policy, speculations that Mario Draghi & Co. could deliver hints for the QE rollback is a big positive for the regional currency. However, the economic calendar is on the other side and have been flashing weaker stats off-late, except CPI, which may push some of the policymakers to wait before discussing the QE rollback. Additionally, Italy is still a problem for the central-bank as the ruling coalition has high spending plans and may create a barrier for the MPC members when being hawkish. Hence, ECB President’s press conference after the meeting would be highly observed in order to get the hints of QE reversal and may direct near-term EUR moves.

Before the ECB, the UK Retail Sales could gain market attention wherein forecast suggest a 0.5% growth against 1.6% prior hike. After that, US Retail Sales could entertain the USD buyers with +0.4% increase versus +0.3% earlier.

While aforementioned details/events are likely to please momentum traders on Thursday, Friday starts with monetary policy meeting by the Bank of Japan (BoJ). The Japanese central-bank isn’t expected to alter its monetary policy but may show its concern for the softer data-points and recently announced cut in bond-purchases, which in-turn could be important for the JPY traders. Moving on, the EU Final CPI may maintain its 1.9% stand intact while the U.S. Empire State Manufacturing Index could add weakness into the greenback if matching 19.1 consensus compared to 20.1 earlier. Though, expected improvement in US Prelim UoM Consumer Sentiment, to 98.5 from 98.0, may help the USD to remain less affected.

At the political front, US-China trade pessimism is again on the forefront after US policymakers have shown their intention to discuss the items for $50 billion worth of taxes on Chinese products that can be in practice as early as next month. In retaliation, China has also shown its readiness to dump all previous promises and announce tariffs on the U.S. goods. Additionally, Robert Mueller’s investigation is also getting heat and may grab some more of the Trump administration members, either present or past, to make Mr. Donald Trump found guilty of taking Russian help in order to become US President.

To sum up, FOMC’s inability to please the Bulls shows market’s favor for the ECB and an upbeat outcome could fuel the EUR further towards north while hurting the USD at the same time. However, welcome prints of second-tier US releases and receding political tensions, be it from China or Robert Mueller’s investigation, could confine the greenback’s drop. It should also be noted that JPY & Gold can take benefit of the same and may mark another positive weekly close unless BoJ refrains to please the buyers.

In case of the GBP, Theresa May’s success at parliament may keep helping the GBP unless receiving extremely disappointing data-points. Further, AUD, NZD & CAD can maintain their strength if the US Dollar continue being weaker and there are no more negatives from China whereas Crude may find it hard to sustain latest recovery due to Russia-Saudi Arabia’s intention to recall late-2016 oil production levels.

Technical Analysis

EURUSD’s U-turn from 1.1725 needs to clear the 1.1820 barrier in order to meet the 1.1900, the 1.1940 and the 50-day SMA level of 1.1960, failing to which can recall 1.1725 & 1.1640 as quotes. Further, the GBPUSD has 1.3300 & 1.3240 as supports with 1.3450 & 1.3500 being nearby resistances whereas USDJPY has to conquer 110.80 to mark 111.40 else it can drop to 109.70 & 109.10 levels. Moving on, the 1.3045 could keep limiting USDCAD’s rise towards 1.3100 and highlights the 1.2920 & 1.2860 rest-points while AUDUSD has 0.7515 TL as immediate support, breaking which it can drop to 0.7470 but a bounce from the same can reprint the 0.7600 & 0.7645 on the chart. At last, NZDUSD seems rising to 50-day SMA level of 0.7065 that holds the gate for the pair’s rally to 0.7100 whereas 0.6970 & 0.6940 can act as adjacent supports if prices reverse from present levels.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 15 – June – 2018

Hello Traders,

When everybody was waiting for the ECB to announce end of its massive monetary stimulus, none knew that Mr. Draghi could disappoint Euro Bulls even after declaring the end of bond purchases by year-end. Thursday proved to be a nightmare for all those who expected QE end will precede the ECB’s rate-hikes and fuel the EUR. The European Central Bank (ECB) did reveal that its mammoth bond purchases will cease to exist by this year-end; however, the central-bank President, Mario Draghi, wiped the optimism off by saying that no rate-hike is expected to take place until the second half of 2019. As a result, the Euro plunged across the board as the central-bank’s action was quite in contrast with the Fed’s hawkish outlook & dot-plot up-gradation released previous-day.

