Daily Fundamental Dose

[FxAnil]

Weekly Fundamental Dose: 23 – August – 2018

Hello Traders,

Although FOMC minutes are already out and loud to help the USD recover some of its latest losses, headline EU PMIs, annual meeting of global financial leaders at Jackson Hole and political plays surrounding US & Australia are still left to propel market moves. Not only this, US New Home Sales, Durable Goods Orders and Japan’s CPI are some additional factors that investors might be interested in reading.

Let’s start discussing each of these catalysts in detail.

Trade Optimism Dragged The USD Down

Having registered noticeable gains in past few weeks, the US Dollar Index (I.USDX) finally marked a negative weekly closing during last-week as China’s readiness to initiate trade-talks with the U.S. after few months of block dimmed the greenback’s safe-haven appeal while mixed data-points dragged the currency gauge further towards south. As a result, the commodity-linked currencies, namely AUD, NZD & CAD, took a U-turn from their lows but the JPY & Gold became victims of risk-on market sentiment. Further, EUR & GBP surged as upbeat data-points outpaced Brexit pessimism while Crude dropped on increasing US inventories and worries concerning future demand at the time when trade protectionism is hurting global economies, especially China.

Political Backlash For Trump Added Weakness Into Greenback Before FOMC Minutes

While trade optimism was already weighing on the U.S. currency, news that US President criticized Fed’s role and two of Mr. Trump ex-political aides, namely former personal lawyer Michael Cohen and campaign chairman Paul Manafort, pleaded guilty on various counts, including hush-money paid to a playboy model, added weakness into the greenback since the week-start. However, the FOMC minutes offered a sigh of relief to USD optimists during early Thursday as the statement conveyed policymakers’ readiness to keep increasing interest-rates during the next-year if economy allows.

During early-week, the EUR benefited from the USD’s decline while GBP strengthened on speculations that UK will be able to secure a soft Brexit by October. Further, the NZD & the CAD enjoyed the US Dollar’s weakness and upbeat data-points at home but the AUD dropped as political trauma at the nation challenging PM’s status dragged the currency southwards. Though, JPY couldn’t avoid sellers as signals from BoJ officials still favor lose monetary policy but the Gold gained due to USD’s drop. Additionally, the Crude prices surged as readiness on the part of U.S. to release strategic reserves and surprise drop in inventories pleased energy traders.

At the political front, Turkey has a week-long break but still keep complaining of the U.S. behavior while China has also indicated displeasure with Mr. Trump’s trade-protectionism after witnessing 25% of tariff hike on another $16 billion worth of goods. Moreover, Iran is also against the US sanctions whereas EU is criticizing Russian behavior and pushes various global leaders to join in the punishments for the Vladimir Putin led economy.

Not Only Politics But Economic Calendar Also Heats-Up

Given the on-going low-level talks between the U.S. & Chinese trade ministers and political backlash for Mr. Trump and Mr. Turnbull being much anticipated news, slew of upcoming details/events could also offer busy trading sessions to market players. Among them, EU PMIs, Fed Chair’s speech at Jackson Hole Symposium, Japanese National Core CPI & US Curable Goods Orders are likely gain much of market attention.

Starting with the Thursday’s EU Flash Manufacturing & Non-Manufacturing PMI, both the headline economic gauges are likely to maintain their previous levels of 55.1 & 55.4 and hence are less expected to alter EUR moves unless registering extreme contraction to forecasts. After EU PMIs, monthly reading of US New Home Sales could entertain momentum traders on Thursday as the housing market indicator is likely flashing 643K mark compared to 631K earlier.

On Friday, Japan’s National Core CPI could start the day with positive news for the JPY Bulls if matching +0.9% consensus against +0.8% prior. After then, the U.S. Durable Goods Orders could become disappointment for the USD optimists as expectations favor -0.7% mark versus +0.8% previous but Core Durable Goods Orders, indicating +0.5% growth vis-a-vis +0.2% prior, could help limit the greenback’s downturn.

Even if investors feel satisfied with the moves offered by aforementioned factors, they won’t ignore Fed Chair’s speech at the annual gathering of global financial leaders taking place at Jackson Hole. The gathering becomes crucial as not only global central-bankers but some of the crucial financial market players also remain present at the event that has historically fueled trade-sentiments by offering hints of critical policy moves.

The event becomes even more important for the USD traders this time as Mr. Trump becomes the first President to show his resentment from Fed in public in nearly a decade. As a result, analysts will closely examine as to how the Fed Chair, Jerome Powell, manage to convey his rate-hike policies and expected reversal of balance-sheet debt.

Other than these catalysts, how US & Chinese policymakers reach to strike a balanced trade proposal for their leaders to discuss and how Mr. Trump could confront Turkey, Iran and Robert Mueller’s investigation could also become important to observe.

Unless sticking to his hawkish statements without uttering trade-related problems and Mr. Trump’s criticism, the Fed Chair can’t please the USD buyers at the time when not only international leaders but the domestic investigators are also causing problems for the greenback.

On the other hand, commodity-currencies may have to wait for the Sino-US trade-talk results to recover their latest losses while AUD seem weaker as AU PM Turnbull face another challenge after winning Tuesday’s voting as several top-tier leaders resigned and demand one more poll.

With the political plays likely activating risk-off market sentiment and the U.S. President is also witnessing hard-time, the JPY & the Gold could mark gains while EUR & GBP may have to rely on greenback moves and Brexit developments to signal near-term moves.

Technical Analysis

EURUSD fall short of clearing 50-day SMA level of 1.1610, which in-turn signal brighter chances of the pair’s drop to 1.1500 and the 1.1430 re-tests; though, a D1 close beyond 1.1610 could propel the quote to 1.1680 trend-line. On the contrary, the GBPUSD is still away from 1.2955-60 resistance-region, break of which can help it confront the 50-day SMA level of 1.3075 while 1.2800 & 1.2680 may offer immediate supports during the pair’s decline. Further, USDJPY has to conquer the 111.00-05 resistance-confluence comprising 50-day SMA & adjacent TL in order to aim for 111.50 & 112.00 levels otherwise its pullback to 110.35 and then to the 110.00-109.85 support-confluence, including 100-day & 200-day SMA, can’t be denied.

In case of the USDCAD, the pair bounced off the 100-day SMA and may challenge the 1.3060, followed by the 50-day SMA level of 1.3135, ahead of looking at the 1.3180 mark while a daily close beneath 1.2975 might not hesitate fetching the pair to 1.2910. Moving on, AUDUSD broke nearby support-line and can revisit the 0.7250 & 0.72000 rest-points with 50-day SMA level of 0.7385 and the 0.7440 are expected to keep limiting the quote’s short-term advances. At last, the NZDUSD also reversed from 0.6720-25 resistance-confluence but has to dip below 0.6670 TL support to extend its downturn towards 0.6640 and the 0.6600 support whereas 0.6715 and the 0.6725 are likely crucial resistances for the traders to watch as break of which can flash 0.6760 on the chart.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 24 – August – 2018

Hello Traders,

In addition to upbeat FOMC minutes that strengthened the US Dollar during early Thursday, the greenback rose further on its safe-haven appeal as failed trade-talks between the China & the U.S. reignited trade-war fears. While US Dollar Index (I.USDX) managed to register first positive daily closing in previous six, the EUR dropped on weaker than expected PMIs and Italian deputy PM’s threat to cut EU funding if other regional countries keep resisting migrant intakes. On the same line, the GBP also declined as British government stepped up plans to make UK companies prepared for no-Brexit deal. Further, the AUD dropped on political pessimism at the nation while NZD & CAD couldn’t avoid a blow to commodity basket on failed Sino-US talks. Moving on, the JPY & Gold rejoined south-runs on stronger USD and the Crude prices also weakened a bit due to trade-war fears’ likely negative impacts future energy demand.

Having witnessed a positive daily closing of the US Dollar on yesterday, global investors remained cautious at the start of Friday trading as they await speech by the Federal Reserve Chairman, Jerome Powell, at annual gathering of global financial leaders in Jackson Hole Wyoming. However, the same couldn’t restrict AUD from recovering its recent losses after Treasurer Scott Morrison became new AU PM & replaced Malcolm Turnbull, ending latest political uncertainty for the time being. At the data-front, soft Japanese National Core CPI continued dragging the JPY southwards while lesser than forecast New Zealand Trade Balance helped the NZD to benefit from short-covering.

Even if Fed Chair’s Jackson Hole speech is something that all investors are waiting for, monthly reading of US Durable Goods Orders can provide intermediate trade opportunities to short-term traders. Consensus indicate a -0.7% print of Durable Goods Orders and a +0.5% mark for Core Durable Goods Orders against their respective priors of +0.8% and the +0.2%.

While no major change to the US Dollar’s present condition is likely to take place if Durable Goods Orders numbers meet forecasts, extreme readings of both the details can trigger the greenback moves even before Mr. Powell’s speech.

