20 Dec 2018

FOREX Newsletter

FOREX Newsletter

December 20, 2018

 

Pulse of the Market

·      U.S central bank hiked interest rates by 25 basis points and forecast fewer rate increases next year

·      The focus for Yen traders will be on the Bank of Japan’s rates decision later in the day

·      Italy had struck a deal with the European Commission over its contested 2019 budget

·      Sterling is trading off its lows ahead of the UK central bank’s final policy meeting of the year

 

The Dollar rallied after a Federal Reserve rate hike but yesterday’s gains were unexpected for a few reasons. First, most investors were looking for Fed Chair Powell to be dovish and when he lined his comments with optimism, the dollar rose. Secondly, the dollar rallied despite the fact that 10-year Treasury yields dropped to an 8 month low. Rate hike expectations also declined with the market now pricing in a greater chance of a rate cut than a rate hike in 2020. All of this combined with downgraded GDP and inflation forecasts should have driven the greenback lower but instead, the dollar rallied because the tweaks to the policy statement weren’t dovish enough. Investors had braced for the worst – from no rate hike to dissents and a change in the risk assessment. And while there were subtle tweaks in the statement and lowered growth and inflation forecast, these changes were not as significant as the market had hoped. The same was true of Fed Chair Powell’s comments – he made it clear that nothing is predetermined and everything is data dependent but he also said the sharp decline in US equities and the tightening of financial market conditions has not fundamentally altered their outlook. The Fed still plans to raise interest rates next year and most policymakers expect the economy to grow.  Next up is the Bank of England. Sterling is trading off its lows ahead of the UK central bank’s final policy meeting of the year. Unlike the Fed, there will be no changes to interest rates. The last time the BoE met, they sent GBP/USD soaring above 1.30 on the talk of rate hikes. According to the summary of the report that month the MPC said “Were the economy to continue to develop broadly in line with the November Inflation Report projections, an ongoing tightening of monetary policy over the forecast period would be appropriate.” To add to that Governor Carney said a Brexit deal could release pent up investment demand but a no-deal Brexit could also lead to a major supply shock that could drive up inflation and interest rates. Fast forward 7 weeks and the UK is no closer to a Brexit deal.

 

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
  BOJ Rate Decision (DEC 20) High     -0.10%
00:30 Australia Employment Change (NOV) High   20.0k 32.8k
00:30 Australia Unemployment Rate (NOV) High   5.0% 5.0%
06:00 Japan Machine Tool Orders (YoY) (NOV) Low     -16.8%
09:30 U.K Retail Sales Ex Auto Fuel (YoY) (NOV) Medium   2.3% 2.7%
12:00 Bank of England Bank Rate (DEC 20) High   0.75% 0.75%
12:00 BOE Asset Purchase Target (DEC) High   435b 435b
13:30 U.S Philadelphia Fed Business Outlook (DEC) Medium   15.5 12.9
13:30 U.S Initial Jobless Claims (DEC 15) Medium   219k 206k
13:30 U.S Continuing Claims (DEC 8) Medium   1665k 1661k
15:00 U.S Leading Index (NOV) Medium   0.1% 0.1%
21:00 New Zealand ANZ Consumer Confidence (MoM) (DEC) Low     2.8%
23:30 Japan National Consumer Price Index (YoY) (NOV) High   0.8% 1.4%

Euro

The single currency notched up its biggest daily rise against the Dollar and the Pound in more than a week yesterday as diminishing political worries in Italy and strong trade data contrasted with growing concerns about Britain’s plans to avoid a “no-deal” Brexit. Trade data this week showed European exports rose by more than 11 percent in October. Overall, the EUR/USD traded with a low of 1.1360 and a high of 1.1438 before closing the day around 1.1375 in the New York session.

 

Yen

The Japanese Yen rally continues to climb this week. Earlier in the day, the pair dropped to its lowest level since late October. On the release front, Japan’s trade deficit widened for a fourth straight week, ballooning to 0.49 trillion yen, much higher than the previous month’s deficit of 0.30 trillion. The estimate stood at 0.31 trillion yen. Overall, the USD/JPY traded with a low of 112.06 and a high of 112.64 before closing the day around 112.46 in the U.S session.

 

British Pound

The British Pound declined against its major counterparts earlier in the session after a data showed that UK consumer price inflation slowed to its lowest level in twenty months in November amid lower oil prices. But Sterling manage to reverse its losses and closed the session higher against the U.S Dollar. Overall, the GBP/USD traded with a low of 1.2605 and a high of 1.2677 before closing the day at 1.2609 in the New York session.

 

Canadian Dollar

The Canadian Dollar edged higher as oil prices and stocks rose, but the currency pared gains after domestic inflation data supported bets for the BOC to stay sidelined over the coming months. Lower gas prices pulled Canada’s annual inflation rate in November down to 1.7 per cent, the first time in 10 months it has been below the 2.0 per cent target. Overall, USD/CAD traded with a low of 1.3411 and a high of 1.3504 before closing the day at 1.3480 in the New York session.

 

Australian Dollar

The Australian Dollar remained under pressure, losing ground against most of the major crosses yesterday despite continued U.S Dollar weakness. There was little reaction to a speech from Chinese President Xi Jinping that failed to outline any specific measures to help support the Chinese economy. Instead, short-covering ahead of Fed interest rate decision was the likely catalyst. Overall, AUD/USD traded with a low of 0.7168 and a high of 0.7199 before closing the day at 0.7170 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 46 and lies below the neutral zone. In general, the pair has gained 0.11%.

 

Sterling-Yen

Currently, GBP/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is indicating a bearish stance. The Relative Strength Index is above 35 reading and lies below the neutral zone. On the whole, the pair has lost 0.27%.

 

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 38 reading and lies below the neutral region. In general, the pair has lost 1.03%.

 

Euro-Sterling

This cross is currently trading above 14, 50 and below 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 64 and lies above the neutral region. On the whole, the pair has gained 0.36%.

 

Sterling-Swiss

This cross is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is indicating a bearish tone. The Relative Strength Index is above 40 and lies below the neutral region. In general, the pair has lost 0.02%.