While Euro’s plunge was a strong boost to the US Dollar, upbeat Retail Sales provided additional strength to the greenback gauge (I.USDX) to test the highest closing since November 2017. With this, the USD ruled forex buyers’ minds and they dumped most of other major currencies wherein GBP was comparatively lesser affected due to strong UK Retail Sales. Among the losers, AUD was bitterly hit as soft Chinese data-points and AU employment stats played their roles while CAD & NZD also declined on commodity basket’s dip because of the USD’s rally. Further, the JPY & Gold traded southwards as rise in greenback negatively affected the safe-havens whereas Crude extended its recovery on news of supply halt at two of Libya’s biggest ports.

As the Fed & the ECB have already announced their results and portrayed market moves, investor attention turned back to trade issues between US & China with US President’s readiness to provide a list of Chinese goods to be levied stiff tariffs of around $50 billion. The China, in retaliation, also threatened to take hard measures and dump previous promises if US announces any such tariffs.

On the economic side, Bank of Japan matched market consensus of not altering their present monetary policy but downgraded their inflation forecast and dragged JPY further towards south while updates from Deutsche Bundesbank revealed that the German central-bank slashed growth forecast for the EU’s largest economy, which in-turn added weakness into the EUR.

Even if US-China trade issues could keep being in highlight, some second-tier details like EU Final CPI, US Empire State Manufacturing Index & Prelim UoM Consumer Sentiment could offer intermediate trade opportunities to market-players. Among them, the EU Final CPI isn’t expected to change from 1.9% initial forecast but the US Empire Manufacturing Index could soften to 19.1 from 20.1 mark. Moreover, the U.S. Prelim UoM Consumer Sentiment might offer strength to the USD by posting 98.5 figure compared to 98.0 prior.

If the US announces the list of Chinese Goods to be levied tariffs worth $50 billion, as Mr. Trump promised to do by Friday-end, the resultant political pessimism might hurt the USD & commodity currencies while the EUR can take benefit of upbeat inflation figure. On the contrary, any surprise talks between US-China and avoidance of tariffs may add strength into the USD and make it progress in its weekly gains.

Technical Talk

USDCAD’s successful break of 1.3120 enables it to claim the 1.3200 & 1.3270 but failure to sustain the breakout might quickly drag the quote to 1.3060. Further, the USDJPY has to surpass 111.00 in order to aim for 111.40 else it can come down to re-test 110.00 & 109.80. At the end, the EURGBP bounced off the 0.8725 support and may aim for 0.8760 & 0.8790 with 0.8695 being a support to watch if the pair fails to hold its U-turn.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 18 – June – 2018

Hello Traders,

In addition to the ECB’s dovish tone dragging the EUR down, welcome economics helped the US Dollar Index (I.USDX) to regain its strength & mark upside by weekend. As a result, safe-havens like JPY & Gold had to decline whereas commodity-linked currencies, namely AUD, NZD & CAD, registered noticeable losses as rise in USD has higher negative impact on commodity basket specially at the time when trade-war concerns are in limelight. Further, the GBP also dropped against the USD but managed to remain firm when compared to other majors due to positive developments at Brexit & not so sluggish data-points. Moving on, the Crude prices posted another negative weekly closing as concerns favoring the Russia & Saudi Arabia’s push for recalling early 2017 production levels countered US stockpile depletion.

Although widening gap between ECB & Fed’s outlook was the main market mover during last-week, optimism after Singapore summit and rejuvenated trade-war issues between U.S. & China also contributed towards offering an active week to traders.

On Friday, US came up with a list of nearly 800 import items from China that will bear 25% tariff and will offer $50 billion of loss to the dragon nation. In retaliation, the Chinese authorities also issued a list of around 660 US products that will have to carry a 25% duty and could generate $34 billion of relief to the world’s second largest economy.

During early-Monday, an earth-quake hit Japan’s industrial heartlands, Osaka, by taking a life of three people and injuring near 100 while a surprise trade deficit also offered an active start to the week. It should also be noted that Chinese markets are close for the day whereas UK’s House of Lords will have an interesting day when Theresa May will try convincing her opponents & some of her own party members about her Brexit proposal, failing to which might challenge her authority and push her back to negotiating table with EU.

While Geo-political plays concerning the Brexit & US-China trade-war could keep entertaining momentum traders on Monday, the economic calendar is almost silent with no major data-points to flash.

Given the feud between US & China, chances of commodities & commodity currencies to lose some more weight are too high whereas USD may trim less of its gains due to Fed’s optimism. Furthermore, GBP could continue remaining in pressure unless Theresa May manages to please House members whereas JPY & Gold could benefit from such macro Geo-political problems.