In case of the Jackson Hole Symposium speech, global financial leaders have already started believing that Mr. Powell will stick to his optimistic tone of gradual future rate-hikes and balance-sheet reduction but Mr. Trump’s latest criticism to Fed may restrict the central-banker from being too hawkish. In addition to the quantitative details about how far the Fed sees their interest-rates going during next-year, investors may also investigate clues relating to the trade-war’s impact on monetary policy.

As it’s an annual gathering of leaders, no monetary policy decisions are likely to be announced but clues relating to the same have historically made this event crucial. Hence, the US Dollar is likely to benefit if Mr. Powell sticks to his upbeat economic outlook and gradual rate-hikes but the gains can be challenged a bit given the central-banker seem worried for global trade-war.

Technical Talk

Even if EURUSD’s sustained trading above short-term ascending trend-line portrays the pair’s strength towards targeting the 1.1620, its further upside can be challenged by seven-week long downward slanting TL, at 1.1670. Alternatively, pair’s dip beneath the 1.1540-35 support-zone can recall the 1.1480 and the 1.1430 as quotes. Meanwhile, the USDJPY broke month-old descending trend-line resistance and is aiming for the 112.15-20 and the 112.65-70 upside numbers whereas 110.70 & 100-day SMA level of 110.10 could restrict the pair’s near-term declines. At the end, the EURAUD has to surpass the 1.5930 resistance-line in order to meet the 1.6000 and the 1.6120 levels otherwise its pullback to the 1.5820 and the 1.5780 can’t be denied.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 27 – August – 2018

Hello Traders,

Other than political backlash for US President Donald Trump, Fed Chair Jerome Powell’s refrain to accelerate rate-hike pace at Jackson Hole speech defied upbeat FOMC minutes and dragged the US Dollar Index (I.USDX) for consecutive second week. These forces were strong enough to dim failure of US-China trade-talks and helped the EUR to register positive weekly closing despite sluggish PMIs. On the same way, the GBP also extended its recovery even if British policymakers urged business leaders to stay prepared for no-deal Brexit while commodity-linked currencies, like AUD, NZD & CAD, benefited from upbeat data-points at home and weaker USD. However, the JPY couldn’t please buyers as BoJ kept favoring lose monetary policy at times when Japan suffers from low inflation-rate. Moving on, the Gold prices surged on greenback’s decline and political pessimism at the U.S. while Crude also rallied as depleting inventories and shrinking rig counts, coupled with tensions concerning Iran sanctions, please energy traders.

During early-Monday, U.K. summer bank holiday confined market moves but disappointments from Friday’s Jackson Hole speech continued dragging the USD southwards. Though, commodity basket couldn’t enjoy this greenback dip as China’s Industrial Profits declined for third straight month and US policymakers seem ready to unleash new measures to threaten Chinese businesses. Additionally, China’s central-bank also stretched its latest moves to limit market influence over Yuan and the same strengthened the currency, which in-turn hurt the commodities. It should also be noted that upbeat prints of German IFO Business Climate Index offered additional strength to the EUR against the US Dollar.

At the political front, renowned US Republican leader, John McCain, died on Saturday while German Chancellor showed her readiness to strengthen EU against global protectionism and internal struggles between the members. Further, British Prime Minister, Theresa May, would travel three African countries during this week to increase trade-ties with them whereas Turkish players came back to market after a week-long holiday but were welcomed by cold heart as the kingdom’s feud with U.S. continue threatening the economy. While majority of the politics were not positive, NAFTA talks between US-Mexico showed progress and both the leaders are likely to give a good trade news by Monday-end.

Looking forward, UK holidays and lack of big details/events could limit the market moves for rest of the day but positive outcome from NAFTA could help the commodity currencies to recover some of their losses. However, pessimism at China and Sino-US trade front could keep troubling the Aussie, Kiwi and Loonie traders. Moreover, political pessimism for Mr. Trump, after two of his close aides pleaded guilty on various counts during last-week, might offer additional weakness to the US Dollar but market consensus for Fed’s rate-hike could save the greenback from plunging.

For EU & UK, leaders at both the economies are trying to improve their global relations and upbeat results of their efforts could drive both the currencies, namely EUR & GBP, towards north. Though, Brexit and migration problems at EU, coupled with Mr. Trump’s less favor for Germany, seem big barriers for these currencies to tackle.

Technical Talk

In spite of its bounce off the 100-day SMA, the USDCAD couldn’t challenge two-month old descending TL resistance, at 1.3130, which in-turn highlights the importance of 1.2990 SMA figure. In case the pair drops beneath the 1.2990, the 1.2915 and the 200-day SMA level of 1.2840 are likely following numbers to appear on the chart while 1.3100 may restrict the pair’s nearby upside before fueling it to 1.3130 trend-line barrier. Further, the USDCHF also needs to surpass adjacent trend-line, at 0.9855, breaking which 0.9870 & 0.9900 can become buyer’s favorite otherwise chances of its drop to 0.9800 & 0.9780 can’t be denied. At last, the EURJPY’s failure to surpass 129.60-65 resistance-confluence indicates its pullback to 128.85-80 & 128.50-40 supports with an upside break of 129.65 opening door for the quote’s rise to 130.40 & 131.10-15 resistances.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 28 – August – 2018

Hello Traders,

Even if British holiday suppressed market volumes on Monday, a successful trade-deal between Mexico and the U.S. triggered risk-on sentiments at the start of week. The deal within two of the NAFTA’s three-party team is likely to push Canada, the remaining one, towards joining the trade-terms and ease some of the trade-war concerns. Additionally, confirmation from White House officials that Mr. Trump had positive telephonic conversations with the leaders of Germany & Canada also strengthened investor optimism that dimmed the USD’s safe-haven appeal. However, this doesn’t help recede the fears of Sino-US tussles as U.S. Commerce Department identified subsidies on Chinese steel-wheels and are planning to levy tariffs on the same. Furthermore, the U.S. President Donald Trump also said that it’s not the right time to talk with China whereas Turkish policymakers struggled to gather support from rest of the world leaders to conquer US sanctions.

Not only USD but the JPY also had to extend its declines due to the rush towards riskier assets but the commodity-linked currencies, like AUD, NZD & CAD, and the Crude prices benefited from trade optimism. It should also be noted that EUR took advantage of upbeat German IFO Business Climate Index to mark a positive daily closing while the GBP and the Gold gained on the greenback’s dip.

Having witnessed welcome news from trade-front after a long time during yesterday, investor sentiment again favored the US Dollar at early Tuesday on speculations that Canada might not easily accept the U.S. terms and Mr. Trump could use additional force to hurt China, Iran & Turkey. Hence, the commodity-currencies, GBP & JPY remained weak against the USD but the EUR managed to remain strong on news of Germany’s ability to please Mr. Trump for future trade-ties.

Looking forward, British traders are ready to join the markets after long weekend but have no major economics from home to watch; though, US Goods Trade Balance, CB Consumer Confidence and Richmond Manufacturing Index are some of the stats that could entertain momentum traders for rest of the day.

With the U.S. Goods Trade Balance likely to show higher deficit figure of -68.6B against -67.9B, Mr. Trump may continue on his harsh stand against China and the same could hurt the commodity basket. However, soft outcomes of the CB Consumer Confidence and Richmond Manufacturing Index, to 126.6 and 18 from 127.4 & 20 respectively, may help the ex-USD majors to maintain their latest strength.

At the political front, Canadian Foreign Minister is expected to visit Washington for trade talks today and development concerning the same could affect global risk-sentiments. Moreover, White House announcements for additional tariffs on China’s steel wheels and retaliating comments from Iran & Turkey might also infuse volatility.

Hence, even if the recent trade optimism weighed on the USD, there still are some stats and news that can help the greenback recover some of its losses and offer busy trading sessions.

Technical Talk

GBPUSD struggles in a short-term symmetrical triangle formation between the 1.2910 and the 1.2840 with comparative weakness of the Pound indicating brighter chances for the pair’s drop to 1.2790 if 1.2840 is breached. In case prices surpass the 1.2910 resistance, the 1.2975 becomes an upcoming level on the chart. For AUDUSD traders, pair’s failure to conquer nearby resistance-line, at 0.7345, seems dragging it to 0.7290 and then to the 0.7250 with 0.7380 being follow-on resistance to watch past-0.7345 break. On the other hand, the EURCHF’s successful break of adjacent TL could help it visit the 1.1490 but might find it hard to conquer the 1.1530 resistance-confluence, including 50-day SMA & descending TL. Alternatively, the 1.1400 and the 1.1365-60 horizontal-area may limit the pair’s downside.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 31 – August – 2018

Hello Traders,

Having witnessed sustained selling pressure in last few sessions, the US Dollar Index (I.USDX) finally recovered some of its latest losses on Thursday due to its safe-haven appeal as comments from Mr. Trump reignited trade-war fears between world’s two largest economies. On yesterday, the U.S. President Donald Trump threatened to announce fresh tariffs on $200 billion worth of Chinese goods as soon as next week in addition to criticizing China’s role as a currency manipulator while communicating his readiness to exit WTO if the global trade organization fails to respect American policies. While USD was rising on risk-off sentiment, the JPY also justified its safe-asset status but the Gold couldn’t enjoy that liberty because of the greenback’s strength. Not only Mr. Trump’s comments but Italy’s spending spree and plunge in Asian currencies, together with Brexit pessimism, also played their roles in making the US Dollar a market favorite. Due to this, EUR, GBP & commodity-linked currencies, like AUD, NZD & CAD, had to take a halt from their recent surges but the Crude seemed less affected of those speculations as looming sanctions on Iran, depleting output at Venezuela and shrinking US inventories pleased energy traders.