 

Appendix

  

FOREX Closing Prices for December 19, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.13635 1.14387 1.13602 1.13753 0.0016
USD/JPY 112.501 112.646 112.069 112.46 -0.0480
GBP/USD 1.26421 1.26775 1.26051 1.26091 -0.0029
USD/CHF 0.9922 0.99545 0.99046 0.99436 0.0018
USD/CAD 1.34651 1.35042 1.34118 1.34803 0.0018
EUR/JPY 127.853 128.36 127.529 127.944 0.1360
GBP/JPY 142.235 142.512 141.557 141.819 -0.3780
CHF/JPY 113.348 113.397 112.84 113.064 -0.2540
AUD/JPY 80.729 80.98 79.536 79.917 -0.8340
EUR/GBP 0.89877 0.90397 0.8978 0.90197 0.0033
EUR/CHF 1.12778 1.13426 1.12753 1.13131 0.0036
GBP/CHF 1.25421 1.25751 1.25192 1.25421 -0.0003

  

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1266 1.1313 1.1344 1.1391 1.1423 1.1470 1.1501
USD/JPY 111.56 111.81 112.14 112.39 112.71 112.97 113.29
GBP/USD 1.2511 1.2558 1.2584 1.2631 1.2656 1.2703 1.2728
USD/CHF 0.9864 0.9884 0.9914 0.9934 0.9964 0.9984 1.0014
USD/CAD 1.3334 1.3373 1.3427 1.3465 1.3519 1.3558 1.3611
EUR/JPY 126.70 127.11 127.53 127.94 128.36 128.78 129.19
GBP/JPY 140.46 141.01 141.41 141.96 142.37 142.92 143.32
CHF/JPY 112.25 112.54 112.80 113.10 113.36 113.66 113.92
AUD/JPY 77.86 78.70 79.31 80.14 80.75 81.59 82.20
EUR/GBP 0.8924 0.8951 0.8985 0.9012 0.9047 0.9074 0.9109
EUR/CHF 1.1211 1.1243 1.1278 1.1310 1.1345 1.1378 1.1413
GBP/CHF 1.2460 1.2490 1.2516 1.2545 1.2572 1.2601 1.2628

 

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.

 

 

19 Dec 2018

FOREX Newsletter

FOREX Newsletter

December 19, 2018

 

Pulse of the Market

·      The U.S Dollar slid lower against a currency basket ahead of today’s Federal Reserve meeting

·      The Japanese Yen remained supported amid concerns over the outlook for global growth

·      The pound was higher amid an ongoing political deadlock over Britain’s efforts to exit the EU

·      Bank of Canada Governor Stephen Poloz left the door open to a slower pace of interest rate hikes

 

 

The U.S Dollar was lower yesterday as investors waited for news from the Federal Reserve’s latest policy meeting. The U.S dollar index, which measures the greenback’s strength against a basket of six major currencies, fell 0.14% to 96.41, after an overnight high of 96.63. With the Fed expected to increase rates by 25 basis points for the fourth time this year today, investors will be watching for any new comments on possible policy changes in 2019. Fed officials, including Fed Chairman Jerome Powell, have said interest rates are nearing neutral and have become more cautious about FOMC tightening policy amid worry of slowing global growth. U.S. President Donald Trump’s critical comments on the Fed did not help the dollar’s cause either. In a tweet overnight, Trump took another swipe at the Fed, saying it was “incredible” for the central bank to even consider tightening policy given the global economic and political uncertainties. While the Fed remaining on hold would be a significant surprise and a significant U.S Dollar-negative, there is little doubt that equity market volatility is creating some headaches for policymakers. Osborne noted that Fed rate hike expectations have slipped, with markets now pricing in a 70 percent chance of a rate increase, down from a 78 percent chance on Monday. Investor confidence has deteriorated, leading to the gloomiest outlook for the world economy in a decade. The Dollar has replaced technology stocks as the most crowded trade for the first time since January. Risk-off sentiment yesterday lifted the Japanese yen and Swiss franc. Yen traders are also focusing on the Bank of Japan’s meeting on Dec. 19-20, at which it is widely expected to keep policy ultra-loose as inflation remains well below its target. The Pound Sterling continues to move off of the recently struck 20-month trough after it was confirmed that the Prime Minister will ask for the British Parliament to approve her latest Brexit proposal next month. The Canadian Dollar fell against the U.S Dollar yesterday.

 

 

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
07:00 German Producer Price Index (YoY) (NOV) Low   3.1% 3.3%
09:30 U.K Consumer Price Index (YoY) (NOV) High   2.3% 2.4%
09:30 U.K Retail Price Index (YoY) (NOV) Low   3.2% 3.3%
09:30 U.K House Price Index (YoY) (OCT) Medium   3.3% 3.5%
12:00 U.S MBA Mortgage Applications (DEC 14) Medium     1.6%
13:30 Canada Consumer Price Index (YoY) (NOV) High   1.8% 2.4%
15:00 U.S Existing Home Sales (MoM) (NOV) Medium   -0.4% 1.4%
15:30 DOE U.S. Crude Oil Inventories (DEC 14) Medium     -1208k
19:00 U.S FOMC Rate Decision (Upper Bound) (DEC 19) High   2.50% 2.25%
19:00 U.S FOMC Rate Decision (Lower Bound) (DEC 19) High   2.25% 2.00%
19:00 U.S Interest Rate on Excess Reserves (DEC 20) High   2.40% 2.20%
19:30 Fed’s Powell Holds Press Conference Following FOMC Decision Medium      
21:45 New Zealand Trade Balance (NOV) Medium   -880m -1295m
21:45 New Zealand Gross Domestic Product (YoY) (3Q) High   2.8% 2.8%

Euro

The single currency rose yesterday as the dollar weakened, with investors betting that growth concerns will prompt the Fed to slow its pace of interest rate hikes at this week’s meeting. A rout on Wall Street following a spate of weak data globally has strengthened the view that the Fed’s widely-expected rate hike today will usher in a slowdown. Overall, the EUR/USD traded with a low of 1.1335 and a high of 1.1401 before closing the day around 1.1359 in the New York session.

 

Yen

The Japanese Yen pair remained heavily offered through the European session yesterday and tumbled to over one-week lows in the last hour. A combination of negative forces kept exerting downward pressure for the third consecutive session. The concerns were evident from the recent fall in the US Treasury bond yields. Overall, the USD/JPY traded with a low of 112.23 and a high of 112.84 before closing the day around 112.50 in the U.S session.