Technical Talk

With the political pessimism at UK, the GBPUSD may re-test 1.3200 support, breaking which it can drop to 1.3175 whereas 1.3300 & 1.3345-50 can offer immediate resistances to the pair. In case of the USDJPY, an upward slanting TL support of 110.00 seems crucial to watch, which if broken could drag the quote to 109.70 while successful break of 110.80 can reprint 111.20 on the chart. Additionally, EURCAD’s BPC formation signals the pair’s upside with 1.5325 & 1.5370 being nearby resistances and 1.5250 & 1.5200 being adjacent supports to watch.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 19 – June – 2018

Hello Traders,

Friday’s trade-war concerns between the U.S. and China became fierce on Monday when world’s two largest economies engaged in another round of threats to each other. As it was a holiday in China, the dragon nation remained initially silent after slapping around $34 billion of tariffs on US goods during weekend by terming it a mark of retaliation to $50 billion tariffs from the former; however, US President Donald Trump surprised global markets by warning China to witness 10% additional tariffs on nearly $200 billion of goods if it continues to hurt US intellectual properties and retaliate the earlier action. With this, risk-off triggered the buying of JPY, Gold & CHF while US Dollar had to bear the burden of Mr. Trump’s trade protectionism.

While USD’s decline provided much needed relief to the EUR, the GBP couldn’t avoid declining as Theresa May’s failed to win the vote in House of Lords and now has to witness a tension filled day on Wednesday when House of Commons will vote on whether the UK parliament should have a final say on Brexit or not. Moving on, AUD & CAD plunged as trade protectionism threatens commodity front; though, NZD managed to remain on positive side as being comparatively stronger among commodity-linked currencies. Moreover, the Crude prices witnessed pullback as speculations grew that Russia & Saudi Arabia’s proposal to increase output may not be fully satisfied during this weekend’s meet of major energy producers.

On Tuesday, when Chinese traders returned to their desks, policymakers of world’s second largest economy addressed new threats from US by saying that “they will have to take comprehensive quantitative and qualitative measures and retaliate forcefully.” As a result, USD declined during initial trading session but shortly recover majority of its recent losses when ECB President Mario Draghi appeared at the central-bank’s Forum on Central Banking. Mr. Draghi tried assuring investors that the ECB’s path to lose monetary policy is an ideal one unless macro situations improve.

With the ECB President’s speech market attention again turned to the monetary policy divergence between the Fed & the ECB, which in-turn could keep entertaining the greenback bulls for the day. However, any progress on the list of $200 billion goods to carry fresh tariffs, either by China or US, might again hurt the US Dollar. On the other hand, GBP might keep witnessing downside pressure due to Brexit concerns while AUD, NZD & CAD could depend upon the greenback’s reaction to ECB President’s speech.

At the economic front, US Housing market numbers, namely Building Permits & Housing Starts, are the only indicators that could entertain momentum traders. Herein, the Building Permits are expected to mark 1.35M figure against 1.36M while the Housing Starts could print 1.31M number compared to 1.29M prior.

Considering the renewed trade-war concerns, coupled with US housing market numbers & ECB Forum, investors may find Tuesday being a bit more active than the previous-day.

Technical Talk

Even after declining heavily during recent days, the 0.7365-60 support-zone, coupled with oversold RSI, could trigger the AUDUSD’s pullback towards 0.7415 & 0.7450, failing to which can recall the 0.7330 & 0.7300 levels on the chart. Further, the NZDUSD just dropped beneath immediate ascending trend-line support, at 0.6925 now, which in-turn signals the pair’s downside to 0.6880 & 0.6850 whereas sustained trading beyond 0.6925 may help it revisit the 0.6960 resistance-mark. In case of the AUDNZD, the pair could bounce off the 1.0660-55 support-zone to aim for 1.0700 & 1.0740 but dip beneath the 1.0655 might not hesitate dragging prices to 1.0615 level.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 20 – June – 2018

Hello Traders,

Ever since Mr. Trump announced fresh $50 billion tariffs on Chinese goods, followed by the dragon nation’s retaliation of $34 billion tariffs on US items, the trade-war concerns again troubled global markets after a short break when these two economies held discussions. Such pessimistic waves got additional strength on Tuesday when the U.S. President Donald Trump ordered his team to identify Chinese goods worth of $200 billion to bear extra duties and another $200 billion of items if the China again responds with their tariff hikes on US products. In its response, Chinese authorities threatened to forcefully retaliate US trade protectionism. Due to this tit-for-tat actions between world’s two largest economies, global investors witnessed another volatile day. However, the US Dollar managed to post a positive daily closing because of upbeat Housing Starts & ECB President’s dovish comments at a forum discussion in Portugal dragged the EUR down.

Moving on, the commodity currencies like AUD, NZD & CAD were badly hit as threat of trade-war negatively affected the commodity front’s future demand forecast. In all these ups & downs, the JPY & CHF were winners as risk-off sentiment highlighted the safe-havens. Additionally, GBP couldn’t avoid USD’s strength & Brexit pessimism whereas Crude also declined on escalating threats from trade front & news that Russia & Saudi Arabia have started pushing other major producers to respect their wish of dialing back output cut accord.

