27 Nov 2018

FOREX Newsletter

FOREX Newsletter

November 27, 2018

 

Pulse of the Market

·      The U.S will publish CB Consumer Confidence, which is forecast to dip to 136.2 points

·      The euro gained against the dollar today on signs that Italy may cut its budget deficit target

·      Japanese Flash Manufacturing PMI dipped to 51.8, shy of the estimate of 53.0

·      The Pound steadied yesterday after Britain sealed a deal with the European Union

The Dollar inched down yesterday amid geopolitical tensions as investors pause ahead of a planned meeting between U.S.-China leaders later this week. The U.S dollar index, which measures the greenback’s strength against a basket of six major currencies, was down 0.04% to 96.785, retreating from one-week highs of 96.96 reached overnight. Trade worries weighed on the greenback, as investors wait for the G20 summit in Argentina on Friday. U.S President Donald Trump and Chinese President Xi Jinping are expected to meet on the sidelines to discuss a possible trade deal. The euro pared back earlier gains the dollar, with EUR/USD rising 0.12% to 1.1350, boosted by news that disagreements between Rome and Europe could be resolved. Italian Deputy Prime Minister Matteo Salvini indicated that his government could lower its borrowing targets, which the European Commission had said is against EU fiscal rules. Broader optimism over the euro was also reflected in the latest weekly positioning data, where long dollar positions have been declining slightly for the week ending November 16. The pound was also higher, with GBP/USD up 0.20% to 1.2839. On Sunday, EU leaders approved the terms of the UK’s withdrawal from the bloc, the Brexit deal will have to pass a vote in the British parliament in early December. The dollar was higher against the safe-haven Japanese yen, with USD/JPY rising 0.41% to 113.43. In times of uncertainty, investors tend to invest in the Japanese yen, which is considered a safe asset during periods of risk aversion. The Canadian dollar strengthened against its U.S. counterpart on Monday, paring some of last week’s decline, as oil prices and stocks rallied. Stocks were boosted by robust sales in the holiday season, after a steep selloff on Wall Street in the previous session. Canada exports many commodities, including oil, and runs a current account deficit, so its economy could benefit from an improved outlook for the global flow of trade or capital. The price of oil recovered some of the previous session’s near-7 per cent fall. U.S crude prices were up 2.7 per cent at $51.77 a barrel. The loonie gained despite a report that General Motors Co. plans to announce it will significantly cut car production in North America and stop building some low-selling car models.

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
  German Retail Sales (YoY) (OCT) Medium     -2.6%
11:00 U.K CBI Reported Sales (NOV) Low   10 5
14:00 U.S House Price Index (MoM) (SEP) Medium   0.4% 0.3%
14:00 U.S House Price Purchase Index (QoQ) (3Q) Medium     1.1%
14:00 S&P CoreLogic CS 20-City (MoM) SA (SEP) Medium   0.25% 0.09%
14:00 S&P/Case-Shiller Composite-20 (YoY) (SEP) Medium   5.3% 5.49%
14:00 S&P/Case-Shiller US Home Price Index (YoY) (SEP) Medium     5.77%
15:00 U.S Consumer Confidence Index (NOV) High   136.0 137.9
15:00 U.S Conf. Board Present Situation (NOV) Medium     172.8
15:00 U.S Conf. Board Expectations (NOV) Low     114.6
19:30 U.S Fed’s Bostic, Evan and George Speak on Panel Low      
20:00 RBNZ Publishes Financial Stability Report Medium      

 

Euro

The single currency gained against the dollar on signs that Italy may cut its budget deficit target to satisfy the European Union, and as a rebound in oil prices helped to improve risk sentiment. The Euro gained despite data showing that German business morale fell by more than expected in November as the country’s exporters get caught up in a trade dispute. Overall, the EUR/USD traded with a low of 1.1323 and a high of 1.1382 before closing the day around 1.1326 in the New York session.

 

Yen

The Japanese Yen pair ticked higher yesterday. On the release front, Japanese Flash Manufacturing PMI dipped to 51.8, shy of the estimate of 53.0. This marked a 4-month low. There were no U.S indicators on the schedule. Today, Japan releases BoJ Core CPI, the preferred inflation indicator of the Bank of Japan. Overall, the USD/JPY traded with a low of 112.86 and a high of 113.63 before closing the day around 113.56 in the U.S session.