 

British Pound

The British Pound continues to move off of the recently struck 20-month trough after it was confirmed that the Prime Minister will ask for the British Parliament to approve her latest Brexit proposal next month. Analysts caution that Theresa May will be fighting the fight of her life in order to get her deal through to find the backing of members from her own party. Overall, the GBP/USD traded with a low of 1.2608 and a high of 1.2703 before closing the day at 1.2638 in the New York session.

 

Canadian Dollar

The Canadian Dollar steadied against its U.S counterpart yesterday, underperforming other G10 currencies as oil prices fell and Bank of Canada Governor Stephen Poloz left the door open to a slower pace of interest rate hikes. The price of oil, one of Canada’s major exports, fell to its lowest since September of last year after reports of swelling inventories. Overall, USD/CAD traded with a low of 1.3387 and a high of 1.3494 before closing the day at 1.3462 in the New York session.

 

Australian Dollar

The Australian Dollar gained earlier in yesterday’s trading session but reversed almost all the gains to end the day slightly lower. Australian Dollar has been put on the defensive by worries about slowing growth in China. The currency had been sideswiped by disappointing Chinese economic data, which in turn rippled through markets globally sending stocks sharply lower. Overall, AUD/USD traded with a low of 0.7164 and a high of 0.7201 before closing the day at 0.7166 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 43 and lies below the neutral zone. In general, the pair has lost 0.16%.

 

Sterling-Yen

Currently, GBP/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is indicating a bearish stance. The Relative Strength Index is above 38 reading and lies below the neutral zone. On the whole, the pair has lost 0.10%.

 

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 40 reading and lies below the neutral region. In general, the pair has lost 0.25%.

 

Euro-Sterling

This cross is currently trading above 14, 50 and below 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 62 and lies above the neutral region. On the whole, the pair has lost 0.05%.

 

Sterling-Swiss

This cross is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is indicating a bearish tone. The Relative Strength Index is above 38 and lies below the neutral region. In general, the pair has gained 0.13%.

 

Appendix

  

FOREX Closing Prices for December 18, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.13463 1.14011 1.1335 1.13595 0.0013
USD/JPY 112.819 112.842 112.231 112.508 -0.3050
GBP/USD 1.26188 1.27039 1.2608 1.2638 0.0017
USD/CHF 0.99284 0.99357 0.98978 0.99252 -0.0002
USD/CAD 1.3405 1.34944 1.3387 1.34628 0.0059
EUR/JPY 128.025 128.09 127.619 127.808 -0.2060
GBP/JPY 142.348 142.63 141.907 142.197 -0.1420
CHF/JPY 113.596 113.648 113.231 113.318 -0.2720
AUD/JPY 80.963 81.176 80.633 80.751 -0.2040
EUR/GBP 0.89888 0.9009 0.89612 0.89869 -0.0005
EUR/CHF 1.12668 1.12947 1.2582 1.1277 0.0012
GBP/CHF 1.25292 1.25851 1.25159 1.25448 0.0016

  

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1263 1.1299 1.1329 1.1365 1.1395 1.1431 1.1462
USD/JPY 111.60 111.92 112.21 112.53 112.82 113.14 113.43
GBP/USD 1.2500 1.2554 1.2596 1.2650 1.2692 1.2746 1.2788
USD/CHF 0.9866 0.9882 0.9903 0.9920 0.9941 0.9957 0.9979
USD/CAD 1.3294 1.3341 1.3402 1.3448 1.3509 1.3555 1.3617
EUR/JPY 127.12 127.37 127.59 127.84 128.06 128.31 128.53
GBP/JPY 141.14 141.52 141.86 142.24 142.58 142.97 143.31
CHF/JPY 112.73 112.98 113.15 113.40 113.57 113.82 113.98
AUD/JPY 79.99 80.31 80.53 80.85 81.07 81.40 81.62
EUR/GBP 0.8915 0.8938 0.8962 0.8986 0.9010 0.9034 0.9058
EUR/CHF 1.3428 1.3005 1.2141 1.1718 1.0854 1.0431 0.9567
GBP/CHF 1.2443 1.2479 1.2512 1.2549 1.2581 1.2618 1.2651

 

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.

 

 

18 Dec 2018

FOREX Newsletter

FOREX Newsletter

December 18, 2018


Pulse of the Market

·      The U.S Empire State Manufacturing Index dropped sharply to 10.9, down from 23.3 points

·      British Prime Minister rescheduled a delayed vote in parliament on her Brexit plan for mid-January

·      The Euro clawed itself off recent lows yesterday as the dollar paused near 18-month highs

·      Canada exports many commodities, including oil, so its economy hurts by slower global growth

 

 

The U.S Dollar pulled back from an 18-month high yesterday after disappointing economic data. The U.S dollar index, which measures the greenback’s strength against a basket of six major currencies, fell 0.2% to 96.69, after an overnight high of 97.69. The Empire State manufacturing index was lower in December, adding to concerns over the health of the U.S. economy. The reading was at 10.90 from 23.30 in November, the New York Fed reported yesterday. Meanwhile, investors are looking ahead to Wednesday when the Federal Reserve is expected to increase rates by 25 basis points for the fourth time this year. Chances of a hike were priced in at 77.5%, according to Fed Rate Monitor Tool. Still, investors remain uncertain of the number of rate hikes in 2019 after dovish comments from Fed officials, who hint that interest rates are nearing neutral. Comments yesterday from U.S President Donald Trump added to the uncertainty, as he continued to criticize the pace of Fed hikes. Last week, the dollar enjoyed its best weekly performance since September, reaching an 18-month high on Friday. The euro, on the other hand, weakened last week after the European Central Bank cut inflation and growth forecasts and struck a cautious tone about the outlook for the world economy. The euro, meanwhile, rose 0.3 percent yesterday, even though EU statistics office Eurostat earlier lowered November’s inflation reading. Weaker-than-expected economic data from China and Europe last week sent investors toward the perceived safety of the dollar. Investors are now looking to a major speech by President Xi Jinping today to mark the 40th anniversary of China’s market reforms and opening up. China is also scheduled to hold its annual Central Economic Work Conference this week. The Canadian dollar weakened as lingering worries about global growth weighed on stocks ahead of a potential interest rate hike this week from the Federal Reserve. Wall Street lost ground as edgy investors waited for the Fed’s monetary policy guidance.