During early Wednesday, the trade front flashed another signal after US President said NAFTA talks are progressing and updates rolled out that Russia is planning to levy tariffs on US products as a part of its retaliation to US steel tariffs. Though, the US Dollar didn’t lose its charm due to some events scheduled for today that can possibly show comparative strength of the US economy & its monetary policy against rest of the developed economies.

One of the important events is panel discussion between the heads of ECB, Fed, RBA & BoJ at ECB’s central-bank policy forum in Sintra, Portugal. Another one is votes challenging Theresa May’s Brexit proposal at the UK’s House of Commons. While aforementioned qualitative events could appear in the headlines, US Existing Home Sales, Crude Oil inventories and New Zealand’s quarterly GDP might keep traders busy during the day.

Looking into details, the discussion at ECB forum is likely to be a big plus point for the USD as it should shift market attention off the trade issues to Fed’s strength vis-a-vis RBA, ECB & BoJ. However, any disappointment from the same may have higher repercussions. Moving on to the UK, after failing at House of Lords, Theresa May has to win over the House of Commons in order to justify her strength as a British leader. The issue is with some opponents and her own colleagues joining hands to demand a final say on Brexit bill. If May fails, she would have to abide by the compulsion of going back to discussion table with EU in case of no deal by deadline. As a result, an outcome may either help the GBP or conquer it for the short-term unless any strong statements roll out of the BoE.

At the data front, US Existing Home Sales could please the greenback buyers with 5.52M figure against 5.46M earlier while the Crude stockpile can result further weakness of energy front if meeting -2.1M forecast versus -4.1M prior. In case of the New Zealand GDP, the Q1 2018 growth figure may provide additional weakness to the NZD if it matches the 0.5% consensus compared to 0.6% previous-mark.

While trade-war threats have been in lime-light since the start of the week, presence of crucial events could shift market attention off to it and make global investors busy.

Technical Talk

USDCAD’s sustained trading beyond a longer-term ascending trend-line, at 1.3275, signals brighter chances for the pair’s further rise towards 1.3330 & 1.3380 resistance but a daily closing beneath the 1.3275 might not hesitate flashing 1.3230 & 1.3200 on the chart. On the contrary, the USDCHF seems struggling in the 0.9980 & 0.9900 range with 1.0035 & 0.9880 being follow-on levels to watch during either side break. At the end, CADCHF is likely reversing from 0.7480-70 support-zone towards 0.7515 and then to the 0.7540 but failure to sustain the U-turn could drag the pair to 0.7430-25 rest-area.

Have a nice trading-day ……

[FxAnil]

Weekly Fundamental Dose: 21 – June – 2018

Hello Traders,

While Donald Trump’s aggressive stance on “America First” agenda highlighted the Sino-U.S. trade tussle since start of the week, upcoming meetings by BoE & global energy producers, coupled with headline economics from EU, US & Canada, could push investors to shift their attention off the trade tensions.

Hence, it becomes important to discuss fundamentals concerning those events/details. However, it’s important to first understand what has happened in the global forex market off-late.

Monetary Policy Divergence Helped the USD

Having declined for two consecutive weeks, the US Dollar Index (I.USDX) managed to post a strong positive closing at the end of last-week as Federal Reserve’s dot-plot indicated increased pace of rate-hikes whereas ECB talked down the need of rate-alterations until mid-2019. Other than monetary policy divergence, successful summit between US & North Korea and absence of sluggish data-points also offered strength to the greenback. Further, the EUR had to bear the burden of ECB’s dovish stand whereas GBP registered gains, except against the USD, on progress at Brexit front & welcome UK stats. Moving on, the safe-havens, namely JPY, CHF & Gold, also declined as stronger USD boosted risk-on sentiment while AUD, NZD & CAD dropped heavily as speculations for trade-war between the U.S. & China, together with USD strength, disappointed commodity buyers. Additionally, Crude prices marked fourth consecutive weekly loss despite drop in US inventories as Russia & Saudi Arabia seem tough to propose recalling early 2017 output-levels to global energy producers when they meet next week.

U.S-China Trade-War Remained Highlighted Off-Late

Even if the US Dollar managed to post a weekly positive closing, it had to drop on Friday against majority of its counterparts when U.S. President Donald Trump announced $50 billion of tariffs on Chinese goods and renewed trade-tussle between world’s two largest economies. The same moves carried forward during the present week when China retaliated to US protectionism by announcing $34 billion tariffs on US items. In response to the same, US President Donald Trump ordered his team to identify Chinese goods worth of $200 billion to bear additional 10% duty and another set of $200 billion of goods to have extra tariffs if China again retaliates to such measures. Hence, the game of tit-for-tat between the U.S. & China kept entertaining the investor fraternity till Wednesday. Though, the USD was a clear winner during the same as upbeat data-points, hawkish Fed and comparative strength of the US President’s bargaining power performed their roles.