In spite of registering an upbeat close the previous day, US Dollar couldn’t extend its surge during early Friday with surprise hike in China’s official Manufacturing & Non-Manufacturing PMIs showing policymakers’ ability to make the dragon nation great despite trade-tussles. However, positive comments from the NAFTA discussion between US & Canada, investors’ worries relating to Brexit & Italian actions, strong US fundamentals and Mr. Trump’s reputation of taking bold moves kept limiting the greenback’s declines.

Talking about Friday, the UK & the EU Brexit negotiators are up for a meeting again to mark an improvement in talks while US & Canadian policymakers will also meet to give a final touch to NAFTA talks that they aim for complete soon. At the economic front, Flash reading of EU CPI & US Chicago PMI are some other catalysts that’s left for playing their roles.

While EU CPI may keep portraying rose picture of EU economy by being unchanged at 2.1%, the US Chicago PMI might fail to provide noticeable support to the USD as it bears the consensus of marking 63.0 figure versus 65.5 prior. In case of other factors, threat from US President and progress in NAFTA talks can continue being strong push to the greenback specially when EU & UK discussing aren’t that positive. Moreover, Asian currencies are also bearing the burden of Mr. Trump harsh attitude towards Turkey, Iran and China whereas expected decline in future energy demand could trigger the Crude’s pullback.

As Sino-US trade relations are less expected to be cordial and rest of the economies are also facing tough time, developments on the US policies and comments from leaders, coupled with second-tier stats, could offer a busy Friday.

Technical Talk

EURUSD’s recent U-turn off the 1.1650 support isn’t a sign of its strength as 1.1750 & 1.1790-1.1800 barriers are still left pending to conquer, which in-turn signal brighter chances for the pair’s dip to 1.1600 & 1.1570 past-1.1650 break. Further, having breached fortnight old ascending trend-line, the NZDUSD may revisit the 0.6600 & 0.6540 rest-points unless it surpasses the 0.6670 and the 0.6725 resistances. Additionally, GBPAUD may find it hard to extend latest recovery as the 1.7955-65 horizontal-region stands tall & tough. As a result, pair’s pullback to the 1.7900, the 1.7850 and then to the 100-day SMA level of 1.7800 can be expected. However, quote’s D1 close beyond can avail the 1.8000 round-figure as an intermediate halt to its rally towards the 1.8070 and to the 1.8160-70 resistance-area.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 03 – September – 2018

Hello Traders,

In spite of registering upbeat data-points and receiving good safe-haven support during late-week, the US Dollar Index (I.USDX) flashed third consecutive weekly decline as optimism surrounding global trade-talks dragged the greenback heavily downwards at the start of last-week. While US President Donald Trump’s threat to levy extra tariffs on $200 billion Chinese goods couldn’t help the USD mark a positive weekly closing, the same news badly hurt the commodity-currencies, namely AUD, NZD & CAD, wherein the Canadian Dollar has additional bad news when US-Canada NAFTA talks stalled. In case of the EUR, Italy’s spending spree and downbeat German numbers dragged the regional currency down but the GBP surged on positive comments from Brexit policymakers. Further, the JPY benefited from the US Dollar’s weakness and the not the Gold whereas Crude prices benefited from decline in US inventory levels and worries concerning supply-crunch.

Having recovered some of its losses based on speculations concerning Sino-US trade-war, the US Dollar couldn’t hold its strength for long as Monday’s Labor Day holiday and positive PMIs from Japan dimmed the U.S. currency’s allure. Though, AUD, NZD & CAD couldn’t enjoy the same as sluggish print of China’s Caixin Manufacturing PMI and Australian Retail Sales kept highlighting fundamental weakness for export-oriented economies. Additionally, GBP also shed some of its latest gains as British Manufacturing PMI tested two-years’ low.

With the U.S. markets shut for a day and majority of scheduled data-points already announced, investors might want to concentrate more on the political aspect. Among them UK and Asian politics could grab the limelight as British policymakers will soon return from their summer vacations with criticism for present government with currencies of Turkey and Iran witnessing fresh selling pressure after their failure to confront Mr. Trump.

In case of the UK, major labor leaders and some among the PM Theresa May’s own supports are going public to show their agitation against Mrs. May’s inability to escalate Brexit talks. As a result, there might be a voting session in UK parliament on the same sometime during this week wherein the PM has to save her position in addition to securing good support for her plans.

On the other hand, the Turkish Lira and Iranian Rial are again declining as their central-banks’ efforts to support the currency fell short of political leaders’ feud. In addition to this, US President Donald Trump’s tough stand against China, Canada and some other countries not respecting his trade-terms continued being a tough challenge for respective Asian currencies.

Hence, while political framework is likely to heat soon, absence of major data-points may push investors to react more on developments concerning any of them.

Technical Talk

Having failed to justify its brief stay beyond 50-day SMA, the USDJPY presently aims to re-test the 110.65, breaking which 110.10 & 110.00 may appear on the chart while an upside break of 111.20 SMA figure may escalate the pair towards 111.50 & 111.85. Alternatively, the USDCAD seems targeting 1.3100 round-figure and the 1.3170 resistances unless trading above 1.3000, which if broken may drag the quote to 1.2940. At last, EURGBP’s U-turn from more than two-month old ascending TL, at 0.8940 now, helps it to look for 0.9000 & 0.9030 numbers to north whereas a dip beneath 0.8940 may highlight 50-day SMA level of 0.8910 & 0.8900 mark as important supports.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 04 – September – 2018

Hello Traders,

With the growing criticism of Mr. Trump’s hard stand against Canadian inclusion to NAFTA, the US Dollar Index (I.USDX) had to post a negative daily closing on Monday despite having Labor Day holiday at the U.S. As a result, EUR, JPY & Gold took advantage of the greenback’s decline by registering positive D1 close but GBP couldn’t avoid EU & some of the UK policymakers’ refrain to respect British PM’s Brexit proposal. Moving on, the AUD also benefited from the USD’s dip while NZD & CAD failed to recover on Sino-US trade-tussles. Moreover, the Crude prices managed to please buyers as depleting exports from Iran and hurricane threat at Gulf of Mexico favored the energy demand.

During early Tuesday, investors waited for clues from developed nations in order to determine rest of the day’s moves but turmoil at emerging market economies, mainly from Turkey & Argentina, rejuvenated the US Dollar’s strength. The Crude stretched its latest advances forward whereas JPY & Gold had to bear the burden of greenback’s upswing. Additionally, EUR GBP dropped on Brexit pessimism and sluggish data-points at home while NZD & CAD kept trading southwards as Mr. Trump’s protectionism is likely taking a step forward to punish China even without not much support at home. However, AUD surged after RBA signaled recent declines in the Aussie to be positive for the export-oriented economy while making no change to its present monetary policies.

After the RBA played its role, the UK Construction PMI, BoE Governor’s testimony on Inflation report, US ISM Manufacturing PMI and Canadian Manufacturing PMI are still left to welcome American traders when they come back from long-weekend. In addition to this, Turkish central-bank vowed to reshape its monetary policy soon and policymakers from Argentina are also rolling their sleeves up to fetch the economy out of woods whereas US-Canada talks on NAFTA will resume on Wednesday and the British leaders could keep speaking against Mrs. May’s Brexit plans in parliament.

As far as data-points are concerned, the UK Construction PMI may add weakness into the GBP with 54.9 mark against 55.8 prior and the U.S. ISM Manufacturing PMI could also follow the suit with 57.6 figure versus 58.1 earlier while Canadian Manufacturing might soften from 56.9 previous. In case of Mr. Carney’s inflation hearings, the BoE Governor is less likely to maintain his hawkish mood considering Brexit pessimism and recent weakness in UK details but could justify why the central-bank hiked benchmark interest rates with some economic rosy picture.

Given the slew of data-points likely portraying weakness in PMIs, respective currencies might not benefit from them but fears of trade-war, Brexit and political pessimism at Turkey & Argentina may support the USD on its first active day of the week.