 

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
00:00 New Zealand ANZ Business Confidence (DEC) Low     -37.1
00:00 New Zealand ANZ Activity Outlook (DEC) Medium     7.6
00:30 RBA Dec. Meeting Minutes (DEC 4) Medium      
06:45 Switzerland SECO Dec. 2018 Economic Forecasts Low      
09:00 German IFO Business Climate (DEC) Medium   101.7 102
09:00 German IFO Expectations (DEC) Medium   98.3 98.7
09:00 German IFO Current Assessment (DEC) Medium   104.9 105.4
13:30 Canada Manufacturing Sales (MoM) (OCT) Low   0.5% 0.2%
13:30 U.S Housing Starts (MoM) (NOV) Medium   0.2% 1.5%
13:30 U.S Building Permits (MoM) (NOV) Medium   -0.4% -0.6%
20:00 New Zealand Westpac Consumer Confidence (4Q) Medium     103.5
21:45 New Zealand Current Account GDP Ratio YTD (3Q) Medium   -3.6% -3.3%
23:30 Australia Westpac Leading Index (MoM) (NOV) Medium     0.08%
23:50 Japan Trade Balance (NOV) Medium   -¥630.0b -¥449.3b

Euro

The single currency clawed itself off recent lows yesterday as the dollar paused near 18-month highs and traders waited to see whether the U.S. Federal Reserve’s policy meeting this week would calm nerves about slowing global economic growth. Last week the dollar enjoyed its best weekly performance since September. Overall, the EUR/USD traded with a low of 1.1301 and a high of 1.1356 before closing the day around 1.1346 in the New York session.

 

Yen

The Japanese Yen gained ground in yesterday’s trading session. It was a quiet start to the week, with no Japanese events. In the U.S, the Empire State Manufacturing Index dropped sharply to 10.9, down from 23.3 points. This was well short of the estimate of 20.1 points. Today, the U.S releases housing starts and building permits. Overall, the USD/JPY traded with a low of 112.66 and a high of 113.50 before closing the day around 112.81 in the U.S session.

 

British Pound

The British Pound edged off 20-month lows on Monday as British Prime Minister Theresa May rescheduled a delayed vote in parliament on her Brexit plan for mid-January. Sterling inched higher as May confirmed the vote – postponed last week in the face of deep opposition – would happen in the week starting on Jan. 14. Overall, the GBP/USD traded with a low of 1.2572 and a high of 1.2644 before closing the day at 1.2621 in the New York session.

 

Canadian Dollar

The Canadian Dollar weakened, underperforming most other G10 currencies as lingering worries about global growth weighed on stocks ahead of a potential interest rate hike this week from the Fed. Canada exports many commodities, including oil, so its economy could be hurt by slower global growth. U.S crude prices were down 0.2 per cent at $51.12 a barrel. Overall, USD/CAD traded with a low of 1.3370 and a high of 1.3418 before closing the day at 1.3403 in the New York session.

 

Australian Dollar

The Australian Dollar revival of fortunes against its US cousin goes on, underpinned as it has been since its November beginnings by a key factor which is a hope for a trade rapprochement between Washington and Beijing. China is the prime customer of Australia’s vast raw-material export machine, while the U.S is an indispensable partner for Canberra on security matters. Overall, AUD/USD traded with a low of 0.7166 and a high of 0.7185 before closing the day at 0.7175 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 44 and lies below the neutral zone. In general, the pair has lost 0.07%.

 

Sterling-Yen

Currently, GBP/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is indicating a bearish stance. The Relative Strength Index is above 38 reading and lies below the neutral zone. On the whole, the pair has lost 0.18%.

 

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 42 reading and lies below the neutral region. In general, the pair has lost 0.45%.

 

Euro-Sterling

This cross is currently trading above 14, 50 and below 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 60 and lies above the neutral region. On the whole, the pair has gained 0.11%.

 

Sterling-Swiss

This cross is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is indicating a bearish tone. The Relative Strength Index is above 37 and lies below the neutral region. In general, the pair has lost 0.28%.

 

Appendix

  

FOREX Closing Prices for December 17, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.1306 1.13567 1.13015 1.1346 0.0045
USD/JPY 113.37 113.502 112.663 112.813 -0.5350
GBP/USD 1.2589 1.26447 1.25724 1.26212 0.0043
USD/CHF 0.9977 0.99855 0.99154 0.99275 -0.0060
USD/CAD 1.33823 1.34184 1.33703 1.34035 0.0014
EUR/JPY 128.197 128.567 127.842 128.014 -0.0920
GBP/JPY 142.739 143.207 142.135 142.339 -0.2530
CHF/JPY 113.608 114.138 113.469 113.59 0.1280
AUD/JPY 81.341 81.468 80.798 80.955 -0.3700
EUR/GBP 0.89786 0.90029 0.89713 0.89915 0.0010
EUR/CHF 1.12827 1.12893 1.1246 1.12653 -0.0022
GBP/CHF 1.2562 1.25728 1.24995 1.25284 -0.0035

  

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1258 1.1280 1.1313 1.1335 1.1368 1.1390 1.1423
USD/JPY 111.64 112.15 112.48 112.99 113.32 113.83 114.16
GBP/USD 1.2509 1.2540 1.2581 1.2613 1.2653 1.2685 1.2725
USD/CHF 0.9830 0.9873 0.9900 0.9943 0.9970 1.0013 1.0040
USD/CAD 1.3328 1.3349 1.3376 1.3397 1.3425 1.3446 1.3473
EUR/JPY 126.99 127.42 127.72 128.14 128.44 128.87 129.17
GBP/JPY 140.84 141.49 141.91 142.56 142.99 143.63 144.06
CHF/JPY 112.66 113.06 113.33 113.73 114.00 114.40 114.66
AUD/JPY 80.01 80.40 80.68 81.07 81.35 81.74 82.02
EUR/GBP 0.8943 0.8957 0.8974 0.8989 0.9006 0.9020 0.9037
EUR/CHF 1.1201 1.1224 1.1244 1.1267 1.1288 1.1310 1.1331
GBP/CHF 1.2421 1.2460 1.2494 1.2534 1.2568 1.2607 1.2641

 

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.