Given the USD was gaining, JPY & Gold traded southwards whereas commodity-linked currencies, namely AUD, NZD & CAD, had to decline. In case of the EUR & GBP, the regional currency remained weaker due to comparative USD strength but the Pound dropped earlier when UK PM lost votes at British House of Lords and witnessed a threat to her position. The Crude prices were trading volatile ahead of
OPEC-led alliance’s meet during this Friday & Saturday.

Everyone was closely observing US-China trade-war concerns and the upcoming OPEC-led alliances till Wednesday. On Wednesday, things changed when ECB’s forum at Portugal had a discussion between heads of ECB, Fed, BoJ & RBA. During the same, Fed Chair maintained his hawkish stand whereas BoJ Governor seemed dovish. There was one more event that got market attention on Wednesday and that’s the vote in UK House of Commons against Theresa May’s Brexit proposal wherein Mrs. PM won the voting and subsided risk to her designation. At the energy front, Iran continued talking against the Saudi Arabia & Russia’s wish to loosen the output cuts whereas higher than expected drop in US inventories offered additional strength to the Crude prices.

Time For Trade-Tussles To Take A Backseat

Following a trade-tussle driven trading-days, investors may now have an opportunity to concentrate more on economic calendar as crucial details/events are scheduled to fuel market moves.

Among them, monetary policy meeting by the Bank of England (BoE) would be the first to entertain market-players on Thursday. The UK central-bank isn’t expected to alter its monetary policy at this meeting after talking down chances of a rate-hike during May. However, the monetary policy summary will be closely observed in order to get the hint of much anticipated August rate-hike. After BoE, the US Philly Fed Manufacturing Index is likely to gain investor attention wherein the manufacturing gauge could flash 28.9 mark against 34.4 prior and may hurt the USD a bit.

On Friday, official Flash Manufacturing & Services PMIs from EU could start the day by offering hints to the strength of region’s sectors. The Flash Manufacturing PMI is likely to soften to 55.0 versus 55.5 prior while the Flash Services PMI could flash 53.7 mark compared to 53.8 earlier. Hence, softer stats could keep indicating EUR’s weakness.

If investors wouldn’t satisfy by aforementioned details/events, two-day meeting of the OPEC-led alliance of global oil producers could entertain energy traders. Other than trade-tussles, this event is considered to be the most important meeting of the week. It is because Russia & Saudi Arabia have recently shown their intention to announce recalling 2017 production levels by assuming that the purpose of output cut is almost served and producers should slowly revisit their previous output levels. However, Iran, Venezuela and some other OPEC members are against the same mentioning that US sanctions have already damaged their economy and if the output level increase, it would further deteriorate oil-based economies. Looking at the recent developments, both the sides are trying hard to get most support for their call and make the meeting important enough. Iran even threatened to use veto to avoid witnessing higher output but the group seems ready to have a bit higher output levels but not that much as Russia & Saudi Arabia thinks possible.

At last, CPI & Retail Sales from Canada also become important to watch. The CPI MoM is likely to register the 0.4% growth against 0.3% prior but the Retail Sales MoM could disappoint the buyers if matching 0.0% forecast compared to 0.6% earlier.

With the crucial events likely to grab market attention off the trade-tussles, outcomes of the same become important to forecast near-term trade sentiments. While USD is likely to remain in power for a bit longer unless receiving extreme disappointments from trade front whereas sluggish PMIs could keep dragging the EUR southwards.

The GBP may also witness declines if BoE refrains to respect August rate-hikes while CAD can recover some of its latest losses given the welcome prints of headline economics; though, result of OPEC meeting will drive Crude prices and the CAD in-turn. Herein, no change in production-cut accord could fuel the energy quotes while a higher production, even being lesser than proposed might add weakness into the Oil levels.