Technical Talk

Break of 1.2900 seems dragging the GBPUSD towards 1.2790 and then to the 1.2730 but an upside clearance of 1.2900 still needs to conquer the 1.2935-40 area before aiming the 1.3000 round-figure. Further, the AUDUSD’s post-RBA rise couldn’t surpass the 0.7240 resistance, which in-turn signal brighter chances for the pair’s pullback to 0.7160 & 0.7140 rest-points while uptick beyond 0.7240 may help the quote to challenge 0.7280-85 resistance-region. Moving on, the AUDNZD also rose above 50-day SMA level of 1.0935 and may target the 1.0990-1.1000 and 1.1060 resistances if it can hold the recovery, if not then 1.0890 and the 1.0860-55 support-confluence could threaten the sellers.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 05 – September – 2018

Hello Traders,

In addition to strong ISM Manufacturing PMI, trade conflict between the U.S. and China helped US Dollar Index (I.USDX) to register noticeable gains on Tuesday. However, the CAD had to decline on sluggish PMI figure whereas EUR couldn’t confront the greenback’s strength at the time when Italy is causing problems for EU policymakers. The GBP also dropped even if BoE Governor showed readiness to remain as central-bank chief post this term mainly due to Mr. Carney’s concern for Brexit and sluggish UK Construction PMI. Further, the AUD failed to hold earlier gains earned through upbeat RBA statement while the NZD declined on global trade pessimism. Moving on, the JPY and Gold behaving like others and had to respect the USD’s strength whereas Crude also plunged after threat of tropical storm on U.S. Gulf coast production receded.

At the start of Wednesday, upbeat Australian GDP figure helped the Aussie to recover some of its losses but those moves couldn’t prevail for long as USD maintained its safe-haven status ahead of US-Canada NAFTA talks and Canadian PM has already denied respecting US demands even if it has to witness the no deal scenario. On the other hand, public comment period concerning US President’s fresh tariffs on $200 billion Chinese goods will end on Thursday and Mr. Trump seems intact on his previous view to slap the levies as soon as the period ends. Moreover, South Korean envoys reached North Korea to bridge the latest gap between hermit kingdom and the U.S. when it comes to denuclearization. Hence, political waves has already started fueling the greenback during early-day trading sessions.

In case of economics, UK Services PMI and Trade Balance figures from US & Canada, together with monetary policy meeting by the Bank of Canada (BoC) are likely to entertain momentum traders. The UK Services PMI, crucial to British GDP, is bearing consensus of flashing 53.9 mark against 53.5 while US trade deficit may widen to -50.2B from -46.3B and the so does the Canadian trade balance number which is expected to shrink to -50.2B from -46.3B earlier. Additionally, the BOC isn’t expected to alter its present monetary policy after increasing benchmark interest-rates twice in the present year. However, threat to global trade system and recently weaker data-points may affect the Loonie in a negative way.

Other than what’s already mentioned above EU & UK policymakers may also contribute to market volatility as both of them are still far from reaching any solution to Brexit deals and the British leaders have started showing dissatisfaction with Theresa May’s efforts as UK PM. Also, Geo-political news relating to Turkey, Iran & Argentina could keep marking their presence on the analysts radar.

Given the presence of active economic calendar, global trade and political moves surrounding US & various influential economies, financial markets are up for witnessing another volatile day and the same could help the USD to witness more safe-haven support. However, questions on Trump administration’s alleged role in Russian meddling in 2016 Presidential election, coupled with Mr. President’s refrain to respect other policymakers’ say on global trade issues, might confine the currencies upside.

Technical Talks

Successful clearance of 1.3095-3100 resistance-confluence, comprising 50-day SMA & ten-week long descending TL indicates brighter chances for the USDCAD’s further upside towards 1.3265-70 and then to the 1.3330 but its dip beneath the 1.3160 might not hesitate flashing 1.3100 on the chart. On the other hand, the USDCHF again aims to confront the 200-day SMA level of 0.9780, breaking which it can rise to 0.9820 & 0.865-70 resistances while failure to surpass the SMA barrier could fetch the quote to 0.9700 and the 0.9680 supports. In case of the CADJPY, the pair needs to close beyond 84.80, comprising 100-day SMA, in order to aim for 200-day SMA level of 85.45 and the 86.50-55 TL resistance otherwise its pullback to 84.20 support-line and to the 83.50 can’t be denied.

Have a nice trading-day ……

[FxAnil]

Weekly Fundamental Dose: 06 – September – 2018

Hello Traders,

While emerging market rout and sluggish trade-talks have been playing their roles off-late, not to forget about Japanese earth quake and Brexit, end of public comment period on fresh U.S. tariff for the $200 billion worth of Chinese goods as well as monthly reading of US employment stats are likely to dominate market sentiment for rest of the week. It should also be noted that political developments at Turkey, Argentina & Iran might become additional burden for analysts to observe.

Before we flash lights on the aforementioned details/events, it would be better to know what’s recently happened in the financial world.

It Was Another Bad Week For The US Dollar

In spite of witnessing safe-haven support by the late-week, mainly due to stalled NAFTA talks between Canada & US, the US Dollar Index (I.USDX) couldn’t ignore third consecutive weekly negative closing as welcome results of US-Mexico trade deal triggered risk-on sentiment that ignored upbeat GDP number from the world’s largest economy. Even if the US Dollar failed to strengthen, the EUR couldn’t take advantage of the same as Italy’s spending spree and disappointing German numbers kept investors away from the regional currency. However, the GBP surged as speculations mounted that UK will have a deal with EU by Brexit while the JPY also registered gains due to greenback’s decline.

Moreover, AUD, NZD & CAD kept trading southwards as China’s refrain to respect American demands as a part of trade-deal kept threatening commodity-linked currencies. Additionally, the Crude prices extended previous recovery as depleting US inventories and upcoming sanctions on Iran highlighted energy supply crunch.

Off-Calendar Events Gain Investor Attention

Having registered another weekly loss, the US Dollar started recovering during early week as pessimism surrounding Trump’s inability to gel well with Canada & China on trade kept supporting the safe-haven demands of US Dollar. However, latest updates that White House is all set to sign trade deal with South Korea and is also progressing on NAFTA talks with Canada dimmed the greenback’s allure. The EUR & the GBP, which previously declined due to Brexit negativity and disappointing data-points, recovered some of their losses after Britain and Germany seems agreeing to have a rough plan by the Brexit that could also ease the pressure off UK PM Theresa May. Though, the scenario hasn’t changed for AUD, NZD & CAD, even after witnessing upbeat AU GDP, as Sino-US trade-tussles are expected to have a big blow from the U.S. President Donald Trump in the form of fresh tariffs on $200 billion Chinese goods. The traditional safe-havens, like JPY & Gold, were in red till Japan witnessed heavy earthquake whereas Crude prices are likely realizing the threat to future demand from global trade-wars.

At the political front, Argentina & Turkey struggles to assure investors that their respective economies will soon recover after taking unconventional measures to support sluggish currencies. Also, the Iranian leaders stretched their hands forward to some Asian nations to help confront US sanctions while South Korea is trying to bridge the gap between US & North Korea as White House seems little disappointed with progress made by hermit kingdom on denuclearization.

Hence, even if majority of headline economic details are already out and loud, global investors focused more on the off-calendar events to determine near-term market moves.

The U.S. Will Be In Front & Center

With most of the scheduled data-points already out and loud, traders would now closely examine developments from US, be it monthly jobs report or trade-talks, in order to determine near-term market moves.

Starting with the trade front, public comment period for fresh tariffs on China is about to close on Thursday and Mr. Trump previously showed readiness to go ahead by punishing dragon nations with extra tariffs on $200 billion worth of goods. Though, the situation is a bit improving in case of Canada as policymakers are likely to close NAFTA talks soon with positive results and US-Mexico has already agreed to the crucial deal last-week. Further, the U.S. President has also said he is ready to sign a formal trade deal with South Korea, which was agreed in March, during United Nations General Assembly this month. Hence, while Sino-US trade tussles are likely to keep highlighting the USD’s safe-haven appeal, expected deal between the US-Canada and US-South Korea could ease some pressure off the global trade watchers.

Other than trade-deals, the Brexit front has also started flashing positive signals as Germany and Britain are finally up for accepting rough explanation of EU-UK relations post-Brexit before having a detailed plan. As a result, UK PM Theresa May might find it easy to maintain her position amid growing challenges from British policymakers that the leader has failed them on Brexit. Moreover, Turkey & Argentina are also witnessing a halt in their respective currencies’ plunge due to their hard efforts to get helps from international lenders and from monetary policy.

Coming to the data-front, Thursday’s US ADP Non-Farm Employment Change, the earlier signal for Friday’s NFP, is likely to challenge the USD bulls with 195K forecast against 219K prior while the expected contraction in Factory Orders to -0.5% from +0.7%. However, the ISM Non-Manufacturing PMI may soothe some pains of the USD optimists if matching 56.8 consensus compared to 55.7 prior. On Friday, employment details from Canada and the U.S. may dominate investor minds wherein the Canadian Employment Change is expected to register +5.1K mark against 54.1K earlier with 5.9% Unemployment Rate versus 5.8% previous reading. In case of US Jobs report, the popular Non-farm Payrolls (NFP) flashed 157K mark and is expected to recover towards 193K this week and the Unemployment Rate of may dip to 3.8% from 3.9% whereas Average Earnings growth could also soften to 0.2% from 0.3%.