 

 

17 Dec 2018

FOREX Newsletter

FOREX Newsletter

December 17, 2018

 

Pulse of the Market

·      The Dollar was higher on Friday as investors turned their focus to the expected Fed rate increase

·      It seems unlikely that May’s party will support her agreement with Brussels on leaving the EU

·      The Euro weakened as the euro zone economy showed more signs of a slowdown

·      The Canadian Dollar lost ground against its broadly stronger U.S counterpart on Friday

 

 

The U.S Dollar shone on Friday, reaching a 19-month high against a basket of currencies, as investors preferred the safety of the world’s reserve currency in the wake of worrisome political and economic news outside the United States. The Chinese Yuan fell after data showed retail sales grew in November at their slowest pace since 2003 and industrial output rose the least in nearly three years. The offshore Yuan shed 0.38 percent at 6.9038 per dollar. The euro weakened as the euro zone economy showed more signs of a slowdown. Sterling tumbled as traders worried British Prime Minister Theresa May was struggling to secure assurances from the EU over her Brexit withdrawal deal. The dollar is not so much rallying as much as everyone else is falling. The greenback’s appeal increased in the aftermath of upbeat data on domestic retail sales and industrial output. The Dollar’s gains were limited by bets the Federal Reserve might reduce the number of interest rate increases after a widely expected hike next week. The futures market implied traders saw an 82 percent chance the U.S central bank would increase key short-term rates by a quarter point to 2.25-2.50 percent at its policy meeting next Tuesday and Wednesday, up from 79 percent on Thursday. The market is skeptical about the U.S. economy and whether the Fed would hike further after December. The greenback was also held back by the probability of a partial government shutdown as U.S. President Donald Trump and federal lawmakers disagree over funding for a border wall, analysts said. The euro was down 0.5 percent at $1.12965 after German data showed private-sector expansion slowed to a four-year low in December. French business activity unexpectedly contracted, further fanning fears about slowing growth in the euro area. Worries about the European economy were also stoked by uncertainty whether May could convince the British parliament to approve her Brexit deal. The Canadian Dollar lost ground against its broadly stronger U.S. counterpart on Friday as investors worried about signs of slower global growth and braced for a potential interest rate hike next week from the Federal Reserve. Weak data from China and Europe stoked fears of a global economic slowdown, pressuring stocks and the price of oil, one of Canada’s major exports. U.S. crude oil futures settled 2.6 percent lower$51.20 a barrel.

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
00:01 U.K Rightmove House Prices (YoY) (DEC) Medium      
04:00 Japan Tokyo Condominium Sales (YoY) (NOV) Low      
09:00 Switzerland Total Sight Deposits CHF (DEC 14) Low      
10:00 Euro-Zone Trade Balance (euros) (OCT) Low      
10:00 Euro-Zone Consumer Price Index (YoY) (NOV) Medium     2.2%
13:30 Canada International Securities Transactions (Canadian dollar) (OCT) Low      
13:30 U.S Empire Manufacturing (DEC) Low      
14:00 Canada Existing Home Sales (MoM) (NOV) Medium      
15:00 U.S NAHB Housing Market Index (DEC) Medium      
21:00 U.S Net Long-term TIC Flows (OCT) Medium      

 

Euro

The single currency weakened as the euro zone economy showed more signs of a slowdown. The euro was down 0.5 percent after German data showed private-sector expansion slowed to a four-year low in December. French business activity unexpectedly contracted, further fanning fears about slowing growth in the euro area. Overall, the EUR/USD traded with a low of 1.1268 and a high of 1.1363 before closing the day around 1.1300 in the New York session.

 

Yen

The Japanese Yen pair closed lower on Friday as extreme weakness in the global equity markets encouraged investors to seek shelter in the safe-haven Japanese Yen. Sellers hit the equity markets hard early in the session following the release of weaker-than-expected retail sales and industrial production from China. Overall, the USD/JPY traded with a low of 113.19 and a high of 113.65 before closing the day around 113.34 in the U.S session.

 

British Pound

The British Pound continues to slide during trading on Friday, as the relief rally after Teresa May avoided a no-confidence vote has been completely wiped out. She went to Brussels, and they offered her nothing in return. The odds of a hard Brexit are increasing by the day. Ultimately, I think that the market continues to offer short-term selling opportunities. Overall, the GBP/USD traded with a low of 1.2527 and a high of 1.2662 before closing the day at 1.2578 in the New York session.

 

Canadian Dollar

The Canadian Dollar lost ground against its broadly stronger U.S counterpart on Friday as investors worried about signs of slower global growth and braced for a potential interest rate hike next week from the Federal Reserve. It has been a risk-off day for sure and that ties into the weaker-than-expected Chinese data. Overall, USD/CAD traded with a low of 1.3344 and a high of 1.3399 before closing the day at 1.3389 in the New York session.

 

Australian Dollar

The Australian Dollar plunged on Friday on concerns about a weakening economy in China and Europe. The selling was fueled by safe-haven flows into the U.S Dollar as risk appetite weakened following softer-than-expected economic data from China and the Euro Zone. China released reports showing economic activity in the world’s second largest economy mostly slowed in November. Overall, AUD/USD traded with a low of 0.7149 and a high of 0.7226 before closing the day at 0.7174 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 45 and lies below the neutral zone. In general, the pair has lost 0.73%.

 

Sterling-Yen

Currently, GBP/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is indicating a bearish stance. The Relative Strength Index is above 40 reading and lies below the neutral zone. On the whole, the pair has lost 0.84%.

 

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 45 reading and lies above the neutral region. In general, the pair has lost 0.90%.

 

Euro-Sterling

This cross is currently trading above 14, 50 and below 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 59 and lies above the neutral region. On the whole, the pair has gained 0.10%.

 

Sterling-Swiss

This cross is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is indicating a bearish tone. The Relative Strength Index is above 38 and lies below the neutral region. In general, the pair has lost 0.15%.