Technical Analysis

EURUSD has to close below 1.1500 in order to meet the 1.1440 & 1.1380 while 1.1630 & 1.1720 could offer immediate resistances to the pair. For GBPUSD traders, 1.3030 & 1.3000 seem important supports with 1.3240 & 1.3360 being adjacent resistances to watch. Further, USDJPY has to clear 110.80 to aim for 111.40 otherwise its drop to 109.45 can’t be denied while USDCAD’s sustained trading above 1.3210 enables it to target 1.3350 & 1.3410 with downside break of 1.3210 offering 1.3130 as a quote. Moving on, AUDUSD signals 0.7320 re-test, breaking which 0.7250 can appear on the chart with 0.7410 likely acting as nearby resistance whereas NZDUSD has 0.6815 & 0.6775 as crucial supports with 0.6880 & 0.6930 important barriers to observe on the upside.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 22 – June – 2018

Hello Traders,

The US Dollar did lose to its counterparts on Thursday when it was revealed that some White House officials want to meet Chinese authorities, contrast to Trump’s no sign of backing down, in order to avoid a full-blown trade-war. Adding worries for the greenback buyers was more than a year’s low of Philly Fed Manufacturing Index and announcements/actions by some top-tier companies to safeguard against US-China trade-war. On the other hand, the EUR witnessed some profit-booking due to USD’s decline while the GBP rallied across the board when BoE’s Chief Economist surprised markets by voting in favor of rate-change. In case of the commodity-currencies, the AUD & the NZD managed to recover some of their recent losses as greenback’s weakness helped the commodity basket but the CAD couldn’t avoid its decline as softer economics kept dragging the Loonie southwards. Additionally, JPY & Gold also took benefit of the greenback’s weakness and pessimism surrounding trade-front whereas Crude prices stretched their earlier recovery on hopes that OPEC-led alliance might not be able to announce full-reversal to its output-cut accord.

During early-Friday, market momentum remained against the USD as some more of the global leaders either retaliated or show their discontent with Mr. Trump’s trade protectionism. However, the show-stopper was the OPEC-led alliance’s meeting in Vienna wherein Iran has started showing its resentment to the Russia & Saudi Arabia’s proposal to increase group’s output by around 1 million by assuming that their purpose for production-cut agreement is mostly served now. As a result, the Crude prices rallied noticeably and the same fueled CAD together with some other commodity-linked currencies like AUD & NZD.

While USD was trading down and commodity currencies managed to extend their up-moves, the JPY remained a bit on the back-foot but the Gold gained on the uncertainty at energy front. Further, the EUR could keep being strong for one more day even as EU Flash Services PMI surpassed forecast & Flash Manufacturing PMI marked soft numbers whereas the GBP seems still enjoying yesterday’s BoE outcome.

Looking forward, result of the two-day long energy-producers’ meeting and the headline Canadian stats, namely CPI & Retail Sales, could keep entertaining the investors for rest of the day. For Canadian details, the CPI could please the Loonie buyers with 0.4% mark against 0.3% earlier while the Retail Sales may weaken the optimism if matching 0.0% consensus versus 0.6% earlier growth. Though, Core Retail Sales are expected to reverse prior -0.2% contraction with +0.5% expansion and may keep the CAD strong.

In case of the energy producers’ meet, Saudi Arabia & Russia have already gathered some supports among the group and seem ready to have a deal of increasing join output by nearly 1 million a day despite Iran’s threat to use veto. However, the drama could keep making energy front volatile enough to entertain momentum traders unless actual outcome takes place. Should Iran manages to succeed in its wish to have the current output levels, the Crude prices & CAD can have a boost while Russian-Saudi Arabia’s win has a measured impact on the quotes depending upon how much increase to production-level they could achieve.

Hence, while OPEC-led alliance is near to important decision and Canadian economic calendar is also to release crucial stats, investors are all ears to hear developments from these catalysts.

Technical Talk

Even after bouncing off the 1.1500 mark, the EURUSD needs to surpass the 1.1720 & 1.1770 in order to aim for 1.1840 mark otherwise chances of its pullback to 1.1590 & 1.1500 re-test can’t be denied. Further, USDCAD couldn’t surpass the 1.3350 and the resulted profit-booking signals the pair’s drop to 1.3260 & 1.3200 while an upside break of 1.3350 can quickly flash 1.3400 on the chart. Moving on, the NZDCHF’s U-turn from 0.6790 TL favors the pair’s rise to 0.6860 & 0.6880 while 0.6750 & 0.6730 can entertain sellers if the quote dips beneath the 0.6790 trend-line.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 25 – June – 2018

Hello Traders,

Lack of big economic releases and on-going trade-war concerns between the U.S. and China resulted into a negative weekly closing by the US Dollar Index (I.USDX) during last-week. The EUR, on the other hand, managed to post gains on welcome economics from Germany & France, backed by Italian politician’s another assurance that the nation won’t leave single currency region. Further, the GBP benefited from the BoE’s outcome when the central-bank’s chief economist surprised markets by voting in favor of a rate-hike. Moving on, the JPY kept being stronger as pessimism surrounding trade-tussles to hurt the global growth helped safe-havens but the same couldn’t support Gold prices as it challenged China’s future demand of the yellow metal. Additionally, NZD had to bear the burden of weaker GDP and the CAD couldn’t avoid sluggish CPI & Retail Sales figures while the AUD recovered all of its early-week losses on Friday and marked positive weekly closing with decline in the USD activating commodity-front’s pullback. At the end, Crude remained mostly upbeat by the end of last-week as surprise drop in US inventories and expected increased in fuel-demand during summer season pleased energy traders despite the fact that OPEC-led alliance is going to shoot the output.