To sum up, global trade fears are likely to recede if Canada manages to secure NAFTA with the U.S. and Mr. Trump goes ahead with his plans with South Korea. However, announcement of fresh tariffs on China could continue threatening global commodity optimists and may highlight the safe-haven demands of the USD. Additionally, mixed US jobs report could limit the greenback’s gains and might keep inflating the importance of this month’s FOMC wherein the Fed policymakers are expected to announce another rate-hike.

On the other hand, progress on Brexit can help EUR & GBP to recover some of their latest losses while improvements at Turkey & Argentina can hurt the JPY & Gold but pessimism concerning Asian economies may keep supporting risk-off.

Technical Analysis

EURUSD’s bounce off the 1.1530-40 might help it to aim for the 1.1740-45 and the 1.1790 but a downside break of 1.1530 could drag prices to the 1.1480 & 1.1430 rest-points. The GBPUSD struggles in a range between the 1.2785-2800 and the 1.3000-3010 with brighter chances of the pair’s downtick to 1.2655 on the break of 1.2785 whereas 1.3100 could please buyers past-1.3010. On the other hand, the USDJPY needs to conquer 111.75 and the 112.15-20 in order to justify its strength otherwise its pullback to 111.10 and the 110.65-60 can’t be denied while USDCAD’s sustained break of 1.3090-1.3100 enables it to target the 1.3255-65 and the 1.3330 with 1.3000 & 1.2910 being follow-on levels to watch if 1.3090 is smashed. Moving on, the AUDUSD has 0.7140 & 0.7090 as important supports should the quote keep trading southwards with 0.7235-40 & 0.7300 acting as immediate resistances. At the end, the NZDUSD continues signaling its drop to 0.6490-85 and the 0.6460 unless clearing the 0.6620 & 0.6690 resistances.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 07 – September – 2018

Hello Traders,

With lesser progress on NAFTA talks and sluggish data-points threatening the Federal Reserve’s future rate-hikes, the US Dollar Index (I.USDX) marked another negative daily closing on Thursday but the EUR couldn’t benefit from it due to contracting German Factory Orders and political pessimism at Italy. Though, GBP managed to take advantage of the USD’s drop as Brexit talks might move faster with Germany’s readiness to respect UK’s raw plans. Alike GBP, the AUD & CAD also recovered some of their latest losses based on the USD’s declines but the NZD remained unchanged on RBNZ Governor’s comments favoring steady monetary policy. On the other hand, the JPY & the Gold surged as emerging market rout helped the traditional safe-havens whereas Crude dropped even after witnessing more than expected shrink in US inventories because of speculations that trade-protectionism will weigh on energy demand.

During early Friday, the greenback extended its recent downturn as monthly jobs report aren’t expected to flash upbeat numbers while the clash between US & Canada might let Mexico only NAFTA be reality. Moreover, public comment period on fresh tariffs for $200 billion in Chinese imports came to close on Thursday with leading American technology companies and retailers trying to convince Mr. Trump to dump his idea. As a result, pessimism surrounding trade-tussles and likely soft economics played their roles during early sessions to disappoint USD Bulls.

Not only U.S. but the Canada will also release monthly prints of its employment figures and the same are also bearing downbeat consensus. Forecasts suggest the US NFP to post 191K mark against 157K prior and the Unemployment Rate to dip to 3.8% from 3.9% with Average Earnings growth likely softening to 0.2% from 0.3%. In case of Canada, the Employment Change could mark 5.1K figure versus 54.1K and the Unemployment Rate increasing to 5.9% from 5.8%.

Given the mixed prints of US data-points, near-term moves of the USD might depend more on how Trump administration respects Canadian issues while discussing NAFTA and whether the U.S. President go ahead with his tariff plan on $200 billion worth of Chinese goods. It should also be noted Donald Trump has recently signaled that he might start discussing trade-ties with Japan, which in-turn added further negativity into the trade front.

While jobs report isn’t expected to provide any big relief to the USD, failure of NAFTA talks and Trump’s go ahead with Chinese tariffs could make the greenback even more weaker at the time when technology shares are declining based on expected dip in future demand. However, the U.S. currency’s safe-haven might play its role in that case and may confine its plunge.

In addition to trade-talks and employment numbers, the Brexit and emerging market rout would also offer important facts/statements to constitute a busy Friday. As a result, safe-havens might become market favorites whereas commodities and related currencies could witness profit-booking.

Technical Talk

EURUSD’s recovery from 1.1530-25 horizontal-region needs to surpass the 1.1665 TL in order to aim for the 1.1730 otherwise the pair’s pullback to 1.1590 and the 1.1530-25 can’t be denied. On the contrary, the NZDUSD’s failure to surpass 0.6615-20 horizontal-region signals brighter chances of its drop to the 0.6560 and the 0.6525 supports while an upside clearance of 0.6620 can help the quote to target 0.6670 and the 0.6695-0.6700 resistances. Moving on, the CHFJPY also takes U-turn from immediate trend-line support and may revisit the 114.90-95 resistance, breaking which 115.30 and the 61.8% FE level of 115.55 could mark their presence on the chart while the price-dip beneath 114.45 can flash the 113.95 level as quote.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 10 – September – 2018

Hello Traders,

Friday’s strong US employment report and Mr. Trump’s readiness to slap tariffs on virtually all Chinese imports acted like a savior for the US Dollar Index (I.USDX) as the greenback was initially declining on sluggish data-points and trade-related optimism but managed to post first positive weekly closing in previous four at the end. With this, the EUR magnified its losses occurred due to Italy’s spending spree and weaker German stats but the GBP registered profits with EU & UK both trying hard to avoid no deal Brexit and the British Services PMI beating downbeat estimates. In case of commodity-currencies, CAD had to bear the burden of Canada’s inability to please Trump administration for NAFTA whereas AUD & NZD plunged on pessimism emanating from China. Moving on, the JPY moved between gains & losses because of rising USD & overall safe-haven demand but the Gold couldn’t avoid negative weekly closing. For the energy traders, emerging market rout and speculations that trade wars could harm fuel demand dragged the Crude prices down.

While upbeat wage growth has heightened concerns for two more rate-hikes from the Fed, Mr. Trump’s threat for China and less progress on NAFTA talks with Canada kept entertaining the USD buyers at the start of present week. However, the Crude recovered some of its earlier losses on EIA’s upbeat forecast & rejuvenated risks from Iranian sanctions. On the other hand, the EUR also witnessed short-covering after Italian policymaker said the nation will respect EU norms while announcing public spending and there are signs that EU’s Brexit negotiators may finally have some solution for Irish border issue that in-turn helped the GBP to remain strong. It should also be noted that AUD & NZD managed to stop their south-run but the CAD couldn’t deny sellers.

Given the trade-war fears and recently welcome US employment numbers kicked start the week, early-day releases of China’s CPI & PPI entertained momentum traders as CPI marked more than forecast & earlier figure while PPI met consensus of lesser that prior reading. Additionally, the Japan’s final reading of Q2 2018 GDP also pleased the JPY bulls and help the currency to welcome Monday in gains.

Looking forward, monthly reading of the UK GDP, Manufacturing Production, Industrial Production & Goods Trade Balance could make the market players busy together with global trade developments.

While UK GDP may flash 0.2% mark against 0.1%, the Manufacturing & Industrial Production are both likely to register 0.2% growth compared to 0.4% prior for each. Also, the Goods Trade Balance may show higher deficit figure of -11.7B versus -11.4B. Hence, while GDP and upbeat sentiment at Brexit could help the GBP, Production numbers & trade balance may limit the Pound’s upside.

In case of trade-war fears, announcements from White House relating to NAFTA progress & what actions will be taken in case of Chinese trade will be awaited and may cause volatility on the US Dollar. Hence, safe-havens, like JPY and USD, could benefit from such market pessimism but the commodity-liked currencies may have to remain under pressure.

Technical Talk

GBPUSD’s sustained trading below 50-day SMA signals brighter chances for the pair’s further drop to 1.2880 and then to the 1.2800 while 1.2960 can offer immediate resistance before highlighting the 1.3000 round-figure, including 50-day SMA. Further, AUDUSD’s downturn beneath 0.7135 can avail 0.7030 and the 0.7000 mark as rests whereas an upside break of 0.7135 may have 0.7165-70 numbers to please counter-trend traders. At the end, EURCAD’s latest recovery might entertain the buyers with 1.5275 but the 1.5360-70 resistance-confluence, comprising 200-day SMA & medium-term TL, could limit the pair’s additional rise. On the contrary, a D1 close below 50-day SMA level of 1.5195 can drag the quote to 1.5160 and the 1.5100 support-levels.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 11 – September – 2018

Hello Traders,

Not only Mr. Trump’s surprise silence on Chinese tariffs but upbeat sentiment at Brexit and Italy’s readiness to respect EU spending norms also contributed towards dragging the US Dollar Index (I.USDX) down on Monday. While good news from Italy helped the EUR to witness positive start of the week, welcome GDP & Trade Balance numbers became additional positives for the GBP, other than EU Brexit negotiator’s comments favoring likelihood of a deal with the Britain. However, the JPY couldn’t manage to enjoy plausible GDP figures as halt in Sino-US trade-war and North Korea’s readiness to have another summit with the U.S. to dissolve latest misunderstandings on denuclearization cut the Yen’s safe-haven demand but Gold managed to shine on the USD’s decline. At the commodity front, Crude prices couldn’t justify threat for upcoming US sanctions on Iran as Saudi Arabia & Russia increase their output to balance global demand-supply. Moreover, the AUD and the CAD benefited from China’s CPI but NZD declined on worries concerning RBNZ’s recently dovish remarks.