 

British Pound

The British Pound steadied after Britain sealed a deal with the European Union on quitting the bloc, with the currency’s gains curbed by doubts about whether Prime Minister Theresa May can get the agreement through a divided parliament. Sterling traders are focused on a parliamentary vote on the deal likely to take place in mid-December. Overall, the GBP/USD traded with a low of 1.2794 and a high of 1.2862 before closing the day at 1.2807 in the New York session.

 

Canadian Dollar

The Canadian Dollar strengthened against its U.S counterpart yesterday, paring some of last week’s decline, as oil prices and stocks rallied. Canada exports many commodities, including oil, and runs a current account deficit, so its economy could benefit from an improved outlook for the global flow of trade or capital.  Overall, USD/CAD traded with a low of 1.3184 and a high of 1.3259 before closing the day at 1.3251 in the New York session.

 

Australian Dollar

The Australian Dollar traded higher earlier in the session yesterday but ended the day slightly lower as the RBA described a deteriorating property market. The local currency last Friday has eased and was on track for its worst weekly performances since early October as a global sell-off in equities took the shine off risk assets. The Australian dollar, often traded as a liquid proxy for global trade prospects. Overall, AUD/USD traded with a low of 0.7222 and a high of 0.7274 before closing the day at 0.7224 in the New York session.

 

Euro-Yen

EUR/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is issuing a bullish stance. The Relative Strength Index is above 48 and lies below the neutral zone. In general, the pair has gained 0.53%.

 

Sterling-Yen

Currently, GBP/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bearish tone and MACD is indicating a bullish stance. The Relative Strength Index is above 47 reading and lies below the neutral zone. On the whole, the pair has gained 0.53%.

  

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 54 reading and lies above the neutral region. In general, the pair has gained 0.41%.

 

Euro-Sterling

This cross is currently trading above 14, 50 and below 100 days moving average. Fast stochastic is indicating a bullish tone and MACD is also issuing a bearish signal. The Relative Strength Index is above 51 and lies above the neutral region. On the whole, the pair has lost 0.02%.

 

Sterling-Swiss

This cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bearish stance and MACD is also indicating a bearish tone. The Relative Strength Index is above 43 and lies above the neutral region. In general, the pair has gained 0.04%.

 

Appendix

  

FOREX Closing Prices for November 26, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.13336 1.13823 1.13235 1.13266 -0.0007
USD/JPY 112.905 113.632 112.86 113.567 0.6600
GBP/USD 1.28221 1.28623 1.27942 1.28078 -0.0004
USD/CHF 0.99687 0.99915 0.99525 0.99841 0.0009
USD/CAD 1.32231 1.3259 1.31846 1.32518 0.0019
EUR/JPY 128.002 128.895 127.906 128.641 0.6720
GBP/JPY 144.753 145.716 144.626 145.447 0.7700
CHF/JPY 113.216 113.779 113.132 113.72 0.5620
AUD/JPY 81.634 82.35 81.553 81.98 0.3380
EUR/GBP 0.8839 0.88669 0.88344 0.88403 -0.0002
EUR/CHF 1.13044 1.13397 1.13001 1.13091 0.0002
GBP/CHF 1.27817 1.28295 1.27686 1.27869 0.0005

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1247 1.1285 1.1306 1.1344 1.1365 1.1403 1.1424
USD/JPY 112.30 112.58 113.07 113.35 113.85 114.13 114.62
GBP/USD 1.2712 1.2753 1.2781 1.2821 1.2849 1.2890 1.2917
USD/CHF 0.9922 0.9937 0.9961 0.9976 1.0000 1.0015 1.0039
USD/CAD 1.3130 1.3157 1.3205 1.3232 1.3279 1.3306 1.3353
EUR/JPY 127.08 127.49 128.07 128.48 129.06 129.47 130.04
GBP/JPY 143.72 144.17 144.81 145.26 145.90 146.35 146.99
CHF/JPY 112.66 112.90 113.31 113.54 113.96 114.19 114.60
AUD/JPY 80.78 81.16 81.57 81.96 82.37 82.76 83.17
EUR/GBP 0.8795 0.8815 0.8828 0.8847 0.8860 0.8880 0.8893
EUR/CHF 1.1253 1.1277 1.1293 1.1316 1.1333 1.1356 1.1372
GBP/CHF 1.2700 1.2734 1.2761 1.2795 1.2821 1.2856 1.2882

 

Sources:  News, Charts & Quotes (Courtesy: Reuters, US Department Of Treasury)

 

Disclaimer

This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.