After Saudi Arabia & Russian victory over Iran in receiving a production-hike accord at last-week’s meeting, investors shifted their attention back to on-going trade tussles emanating from the U.S. Herein, Mr. Donald Trump again surprised markets by threatening EU assembled cars-makers to be ready for witnessing 20% tariffs. As a result, EU policymakers communicated their angst against the world’s largest economy by showing their readiness to retaliate if such tariffs take place.

For China, US President kept pushing White House administration to prepare list of another $200 billion of goods to bear additional 10% tariffs while dragon nation showed no sign of retaliating the same by early-Monday.

During Monday, news that Turkey is going to have a stable government after recent election fueled Turkish Lira but the JPY kept being strong as harsh comments from EU signaled added pessimism at trade front. However, the USD remained mostly upbeat as investors expect US-China meeting to resolve the present trade-wars and the Fed’s hawkish tilt entertained buyers. Due to the same, the EUR & GBP, together with commodity currencies, trimmed some of their latest gains while Crude dropped on weekend news concerning increased output from global producers.

Moving forward, US New Home Sales becomes the only economic detail to entertain momentum traders for the day as German IFO Business Climate Index has already dragged the EUR. In case of the US Housing market figure, consensus shows a 665K mark against 662K prior and can help the greenback recover some of its latest losses.

In all these developments, US protectionism is likely to keep entertaining investors as EU is the new one to join China and Canada to speak against Mr. Trump’s policies in public, which in-turn could be negative for the USD and help the JPY to keep being strong.

Technical Talk

Inability to surpass 0.7445-50 resistance-region seems dragging the AUDUSD towards 0.7390 & 0.7370 supports but an upside break of 0.7450 can quickly flash 0.7480 & 0.7510 as quotes. Further, USDCHF is likely taking a U-turn from short-term ascending trend-line, at 0.9875 now, which in-turn signals brighter chances for the pair’s recovery to 0.9900 & 0.9920 resistances whereas dip beneath the 0.9875 can recall 0.9855 & 0.9825 on the chart. At last, EURAUD has to clear the 1.5770-75 resistance-confluence in order to aim for 1.5820 & 1.5850 else chances of its pullback to 1.5615 & 1.5590 TL support can’t be denied.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 26 – June – 2018

Hello Traders,

Monday was another day when the US Dollar had to decline because of retaliation from global trade-peers against Mr. Trump’s “America First” agenda; however, this time China wasn’t alone as EU & Chinese policymakers released joint warnings to the U.S. President’s trade protectionism. While threats concerning global trade-wars likely being a big negative for future growth strengthened, the JPY and the CHF remained as favorites of investors because of their safe-haven appeal but the Gold couldn’t enjoy the same as worrisome signs for China, world’s largest bullion consumer, hurt the yellow metal. Moving forward, the GBP & EUR benefited from the USD’s decline even without having any other big positives whereas commodity-linked currencies, namely AUD, NZD & CAD, dropped as pessimism surrounding the biggest commodity user, China, disappointed these currencies’ traders. Additionally, the Crude prices also registered downside due to aftershocks of results from OPEC-led alliance’s meet.

During early-Tuesday, the US Dollar recovered some of its latest losses on the news that White House administrators are divided over the upcoming US treasury release which can add troubles for China. With this, Gold had additional negative factor to follow and dropped to the fresh 2018 lows while GBP maintained its strength. However, EUR softened a bit but the JPY didn’t lose its allure. In case of AUD, NZD & CAD, all of them continued declining against the greenback. At the end, Crude prices recovered a bit on uncertainty over Libyan Oil exports.

Looking forward, Tuesday has comparatively bigger line of economic-stats than Monday which includes monthly release of US CB Consumer Sentiment Index and the New Zealand Trade Balance. Forecasts suggest a 127.6 mark for the US consumer sentiment gauge versus 128.00 prior whereas New Zealand trade surplus is expected to shrink to 100M from 263M earlier.

While on-going trade-tussles between the US & rest of developed world economies join second-tier stats from US & New Zealand to offer an active trading-day, the political drama at Germany might also entertain momentum traders. Herein, Mrs. Angela Merkel is scheduled to hold private talks with her coalition leaders to discuss refugee policies when the migration dispute challenges her authority.