During early Tuesday, China’s comments that the nation will respond to US tariffs with retaliatory measures couldn’t rejuvenate the US-China trade-war speculations as there was no immediate reply from White House which was busy preparing for US-North Korea summit. Additionally, positive sentiment that Canada will use its final efforts to please US on NAFTA talks during Tuesday and threat of Hurricane Florence affecting the Colonial Pipeline entertained market players. As a result, slump in Australian NAB Business Confidence couldn’t affect the optimism that helped commodity-linked currencies, EUR & GBP while dragging the JPY southwards.

While NAFTA talks and US President Donald Trump’s response to China’s recent statement is likely generating headlines for the day, monthly readings of UK employment stats and EU ZEW Economic Sentiment numbers could offer additional information to determine near-term market moves. Additionally, developments at Brexit front could also cater the momentum traders.

In case of data-points, the British Claimant Count Change may rise to 6.9K from 6.2K while the Average Earnings and Unemployment Rate could remain unchanged at 2.4% and 4.0% respectively. For the ZEW Economic Sentiment, consensus indicate a -10.9 mark for the EU against -11.1 prior and the -13.5 for the Germany compared to -13.7 earlier.

While UK employment report is less likely to offer additional strength to the GBP, improvements in EU stats may help the regional currency to remain strong for some more time. However, it all depends upon how well Trump administration progresses on NAFTA talks with Canada and whether they take any action against the China, as promised last-week, or not. It should also be noted that comments from EU & UK policymakers regarding Brexit can add volatility into the EUR & GBP.

Should Mr. Trump go ahead with this tariff plans of $267 billion worth of Chinese goods and refrain to respect Canadian requests, the US Dollar’s safe-haven appeal could regain market attention and commodity front will be badly hit. With this, the EUR & GBP may also have to kneel in front of the greenback while JPY & Gold could find it hard to confront stronger US Dollar.

Technical Talks

Notwithstanding the EURUSD’s repeated reversals from 1.1530-25 horizontal-support, an immediate descending TL, at 1.1635 now, may threaten the pair’s latest recovery, which if broken could escalate the quote to 1.1665 and the 1.1700 resistances while 1.1560 might offer intermediate halt during the pair’s pullback prior to highlighting 1.1530-25 for one more time. USDJPY also aims to confront the 111.70 TL resistance that holds the gate for pair’s rise in direction to 112.15-20 and the 112.65-70 but failure to surpass the trend-line can drag prices to 111.00 & 110.65 rest-points. Additionally, EURJPY has to clear the short-term descending trend-channel resistance, at 129.85, in order to challenge the 130.55 TL else its profit-booking to 129.30 and the 128.75 can’t be denied.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 12 – September – 2018

Hello Traders,

Comments from Canadian policymakers that the nation may relinquish some of its hard stand on dairy products while discussing NAFTA with the U.S. and North Korea’s peace push, coupled with upbeat data-points from EU & UK, dragged the US Dollar Index (I.USDX) down again on Tuesday. As a result, EUR & GBP managed to extend their latest recoveries but JPY couldn’t stop declining while the Gold benefited from greenback’s drop. Moving on, Crude prices surged as depleting stockpile numbers from API and threat of hurricane towards U.S. east coast signaled energy supply crunch, which in-turn helped the CAD, whereas the AUD & the NZD took a break from their south-run on absence of any fresh tariff threats from the U.S.

Even if receding trade-war concerns boosted market sentiment on Tuesday, China’s readiness to approach WTO in order to take approval to retaliate against Mr. Trump trade protectionism and the U.S. President’s comments that they are taking a tough stance against China rejuvenated risk-off mood during early Wednesday. On the other hand, separate news suggested that almost 50% of Theresa May’s own party members dislike her Brexit deals and might show their dissent when they will have to approve that deal in parliament. Moreover, Japan and China seem joining hands after years of rough relations and the same could help China to have a background support while countering Mr. Trump on trade-tariffs.

With the latest salvo of news indicating a tough show of US-China trade-tussles and Brexit worries, the US Dollar regained safe-haven appeal around earlier sessions and the commodity-linked currencies, like AUD, NZD & CAD, had to kneel in front of sellers. Though, the Crude maintained its strength on Hurricane relating threats and JPY also recovered some losses on optimism that Japanese PM could help the economy with his persuasive nature.

While on-going NAFTA talks and developments at Sino-US trade tussles could keep entertaining momentum traders for rest of the Wednesday, political pessimism at UK and comments from EU President concerning the Brexit might become crucial to observe. With this, lack of big events of economic calendar, that has only US PPI & Crude inventory details to release, might not be felt much.

In case of scheduled events, the US PPI may portray strong inflation outlook if posting 0.2% growth against 0.0% MoM but soft figure on yearly basis, to 3.2% from 3.3%, could dent the optimism surrounding tomorrow’s headline CPI. Also, the weekly release of official US crude inventories may also disappoint energy Bulls if matching the -1.3M forecast versus -4.3M prior.

Hence, while on-going uncertainty for Brexit, NAFTA and Sino-US trade relations are likely to take the center-stage of market happenings and can trigger the USD’s advance, fewer stats on the calendar might get less attention.

Technical Talks

Even after bouncing off the 100-day SMA, USDCAD needs to surpass the 50-day SMA level of 1.3090 in order to aim for the 1.3110 otherwise it pullback to the 100-day SMA level of 1.3040 and then to the 1.3000 round-figure can’t be denied. Further, the NZDUSD may find it hard to dip beneath 0.6500-0.6495 support-zone and could witness short-covering towards 0.6545 & 0.6570 but failure to respect the 0.6495 might not hesitate fetching the quote to 0.6460. At the end, the GBPJPY is likely to revisit the 144.30 and the 143.00 support-line unless breaking the 100-day SMA level of 145.90 and the immediate TL around 146.50.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 14 – September – 2018

Hello Traders,

Following a tech-based rally in U.S. equities and unexpectedly cool inflation numbers, not to forget receding fears of Sino-US trade-war, the US Dollar Index (I.USDX) extended its south-run on Thursday. With this, the EUR managed to ignore downward revision to growth forecast & took advantage of even a slightly hawkish tone of ECB President whereas the GBP surged on BoE’s upbeat economic assessment & news that EU & UK policymakers are close to finding solution on Irish border issue. Further, AUD & NZD benefited from US policymakers’ readiness to have a trade-talk with China but CAD couldn’t rise due to sluggish progress at US-Canadian NAFTA talks. Moving on, the JPY & the Gold witnessed profit-booking due to improvements at equity front while the Crude oil plunged after IEA identified trade protectionism to be a bigger threat to future energy demand.

While optimism that upcoming meet between world’s two largest economies may avoid full-fledged trade-war helped fueling investor sentiment recently, the U.S. President Donald Trump tweeted on Thursday that US is in no pressure to reach a trade deal with China and has upper hand in negotiation. As a result, threats concerning Sino-US trade-war rejuvenated during early Friday. However, upbeat release of China’s Industrial Production & Retail Sales helped commodity-linked currencies, like AUD, NZD & CAD, to remain strong. Adding to the show of US protectionism is White House policymakers’ readiness to levy second round of tariffs on Russia, the tougher one, due to its alleged role in U.K. nerve-agent attack.

Even if developments related to Sino-US trade-tussles, NAFTA & Brexit are likely to keep playing background music for market moves, latest softness in US headline inflation highlights the importance of today’s consumer-centric details, namely the Retail Sales and the Prelim UoM Consumer Sentiment.

Forecasts suggest a +0.4% growth of Retail Sales (MoM) against +0.5% prior with the Core Retail Sales expected to mark 0.5% expansion compared to 0.6% earlier rise. Additionally, the Preliminary UoM Consumer Sentiment can advance to 96.7 from 96.2. Hence, overall view of the scheduled consumer-centric numbers isn’t quite positive and may stretch the greenback’s south-run if posting weaker numbers.

At the trade & political front, Brexit may keep helping the GBP while NAFTA is a problem for the CAD and rejuvenated tensions of US-China trade-tussle could keep hurting the commodity-linked currencies. Though, the same can confine the US Dollar’s plunge due to its safe-haven appeal.