The firm or its staff members may trade on their own account and may from time to time hold or act as market makers in investments mentioned in this document. Please note that the firm makes no warranty, expressed or implied, as to the accuracy or completeness of the information and opinions herein. All parties are advised to seek independent professional advice as to the suitability of any products and to their tax, accounting, legal or regulatory implications. City Credit Capital (UK) Ltd is authorized and regulated by the Financial Conduct Authority, reg 232015.

 

 

27 Nov 2018

Daily Market View

 

Daily Market View

Tuesday, November 27, 2018
          U.S Stock Market

 

DJIA S & P 500 NASDAQ
24587 2668.75 6670.00
+1.46% +1.55% +2.06%

U.S stocks rallied yesterday as oil prices and global equities gained ground on a day that is arguably one of the most important for retailers as shoppers go hunting for deals on Cyber Monday. The Dow Jones Industrial Average climbed 278 points, or 1.2%, while the S&P 500 index rose 30 points, or 1.1%. The NASDAQ rallied 96 points, or 1.4%. Last week, the NASDAQ tumbled 4.3%, the Dow ended the week 4.4% lower, while the S&P 500 notched a week-on-week decline of 3.8%, marking the worst Thanksgiving week since 2011 for all three U.S indexes. Losses for oil prices pushed stocks lower last week, and the reverse was true for yesterday. After losing 7.7% in Friday’s session alone, U.S crude futures rose more than 2% to trade above $51 a barrel, while Brent crude jumped nearly 3% to above $60. The retail industry was in focus as investors digested initial data on consumers’ willingness to spend this holiday season after shoppers began deal-hunting in earnest ahead of the holidays.

 

 

Major Economic Releases for Today
Period Event GMT Forecast Previous

oct

German Retail Sales (YoY)     -2.6%

nov

U.K CBI Reported Sales 11:00 10 5

 

U.S Fed Vice Chairman Clarida Speaks in New York 13:30    

sep

U.S House Price Index (MoM) 14:00 0.4% 0.3%

3Q

U.S House Price Purchase Index (QoQ) 14:00   1.1%

sep

S&P/Case-Shiller US Home Price Index (YoY) 14:00   5.77%

nov

U.S Consumer Confidence Index 15:00 136.0 137.9

nov

U.S Conf. Board Present Situation 15:00   172.8

nov

U.S Conf. Board Expectations 15:00   114.6
Dow Jones Industrial Average

The Dow Jones Industrial Average gained 1.46%. The best performers of the session on the Dow Jones Industrial Average were American Express Company, which rose 3.73% or 3.94 points to trade at 109.68 at the close. Meanwhile, Microsoft Corporation added 3.30% or 3.40 points to end at 106.47 and The Travelers Companies Inc. was up 2.95% or 3.74 points to 130.34 in late trade. The worst performers of the session were United Technologies Corporation, which fell 0.82% or 1.06 points to trade at 127.98 at the close. Coca-Cola Company declined 0.31% or 0.15 points to end at 48.87 and Johnson & Johnson was up 0.03% or 0.04 points to 141.37.

 

 

 

NASDAQ 100

The NASDAQ index gained 2.06%. The top performers on the NASDAQ Composite were Tyme Technologies Inc. which rose 30.23% to 2.80, Safe-T Group Ltd ADR which was up 29.18% to settle at 5.8000 and Adial Pharmaceuticals Inc. which gained 24.81% to close at 1.66. The worst performers were Zafgen Inc. which was down 40.55% to 5.41 in late trade, Mercantil Bank Holding Corp which lost 22.58% to settle at 12.00 and Tenax Therapeutics Inc. which was down 19.69% to 2.610 at the close.

 

 

Oil

Oil rose yesterday, recovering some of the previous session’s sharp fall, although uncertainty over global economic growth limited the gains. U.S crude futures were up $1.25, or 2.5 percent, at $51.67 a barrel. The gains partly made up for Friday’s 7.7 percent drop. Prices on Friday hit their lowest since October 2017 amid intensifying fears of a supply glut. Supporting oil prices, U.S stock markets broadly rallied as Cyber Monday, the largest online shopping day of the year, began. Crude futures at times track with the equities market. Prices found some support as crude stockpiles at the U.S. hub of Cushing, Oklahoma, rose just 126 barrels from Tuesday to Friday, traders said, citing a report from market intelligence firm Genscape. However, demand concerns and record output from Saudi Arabia limited Monday’s rebound. Saudi crude oil production hit 11.1-11.3 million bpd in November, an all-time high.