 

Appendix

  

FOREX Closing Prices for December 14, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.13607 1.13635 1.12684 1.13008 -0.0055
USD/JPY 113.58 113.656 113.195 113.348 -0.2490
GBP/USD 1.26541 1.26623 1.25277 1.25782 -0.0080
USD/CHF 0.99387 0.99876 0.99321 0.99871 0.0049
USD/CAD 1.33473 1.33992 1.33448 1.3389 0.0038
EUR/JPY 129.055 129.111 127.961 128.106 -0.9420
GBP/JPY 143.763 143.837 142.352 142.592 -1.2110
CHF/JPY 114.257 114.335 113.454 113.462 -0.7940
AUD/JPY 82.069 82.112 81.22 81.325 -0.7410
EUR/GBP 0.89738 0.9003 0.89593 0.8982 0.0009
EUR/CHF 1.12914 1.12925 1.12395 1.12873 -0.0005
GBP/CHF 1.2579 1.25853 1.2497 1.25634 -0.0019

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1163 1.1216 1.1258 1.1311 1.1353 1.1406 1.1449
USD/JPY 112.68 112.94 113.14 113.40 113.60 113.86 114.07
GBP/USD 1.2382 1.2455 1.2517 1.2589 1.2651 1.2724 1.2786
USD/CHF 0.9895 0.9913 0.9950 0.9969 1.0006 1.0024 1.0061
USD/CAD 1.3302 1.3323 1.3356 1.3378 1.3411 1.3432 1.3465
EUR/JPY 126.52 127.24 127.67 128.39 128.82 129.54 129.97
GBP/JPY 140.53 141.44 142.02 142.93 143.50 144.41 144.99
CHF/JPY 112.28 112.87 113.17 113.75 114.05 114.63 114.93
AUD/JPY 80.10 80.66 80.99 81.55 81.88 82.44 82.78
EUR/GBP 0.8916 0.8938 0.8960 0.8981 0.9004 0.9025 0.9047
EUR/CHF 1.1201 1.1220 1.1254 1.1273 1.1307 1.1326 1.1360
GBP/CHF 1.2424 1.2460 1.2512 1.2549 1.2600 1.2637 1.2688

 

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.

 

 

14 Dec 2018

FOREX Newsletter

FOREX Newsletter

December 14, 2018

 

Pulse of the Market

·      U.S unemployment claims dropped to 206 thousand, well below the estimate of 226 thousand

·      U.S inflation was flat in November, dropping from 0.3 percent a month earlier

·      UK Prime Minister Theresa May survived a vote of no confidence yesterday

·      ECB kept its primary rate target at -0.40 percent and marked down its outlook on regional growth

The U.S Dollar was higher yesterday, as the number of people who filed for first-time unemployment benefits hit a two-and-a-half month low. The U.S Dollar index, which measures the greenback’s strength against a basket of six major currencies, rose 0.19% to 97.20. The dollar was boosted after the U.S Department of Labor said that the number of individuals applying for initial jobless benefits in the seven days ended Dec. 8 decreased by 27,000 to a seasonally adjusted 206,000. Meanwhile the pound was slightly higher after UK Prime Minister Theresa May survived a vote of no confidence on Wednesday evening. Brexit woes continue despite the victory, as it seems unlikely that May’s party will support her agreement with Brussels on leaving the European Union in March. The euro fell against the dollar yesterday after the European Central Bank as expected halted new bond purchases and promised to maintain policy support for the euro zone due to risks from trade tensions, Brexit and budget woes in Italy and France. On the other hand, ECB kept its primary rate target at -0.40 percent. It also marked down its outlook on regional growth. Sterling held steady following UK Prime Minister Theresa May’s prevailing in her party’s vote on her leadership the previous day. Traders’ attempt to extend sterling’ gains faded on uncertainty on what more May, who is currently in Brussels, could get from EU leaders to improve on her Brexit proposal. On Monday, May scrapped a parliamentary vote on her current plan, sending the pound to a 20-month low against the dollar and triggering a no-confidence vote on her leadership. The Canadian dollar edged lower against its U.S counterpart yesterday, paring some of the previous day’s gains as oil prices fell and the greenback broadly climbed. The price of oil, one of Canada’s major exports, fell after data on Wednesday showed a smaller-than-expected drawdown in U.S crude stockpiles. U.S crude oil futures were down 0.6 per cent at $50.86 a barrel.

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
  Summit of EU Leaders High      
00:30 Nikkei Japan PMI Manufacturing (DEC) Medium     52.2
02:00 China Retail Sales (YoY) (NOV) Medium   8.8% 8.6%
02:00 China Industrial Production (YoY) (NOV) Medium   5.9% 5.9%
04:30 Japan Industrial Production (YoY) (OCT) Medium     4.2%
08:30 Markit/BME Germany Manufacturing PMI (DEC) Medium   51.7 51.8
09:00 Markit Eurozone Manufacturing PMI (DEC) Medium   51.8 51.8
13:30 U.S Retail Sales Advance (MoM) (NOV) High   0.1% 0.8%
13:30 U.S Retail Sales Ex Auto and Gas (NOV) Medium   0.4% 0.3%
13:30 U.S Retail Sales Control Group (NOV) Medium   0.5% 0.3%
14:15 U.S Industrial Production (MoM) (NOV) Medium   0.3% 0.1%
14:15 U.S Manufacturing (SIC) Production (NOV) Medium   0.3% 0.3%
14:45 Markit US Manufacturing PMI (DEC) Medium   55.1 55.3
14:45 Markit US Services PMI (DEC) Medium   55 54.7
18:00 Baker Hughes U.S. Rig Count (DEC 14) Medium     1075

 

Euro

The single currency fell against the Dollar yesterday after the European Central Bank as expected halted new bond purchases and promised to maintain policy support for the euro zone due to risks from trade tensions, Brexit and budget woes in Italy and France. ECB kept its primary rate target at -0.40%. It also marked down its outlook on regional growth. Overall, the EUR/USD traded with a low of 1.1329 and a high of 1.1392 before closing the day around 1.1356 in the New York session.