Technical Talk

Successful D1 close beyond 100-day SMA for the first-time since late-April signals EURUSD’s readiness to confront the 1.1745-60 resistance-region, which in-turn holds the door for a rally towards 1.1810 mark. However, quote’s dip beneath 100-day SMA level of 1.1675 can highlight the importance of 1.1610, comprising 50-day SMA. On the other hand, failure to surpass 200-day SMA again drags USDCHF to 0.9635-30 support-zone, breaking which 0.9570 may mark its presence on the chart whereas 0.9685 & 0.9715 could restrict the pair’s near-term upside. Moreover, the GBPCHF seems finding it hard to hold its recent recovery as seven-week old descending TL, at 1.2685, signals the pair’s drop to 1.2615 and the 1.2550-45 support-area. In case prices rise above 1.2685, the 1.2730 and the 1.2800 might become buyers’ favorites.

Have a nice trading-day ……

[Subhojit]

Hi ,

I am new to the forum. I have very little understanding of the fundamentals. Also , I live in India and hence cannot trade in major currency pairs . SO I trade in Commodities . Mostly base metals . USD’s movement affect the prices of metals and hence I try to follow some fundamentals for USD.

I am very impressed by your analysis and would like to learn more . It will be very helpful of you if you can specify a learning path for me keeping in mind that I will mostly trade in base metals.

Thanks in advance
Subhojit

[FxAnil]

Thanks for your kind word!

If you’re looking for a mentor than I feel myself a little suitable for this role. However, I can suggest you to read basics of commodity markets first and observe the fundamentals surrounding China in order to take few DEMO trades before going live.

[FxAnil]

Daily Fundamental Dose: 17 – September – 2018

Hello Traders,

With sluggish consumer-centric details at home questioning the Fed’s hawkish mood, the US Dollar Index (I.USDX) couldn’t avoid Trump administration’s readiness to restart trade discussions with China and registered a negative weekly closing. On the contrary, the EUR surged on welcome data-points and receding political pessimism at Italy whereas upbeat stats and positive signs of Brexit with deal helped the GBP to extend its recent recovery. Same is the case with commodity-linked currencies, namely AUD, NZD & CAD, where scheduled economics registered good numbers and expectations that Sino-US trade-war can be avoided triggered their short-covering rally. However, there was no respite for JPY & Gold as improvements in global risk-sentiment cut safe-haven demand. Moving on, the Crude managed to rise on depleting US stockpile, likely supply disruption due to hurricanes and upcoming sanctions on Iran.

While US Treasury Secretary’s push to restart talks with China took market attention off from trade-war concerns, Mr. Trump’s tweets that they are in no hurry and have upper hand in negotiation with Beijing matched news that the U.S. President asked his aides to go ahead with fresh tariffs on $200 billion worth of Chinese goods. As a result, investors again weighed on chances of full-fledged Sino-US trade-war, which in-turn helped the greenback to witness safe-haven buying around early Monday.

Not only rejuvenated trade-war fears but upcoming EU Final CPI and US Empire State Manufacturing Index are also likely to overtake Monday Blues. Forecasts suggest the EU Final CPI to remain unchanged at 2.0% mark but the Empire State Manufacturing Index could soften to 23.2 from 25.6. Moreover, EU-UK policymakers are also inclined to announce one Brexit summit soon to escalate the progress of British departure from the region.

As EU inflation is indicating brighter chances of the ECB’s monetary policy tightening, the EUR may continue extending its recent advances but surprise uptick in US manufacturing gauge might helped the USD to recover its latest losses and negatively hurt rest of the majors. Moreover, pessimism at trade front could also add weakness into the commodity-linked currencies and may trigger the Crude’s downturn. Though, the GBP might continue being strong on Brexit optimism unless any negative announcements concerning the same hurt UK currency.

Hence, with the Mr. Trump’s latest tariff threat to China joining hands with scheduled data-points from EU & US, Monday Blues are less likely to prevail for today.

Technical Talks

Having failed to clear the 112.15-20 horizontal-resistance, the USDJPY may decline towards 111.80-75 and the 111.40-35 but an upside clearance of 112.20 can propel the quote to 112.60-65 and the 113.20 north-side numbers. Further, USDCAD also needs to surpass the 1.3080 barrier in order to aim for the 1.3110 else its pullback to 1.3010 and the 1.2985 TL can’t be denied. At the end, the NZDJPY’s inability to surpass the 73.70-80 region indicates brighter chances for the pair’s dip to 73.00 and then to the 72.85 support-line whereas 74.15 & 74.40 trend-line could limit the pair’s advances past-73.80.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 18 – September – 2018

Hello Traders,

When four-month low of US Empire State Manufacturing number confronted with welcome progress on Brexit and upbeat EU Final CPI, the US Dollar Index (I.USDX) had to register a negative daily closing whereas EUR & GBP extended their recoveries. Commodity-linked currencies like AUD and NZD also benefited from the greenback’s weakness whereas JPY & Gold strengthened on Geo-political factors concerning trade-war, hurricanes and sanctions. However, the Canadian Dollar couldn’t enjoy USD’s decline as uncertainty surrounding NAFTA and decline in Crude prices, mainly due to demand crunch & oversupply expectations, disappointed Loonie traders.

Even if sluggish details failed to please US Dollar optimists at the week-start, comments from US President Donald Trump, after market close, rejuvenated the currency’s safe-haven appeal. Mr. Trump used his salvo against China and confirmed speculations that the U.S. will levy additional 10% tariffs on Chinese goods worth of $200 billion starting from September 24 and the rate would reach 25% by 2019. He also said that if China retaliates against the measure he’ll use the phase three measure of targeting another $267 billion of goods from the dragon nation.

As a reaction to America’s fresh protectionist measures, China is now thinking whether to accept the recent proposal from US to restart trade negotiations or not while some policymakers are already preparing replies for Mr. Trump. With this, early-Tuesday pleased USD buyers and negatively affected AUD, NZD & CAD whereas EUR & GBP remained under pressure ahead of Brexit summit. Adding to trade-war and Brexit, South Korean President, Moon Jae-in, is scheduled to meet his North Korean counterpart on Tuesday. During the three-day visit he’ll try convince Mr. Kim Jong-Un to progress on the terms agree in Singapore with Mr. Trump. However, Kim has his own demands of peace accord to satisfy before the hermit kingdom can produce time-table to denuclearization. It should also be noted that Canadian Foreign Minister Chrystia Freeland will also revisit Washington in order to escalate the NAFTA matter.

Unlike political plays & trade-war concerns, economic calendar is almost silent with monthly reading of Canadian Manufacturing Sales and a speech from ECB President up for release. While Canadian Manufacturing Sales is expected to register 1.0% growth against 1.1% prior, Mr. Draghi’s speech isn’t from a formal set-up and might not allow much information for the central-bank’s future policy moves.

With the investors waiting for China’s response to Trump’s salvo, a tough retaliation and/or cancellation to expected Sino-US meet may escalate the safe-havens, mainly the USD, but readiness to start the talk soon might drag the USD back to south. Moreover, NAFTA can keep hurting the CAD and the Brexit is less likely to have any major updates until the summit for now, which in-turn may offer less ammunition to the GBP. Additionally, the Korean meet may have some good news or clears signs of performance for White House and can diffuse some Geo-political pressure of the market but broader trade-war fears can outweigh such positive unless being too dramatic.

Technical Talk

100-day SMA level of 1.3170 presently challenges the GBPUSD’s recent up-moves and highlights the importance of 1.3110 trend-line support, which if broken can reprint 1.3065-60 on the chart. Though, an upside clearance of 1.3170 on a daily closing basis may further propel prices to 1.3200-3210 resistance-region. Further, AUDUSD also has to surpass the 0.7230-40 barrier in order to target the 0.7270 & 0.7310 otherwise its pullback to 0.7140 & 0.7080 can’t be denied. At the end, the EURJPY struggles with five-month old descending trend-line figure of 130.85 and the 200-day SMA level of 131.10 that should be conquered on a D1 close if the quote aims for 131.40 & 132.00 resistances else the 130.00 and the 100-day SMA level of 129.15 could regain market attention.

Have a nice trading-day ……

[FxAnil]

Daily Fundamental Dose: 19 – September – 2018

Hello Traders,

China’s tit-for-tat to levy fresh tariffs on $60 billion worth of US goods got the ire from Mr. Trump as he proposed additional taxes on virtually all of the Chinese imports around $267 billion. As a result, the US Dollar’s safe-haven buying helped greenback optimists to witness first positive day. With this, EUR & GBP couldn’t hold their earlier gains before today’s Brexit summit as there were no major economics to follow but AUD, NZD & CAD strengthened after China pledged to take multiple measures to ward-off trade-war’s side-effects. Further, the JPY & the Gold had to take the losses due to rising USD whereas Crude surged on speculations that OPEC-led coalition may not increase their output at upcoming meet.

While Sino-US trade feud did support the US Dollar during Tuesday, early-Wednesday offered a rather negative start to the currency because of the China’s readiness to send a team of diplomats to restart trade-talks with the U.S. Moreover, latest tariffs announced by both the countries seemed lesser than initially proposed, which in-turn raised hopes that there is still some room to avoid full-fledged trade-war between the world’s two largest economies.