To sum up, scheduled US details, even if sound a bit softer, is less likely to disappoint greenback buyers considering recent consumer-centric figures from the U.S. but any aggression on trade-front could hurt the USD. As a result, the JPY & GBP could maintain their advances while EUR had to bear the burden of German pessimism. Also, the commodity front might keep struggling due to threats on China’s future strength, which in-turn could drag the AUD, NZD & CAD further towards south. It should also be noted that rising US production & recently agreed output increase by OPEC-led alliance could challenge the Crude’s latest recovery.

Technical Talk

Given the 0.6920 resistance restricting the NZDUSD’s immediate advances, chances of the pair’s drop to 0.6850 & 0.6825 are much brighter but an upside clearance of 0.6920 can quickly fuel the quote to 0.6975 & 0.7000 round-figure. Further, GBPUSD’s recent U-turn from 1.3230 favors its recovery towards 1.3300 & 1.3340 levels with 1.3230 & 1.3190 being nearby supports to watch during the pair’s decline. Moreover, the EURJPY needs to clear 128.50-60 resistance-region in order to meet the 129.30 & 129.50 levels otherwise its pullback to 127.70 & 127.50 can’t be denied.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 27 – June – 2018

Hello Traders,

In spite of registering softer than expected CB Consumer Confidence figure, the US Dollar Index (I.USDX) marked a positive daily closing on Tuesday when the U.S. President Donald Trump’s statements signaling lesser hardships for Chinese investments buoyed global investor sentiment in favor of the greenback. The Euro, on the other hand, had to liquidate some of its recent gains as USD strength and political pressure on German Chancellor’s support for Immigration & EU budget weighed down the regional currency. While Mr. Trump managed to please trade-optimists on Tuesday, he simultaneously pressed allies to dump Iranian crude imports & funding, which in-turn propelled Crude prices that got additional support from another decline in API stockpile number.

Moving on, AUD, NZD & CAD continued trading southwards due to the US Dollar’s recovery whereas JPY & Gold also dipped because of the same reason. In case of the GBP, comments from an incoming BoE policymaker, which mentioned risk of raising interest-rates too fast, dragged the British currency downwards.

If we observe market behavior during early-Wednesday, we can say that trade-war risk is still present as news that some White House policymakers proposed to waive the recent favor for China’s ZTE corporation rejuvenated the speculations of US-China trade-tussle. Also, upbeat reading of China’s Industrial Profits and disappointing prints of New Zealand’s ANZ Business Confidence made lesser mistake in playing their roles.

While economics from China & New Zealand have already offered a good start to the day, scheduled readings of US Durable Goods Orders, BoE’s Financial Stability Report and monetary policy meeting by the Reserve Bank of New Zealand (RBNZ) could result in another eventful day for market watchers. Moreover, speeches by one FOMC member, BoE Governor & BoC Governor, coupled with weekly release of US Crude inventories, might add volatility into the markets.

Looking at the data-points, Durable Goods Orders can cut its earlier contraction of -1.6% by -0.9% depletion but the Core Durable Goods Orders may post weaker growth of 0.5% from 0.9% previous. Further, the Crude Oil inventories could trigger the profit-booking of energy prices if meeting -2.4M forecast compared to -5.9M prior. Moving on, BoE & BoC Governors might justify their cautious view on monetary policy but any pessimism by the Bank of England Governor could make the GBP vulnerable to plunge. Furthermore, the FOMC member may not risk going against the Fed’s hawkish plan and could help the USD extend its recent upside while RBNZ’s expected dovish delivery might add worries for the NZD buyers.

Hence, with the heavily-packed economic calendar and on-going trade-tussle between the U.S. & rest of developed world being in limelight, market-watchers are likely to have another eventful & active day ahead.

Technical Talk

Even after bouncing of the 50-day SMA, at 109.65 now, the USDJPY presently struggles with 200-day SMA level of 110.20 in order to justify its recent recovery, which in-turn signal brighter chances of the pair’s pullback to 109.65 and then to the 109.45 trend-line support. However, an upside break of 110.20 can propel the quote towards confronting the month-old descending TL, at 110.70. Further, USDCAD’s U-turn from 1.3250 again favors its rise to 1.3385 & 1.3430 with 1.3210-1.3200 being a follow-on rest-zone to observe during the pair’s dip beneath the 1.3250. Additionally, NZDCAD’s breakdown of 0.9110 makes it weaker enough to test 200-day SMA level of 0.9040 ahead of targeting 0.9000 psychological-magnet while 0.9110 and the 0.9170, including 100-day SMA, could limit the pair’s near-term upside.

Have a nice trading-day ……