 

Yen

The Japanese Yen moved lower in yesterday’s trading session. In the U.S, unemployment claims dropped sharply to 206 thousand, well below the estimate of 226 thousand. Japan’s manufacturing sector is being squeezed by the ongoing U.S-China trade war, which is having a chilling effect on the Japanese economy. Overall, the USD/JPY traded with a low of 113.18 and a high of 113.68 before closing the day around 113.59 in the U.S session.

 

British Pound

The British Pound held steady following UK Prime Minister Theresa May’s prevailing in her party’s vote on her leadership the previous day. It had rallied on Wednesday in anticipation as traders bet her win might allow her to negotiate more generous terms for Britain in its exit from the European Union in March. Overall, the GBP/USD traded with a low of 1.2608 and a high of 1.2684 before closing the day at 1.2657 in the New York session.

 

Canadian Dollar

The Canadian Dollar edged lower against its U.S counterpart yesterday, paring some of the previous day’s gains as oil prices fell and the greenback broadly climbed. The U.S dollar rose against a basket of major currencies after the European Central Bank trimmed its growth and inflation projections for next year, pressuring the euro. Overall, USD/CAD traded with a low of 1.3336 and a high of 1.3381 before closing the day at 1.3351 in the New York session.

 

Australian Dollar

The Australian Dollar is holding near a one-week high as riskier assets are boosted by signs of progress in Sino-US trade relations. But most of the action in the forex world was in the British pound with most other currencies bystanders amid high political drama in Britain, where Prime Minister Theresa May survived a no-confidence vote on her leadership. Overall, AUD/USD traded with a low of 0.7210 and a high of 0.7244 before closing the day at 0.7228 in the New York session.

 

Euro-Yen

EUR/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also issuing a bullish stance. The Relative Strength Index is above 52 and lies below the neutral zone. In general, the pair has gained 0.22%.

 

Sterling-Yen

Currently, GBP/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is indicating a bearish stance. The Relative Strength Index is above 45 reading and lies below the neutral zone. On the whole, the pair has gained 0.57%.

 

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 51 reading and lies above the neutral region. In general, the pair has gained 0.40%.

 

Euro-Sterling

This cross is currently trading above 14, 50 and below 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 59 and lies above the neutral region. On the whole, the pair has lost 0.30%.

  

Sterling-Swiss

This cross is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is indicating a bearish tone. The Relative Strength Index is above 39 and lies below the neutral region. In general, the pair has gained 0.31%.

 

Appendix

  

FOREX Closing Prices for December 13, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.1368 1.1392 1.13297 1.13563 -0.0011
USD/JPY 113.291 113.689 113.186 113.597 0.3320
GBP/USD 1.26258 1.26846 1.26083 1.26577 0.0032
USD/CHF 0.99334 0.99525 0.99098 0.9938 0.0005
USD/CAD 1.33487 1.33816 1.3336 1.33514 0.0003
EUR/JPY 128.802 129.231 128.685 129.048 0.2840
GBP/JPY 143.056 143.909 142.867 143.803 0.8110
CHF/JPY 114.027 114.418 113.937 114.256 0.2620
AUD/JPY 81.797 82.174 81.657 82.066 0.3300
EUR/GBP 0.90025 0.90129 0.89504 0.89733 -0.0027
EUR/CHF 1.12937 1.12999 1.12637 1.12924 0.0000
GBP/CHF 1.25425 1.25897 1.25289 1.25822 0.0039

  

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1264 1.1297 1.1327 1.1359 1.1389 1.1422 1.1451
USD/JPY 112.79 112.99 113.29 113.49 113.80 113.99 114.30
GBP/USD 1.2540 1.2574 1.2616 1.2650 1.2692 1.2727 1.2768
USD/CHF 0.9872 0.9891 0.9914 0.9933 0.9957 0.9976 1.0000
USD/CAD 1.3285 1.3311 1.3331 1.3356 1.3377 1.3402 1.3422
EUR/JPY 128.20 128.44 128.75 128.99 129.29 129.53 129.84
GBP/JPY 142.10 142.48 143.14 143.53 144.19 144.57 145.23
CHF/JPY 113.51 113.72 113.99 114.20 114.47 114.68 114.95
AUD/JPY 81.24 81.45 81.76 81.97 82.27 82.48 82.79
EUR/GBP 0.8882 0.8916 0.8945 0.8979 0.9007 0.9041 0.9070
EUR/CHF 1.1235 1.1249 1.1271 1.1285 1.1307 1.1322 1.1343
GBP/CHF 1.2483 1.2506 1.2544 1.2567 1.2605 1.2628 1.2666

 

 

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.

 

 

13 Dec 2018

FOREX Newsletter

FOREX Newsletter

December 13, 2018


 

Pulse of the Market

·      U.S consumer inflation reports softened in November, but matched the estimates

·      The ongoing U.S-China trade war has had a chilling effect on the Japanese manufacturing sector

·      The likely outcome of Friday’s summit are a blow to German Finance Minister Olaf Scholz

·      The Canadian Dollar gained against the U.S Dollar, boosted by higher oil prices

 

The U.S Dollar was lower yesterday, as inflation data underlined expectations that the Federal Reserve will slow its pace of rate hikes in 2019. The Labor Department said its consumer price index was unchanged from a month earlier, slowing from the 0.3% increase seen in October. Analysts had forecast a 0.1% increase. The U.S Dollar index, which measures the greenback’s strength against a basket of six major currencies, fell 0.3% to 97.09. The dollar has been under pressure recently amid expectations that the Fed will pause its pace of interest rate hikes next year, despite an expected rate increase next week. The British pound has rallied amid speculation Theresa May can survive the vote of confidence against her, lowering the chances of a hard Brexit leader winning control of the ruling Conservative party. In the latest twist for sterling in a turbulent week, the pound rose to $1.2620 against the dollar and €1.1121 against the euro, as more than 150 Conservative MPs said they would vote for the PM. Business leaders reacted angrily to the fresh turmoil in Westminster, saying the latest uncertainty was bad for the economy. The US Dollar has been grinding higher against the Japanese yen for some time, but every time we get close to the ¥114 level, we pull back a bit and it looks likely that the uptrend underneath should continue to offer support. Ultimately, this is a market that should eventually make a decision, but it may not be until 2019 that it happens. Japanese Core Machinery Orders rebounded with a gain of 7.6%, but fell short of the forecast of 10.2%. Japanese PPI continues to lose ground, and dropped from 2.9% to 2.3%. This missed the estimate of 2.4%. The Canadian Dollar was boosted by higher oil prices and investor optimism over trade negotiations between the United States and China. Canada exports many commodities, including oil, and runs a current account deficit, so its economy stands to benefit if the outlook improves for the global flow of trade and capital.