At the economic front, Bank of Japan praised recent economic developments and let the monetary policy unchanged at today’s meeting that triggered the JPY’s short covering whereas BoJ Governor’s comment measured response to prolonged monetary easing confined the Yen’s upside. Additionally, positive news from the Korean meet spread after North Korea agreeing to take further steps towards giving up his nuclear weapons while some EU & UK policymakers gave public appearances to justify their proposals before two-day Brexit summit starting from today.

Even if recent positive turn in US-China trade front, also good-news from North Korea, signaling brighter chances of risk-on, the Brexit discussions have been too vague and may continue threatening the investors. It should also be noted that China hasn’t yet officially shared his response to send the team to US for trade-talks and Mr. Trump is also not happy with the Dragon nation’s retaliation. Moreover, NAFTA talks are also in pipeline with Canada facing pressure from in and out to reach the deal before October 01. Hence, the Geo-political front can keep entertaining investors for the day.

Not only political plays and trade front but economic calendar also has some important details to look, namely UK CPI, New Zealand GDP & US Housing market stats. Starting with the U.K. CPI, the headline inflation gauge is expected to soften to 2.4% from 2.5% and may stretch the Pound’s latest dip but progress on Brexit might confine its losses. Further, the U.S. Housing numbers may register mixed readings as Housing Starts could improve to 1.24M from 1.17M but the Building Permits bears the unchanged consensus of 1.31M. At the end, quarterly reading of New Zealand GDP can help the Kiwi the extend its upside if matching 0.8% forecast against 0.5% prior.

To sum up, developments concerning global trade, NAFTA, Brexit and headline data-points together can constitute an important day for investors.

Technical Talk

EURUSD couldn’t surpass the 1.1715 trend-line on a daily closing basis but is still above 100-day SMA level of 1.1665, which in-turn signal brighter chances for the pair’s another attempt to conquer the 1.1715 barrier and rush to 1.1760-65 resistance-region. However, a downside close beneath 1.1665 highlights the importance of 50-day SMA level of 1.1600. On the other hand, NZDUSD heads to the 0.6615-20 horizontal-region, breaking which 0.6640 trend-line becomes important for the pair buyers to watch whereas 0.6570 support-line and the 0.6540 could entertain short-term sellers. In case of the EURGBP, the pair might witness pullback from 0.8865-60 support-confluence towards 0.8900 & 0.8935 resistances but dip below 0.8860 could fetch prices to the 200-day SMA level of 0.8830

Have a nice trading-day ……

[FxAnil]

Weekly Fundamental Dose: 20 – September – 2018

Hello Traders,

While lesser than initially proposed US tariffs and China’s acceptance of Washington’s invitation for trade-talk, not to forget North Korea’s readiness for complete denuclearization, dimmed the USD’s safe-haven allure off-late, Brexit summit, NAFTA talks and some headline data-points are still in pipeline. As a result, the Eco-politico catalysts can continue being crucial to global markets.

Let’s not waste much time and start discussing fundamental concerning them.

Optimism Surrounding Trade Front & Brexit Hurt The USD

During last-week, not only American inclination to restart trade negotiation with China and sluggish US consumer-centric details but optimism at Brexit and welcome data-points from EU & UK also played their roles in dragging the US Dollar Index (I.USDX) downwards and fueling the EUR & the GBP towards north. With market optimism, JPY remained despicable to investors but the Gold benefited from the USD’s decline while Crude prices surged on fears emanating from hurricanes, upcoming Iranian sanction and declining US inventories. Given the receding threats of a full-fledged trade-war between world’s two largest economies and welcome stats from home, AUD, NZD & CAD also recovered their latest losses.

Investors Undermined Sino-US Tussle But Lack Of Positives Confined Trade Sentiments

At the start of present week, US announced fresh tariffs on $200 billion worth of Chinese Goods and China also retaliated with a list of $60 billion US goods to bear additional duties. However, the tariff rate to be charged after September 24 was lesser than initial promised by both the economies and the invitation to re-start trade negotiation is still on the table. With this, traders expected US-China tussle to calm down sooner or later by cutting their risk-safety bets for the USD but lesser positives from elsewhere confined trade-sentiment recently. As a result, the commodity currencies, namely AUD, NZD & CAD, got a boost to stretch their upside while EUR & GBP also witnessed sustained buying on optimism surrounding Brexit summit. Though, latest news from Brexit summit revealed that UK PM is still far from solving Irish boarder issue with the EU, which in-turn restricted the GBP’s gains.

While USD’s decline helped Gold to remain strong, the JPY had to bear the burden of BoJ’s dovish stand whereas Crude prices continued on their north-run expecting absence of increased output from OPEC-led alliance and depleting US inventories.

What Next?

Having witnessed change in investor sentiment, analysts may adhere to concentrate more on economic calendar in search of additional moves. Herein, Thursday’s UK Retail Sales and Friday’s EU Flash PMIs, together with Canadian Retail Sales & CPI, up on Friday as well, could gain major attention. Moreover, Thursday’s US Philly Fed Manufacturing Index, Existing Home Sales and Friday’s Japanese National Core CPI are some other stats that could offer intermediate market moves.

Starting with the UK Retail Sales, the crucial indicator for British GDP may disappoint Pound buyers if matching -0.2% forecast compared to +0.7% earlier growth. On the other hand, the U.S. Philly Fed Manufacturing Index might offer a sigh of relief to greenback optimists as consensus show 17.5 figure versus 11.9 earlier while Existing Home Sales may also stop its consecutive five-month decline if posting 5.36M expected number against 5.34M prior.

On Friday, Japanese National Core CPI may register 0.9% growth vis-a-vis 0.8% earlier while EU Flash Manufacturing & Services PMIs are likely to maintain their previous stages at 54.4 and 54.5 respectively, which in-turn might not become a too big event for the EUR traders to consider unless printing drastic changes. Additionally, Canadian Retail Sales could reverse earlier contraction of -0.2% with +0.3% growth but the CPI may drop to -0.1% from +0.5%.

Other than economics, developments on NAFTA, Brexit and US relations with North Korea and China could also keep providing background music to traders’ fraternity. Among them, NAFTA is at critical stage even after four-weeks of talks between US & Canadian policymakers and the US has already showed its inclination to go ahead with bi-lateral trade with Mexico if Canada fails to make a deal by October 01.

In case of Brexit, EU & UK policymakers couldn’t register any progress on first day of summit and are likely keep struggling with Irish border issue. Even if they manage to reach any raw deal, some amongst the British PM’s party members are ready to oppose the proposal and that may end-up hurting the GBP.

Looking at the U.S. part, North Korean reaction to denuclearization can be considered as Mr. Trump’s victory but China is still challenging him on trade front. Hence, unless there is a deal/discussion on future US-China trade format, uncertainty can keep supporting the USD’s safe-haven demand.

To sum up, economics are likely to help the US Dollar but receding pessimism on trade might confine the greenback’s allure whereas GBP could find it hard to sustain its gains with Brexit & scheduled stats signaling negative lights. Further, the commodity currencies can benefit from the trade optimism and need to confront weaker stats while welcome Inflation can help the JPY recover some of its latest losses.

Technical Analysis

Not only fundamental but technical analysis also signals interesting days ahead as majority of top-tier FX pairs are near to their short-term important resistances. Starting with the EURUSD, the major couldn’t cross more than ten-week old descending TL, at 1.1715, but is still above 100-day SMA level of 1.1660, which in-turn might fuel the pair to 1.1715 again in order to aim for the 1.1800 and the 1.1830 resistances while a downside close below 1.1660 may reprint 1.1600 with 1.1530-20 likely limiting its following downside. Moving on to the GBPUSD, the pair has to surpass 1.3160 hurdle, including 100-day SMA, on a daily closing basis to target 1.3220 and the 1.3300 stats to north whereas the 1.3080, the 1.3000 round-figure and the 1.2980, including 50-day SMA, may act as nearby supports for the pair. Further, USDJPY failed to sustain its break of 112.15-20 resistance-zone but is still above the resistance-turned-support and might challenge the 112.60 and the 113.15-20 levels; though, dip beneath 112.15 can recall the 111.65 and the 111.00 on the chart.

In case of USDCAD, 200-day SMA level of 1.2865 is likely upcoming quote, breaking which 1.2740 may become sellers’ favorite while the 1.2970, the 1.3000 and the 1.3050, comprising 100-day SMA, might challenge the buyers. Additionally, AUDUSD has 0.7300-0.7310 as strong resistance-region to conquer if it is to visit the 0.7370 & 0.7400 else its pullback to 0.7230 & 0.7140 can’t be denied. At the end, NZDUSD may also find it hard to extend latest recovery towards 0.6730 unless clearing the 0.6685-90 barrier, if not then the 0.6620 and the 0.6555 could gain market attention.

Have a nice trading-day ……