 

Precious and Base Metals

Gold firmed yesterday, supported by uncertainty over the future pace of U.S interest rate hikes and the outcome of the G20 summit later this week when global leaders will focus on trade tensions. Spot gold was mostly unchanged at $1,222.70 per ounce. U.S gold futures were steady at $1,222.20 per ounce. U.S President Donald Trump and his Chinese counterpart Xi Jinping are expected to discuss their trade dispute at the G20 summit in Argentina, which begins on Friday. If Trump and Xi can’t come to an agreement at the G20 meeting, I think there will be a pause in the U.S Federal Reserve’s rate increases next year, which in turn will help gold prices go higher. Uncertainties related to Brexit and Italy are also helping build a base for gold, which was helped by a slight retreat in the dollar earlier in the session, he added. The euro gained against the dollar on signs Italy may cut its budget deficit target to satisfy the European Union, while the sterling rose after the EU and Britain sealed a Brexit deal. Analysts remain cautious, however, as the Brexit deal faces stiff opposition in the British parliament. Gold’s direction in the near term would be determined by moves in the greenback, which could be pressured if the Fed takes a more cautious approach to future policy tightening amid concern of an economic slowdown next year, analysts said. The metal could be in for a sizeable drop should support at $1,220 break, in which case a return back down to the next support at $1,205 would become likely. With the 10-year U.S bond yields on the rise again, this may support the greenback and simultaneously prevent gold from going higher. Gold prices have lost about 10 percent from their April peak and are down 6 percent so far this year. Speculators increased their net short positions in Comex gold and silver contracts in the week to Nov. 13. Among other precious metals, silver was steady at $14.23 an ounce and platinum rose 0.3 percent to $840.99.

 

 

 

Traditional Agricultures

Soybean futures fell more than 2 percent and neared a four-week low yesterday on chart-based selling and worries about export prospects for U.S supplies amid a trade war with China. Corn futures followed soybeans lower. But wheat futures rose.

 

Futures Settlement Price Monday, November 26, 2018
Instrument Contract Open High Low Settlement Net Change
DJIA DJM18 24273 24662 24269 24587 333
S & P 500 SPM18 2633 2676 2631.5 2668.75 40.25
NASDAQ 100 NDM18 6539.5 6696 6530.25 6670 140
Hang Seng HSH18 25981 26421 25973 26397 506
Nikkei 225 NKH18 21525 21835 21525 21830 110
FTSE 100 FTH18 6976 7051 6976 7047.5 100.5
Gold GCJ18 1222.7 1228.3 1221.5 1222.1 -1
Silver SIK18 14274 1424.5 1423.5 1424.5 -0.5
Copper HGK18 276.3 278.1 273.7 274.55 -1.45
Crude Oil CLK18 50.56 52.21 50.32 51.57 1.19
Wheat WK18 502.25 507.5 501.5 507 7.75
Soybeans SK18 881.75 882.5 856.75 861.5 -18.75
Corn CK18 359.25 359.25 355 355.5 -3.25

 

Daily Swings  (The Pivot Levels)
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
DJM18 23957 24113 24350 24506 24743 24899 25136
SPM18 2597.00 2614.25 2641.50 2658.75 2686.00 2703.25 2730.50
NDM18 6402.42 6466.33 6568.17 6632.08 6733.92 6797.83 6899.67
HSH18 25658 25816 26106 26264 26554 26712 27002
NKH18 21315 21420 21625 21730 21935 22040 22245
FTH18 6923.67 6949.83 6998.67 7024.83 7073.67 7099.83 7148.67
GCJ18 1212.83 1217.17 1219.63 1223.97 1226.43 1230.77 1233.23
SIK18 1422.83 1423.17 1423.83 1424.17 1424.83 1425.17 1425.83
HGK18 268.40 271.05 272.80 275.45 277.20 279.85 281.60
CLK18 48.63 49.48 50.52 51.37 52.41 53.26 54.30
WK18 497.17 499.33 503.17 505.33 509.17 511.33 515.17
SK18 825.58 841.17 851.33 866.92 877.08 892.67 902.83
CK18 349.67 352.33 353.92 356.58 358.17 360.83 362.42

 

Source: – News & Quotes (Courtesy:  Reuters)                                                             

Disclaimer

This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.

The firm or its staff members may trade on their own account and may from time to time hold or act as market makers in investments mentioned in this document. Please note that the firm makes no warranty, expressed or implied, as to the accuracy or completeness of the information and opinions herein. All parties are advised to seek independent professional advice as to the suitability of any products and to their tax, accounting, legal or regulatory implications. City Credit Capital (UK) Ltd is authorized and regulated by the Financial Conduct Authority, reg 232015.