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
00:00 Australia Consumer Inflation Expectation (DEC) Medium 3.6%
00:01 U.K RICS House Price Balance (NOV) Medium -10.0% -10.0%
07:00 German Consumer Price Index (YoY) (NOV) Medium 2.3% 2.3%
08:30 SNB Sight Deposit Interest Rate (DEC 13) High -0.75% -0.75%
09:00 SNB’s Jordan Speaks at Press Conference in Bern High
12:45 European Central Bank Rate Decision (DEC 13) High 0.00% 0.00%
12:45 ECB Marginal Lending Facility (DEC 13) High 0.25% 0.25%
12:45 ECB Deposit Facility Rate (DEC 13) High -0.40% -0.40%
13:30 Canada New Housing Price Index (YoY) (OCT) Medium 0.1% 0.2%
13:30 U.S Export Price Index (YoY) (NOV) Medium 3.1%
13:30 U.S Import Price Index ex Petroleum (MoM) (NOV) Medium 0.0% 0.2%
13:30 U.S Initial Jobless Claims (DEC 8) Medium 225k 231k
19:00 U.S Monthly Budget Statement (NOV) Medium -$197.0b -$100.5b
23:50 Japan Tankan Large Manufacturing Index (4Q) Medium 18 19

Euro

The single currency gained in yesterday’s session. European Union leaders will ditch proposals to use a euro zone budget for economic stabilization and restrict any funds to long-standing EU goals of convergence among their economies and increasing competitiveness, draft summit conclusions showed yesterday. Overall, the EUR/USD traded with a low of 1.1313 and a high of 1.1386 before closing the day around 1.1366 in the New York session.

 

Yen

The Japanese Yen posted small gains yesterday. On the release front, Japanese Core Machinery Orders rebounded with a gain of 7.6%, but fell short of the forecast of 10.2%. Japanese PPI continues to lose ground, and dropped from 2.9% to 2.3%. In the U.S, consumer inflation reports softened in November, but matched the estimates. Overall, the USD/JPY traded with a low of 113.12 and a high of 113.50 before closing the day around 113.26 in the U.S session.

 

British Pound

The British Pound rallied amid speculation Theresa May can survive the vote of confidence against her, lowering the chances of a hard Brexit leader winning control of the ruling Conservative party. Sterling rose by more than 1% against the dollar and by 0.8% against the euro yesterday after Tory rebels triggered the vote on May’s leadership of their party. Overall, the GBP/USD traded with a low of 1.2475 and a high of 1.2670 before closing the day at 1.2625 in the New York session.

 

Canadian Dollar

The Canadian Dollar strengthened against its U.S. counterpart, boosted by higher oil prices and investor optimism over trade negotiations between the United States and China. U.S. President Donald Trump, in an interview with Reuters, said that trade talks with Beijing were under way by telephone, with more meetings likely between U.S and Chinese officials.  Overall, USD/CAD traded with a low of 1.3320 and a high of 1.3395 before closing the day at 1.3348 in the New York session.

 

Australian Dollar

The Australian Dollar rose along with global equities as tentative signs of easing Sino-US trade tensions whetted risk appetite. A gauge of Asia-Pacific shares outside Japan jumped 0.9 per cent while US stock futures were upbeat too. Risk appetite got a boost after U.S President Donald Trump said trade talks with Beijing were already underway, with more meetings likely among US and Chinese officials. Overall, AUD/USD traded with a low of 0.7196 and a high of 0.7236 before closing the day at 0.7217 in the New York session.

 

Euro-Yen

EUR/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also issuing a bullish stance. The Relative Strength Index is above 50 and lies below the neutral zone. In general, the pair has gained 0.38%.

 

Sterling-Yen

Currently, GBP/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is indicating a bearish stance. The Relative Strength Index is above 41 reading and lies below the neutral zone. On the whole, the pair has gained 1.00%.

  

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 48 reading and lies below the neutral region. In general, the pair has gained 0.09%.

 

Euro-Sterling

This cross is currently trading above 14, 50 and below 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 61 and lies above the neutral region. On the whole, the pair has lost 0.67%.

 

Sterling-Swiss

This cross is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is indicating a bearish tone. The Relative Strength Index is above 37 and lies below the neutral region. In general, the pair has gained 1.15%.

 

Appendix

  

FOREX Closing Prices for December 12, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.13153 1.1386 1.13137 1.13669 0.0051
USD/JPY 113.356 113.502 113.121 113.265 -0.0900
GBP/USD 1.2485 1.26704 1.24753 1.26256 0.0139
USD/CHF 0.9931 0.99637 0.99112 0.99331 0.0002
USD/CAD 1.339 1.33951 1.332 1.33485 -0.0039
EUR/JPY 128.29 128.842 128.275 128.764 0.4910
GBP/JPY 141.536 143.421 141.497 142.992 1.4210
CHF/JPY 114.111 114.362 113.796 113.994 -0.1190
AUD/JPY 81.628 82.029 81.589 81.736 0.0750
EUR/GBP 0.90612 0.90673 0.89668 0.90005 -0.0061
EUR/CHF 1.12397 1.12952 1.12325 1.1292 0.0053
GBP/CHF 1.24002 1.258 1.23961 1.25432 0.0142

  

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1253 1.1283 1.1325 1.1356 1.1397 1.1428 1.1470
USD/JPY 112.71 112.92 113.09 113.30 113.47 113.68 113.85
GBP/USD 1.2315 1.2395 1.2510 1.2590 1.2706 1.2786 1.2901
USD/CHF 0.9856 0.9884 0.9908 0.9936 0.9961 0.9989 1.0013
USD/CAD 1.3239 1.3279 1.3314 1.3355 1.3389 1.3430 1.3464
EUR/JPY 127.85 128.06 128.41 128.63 128.98 129.19 129.55
GBP/JPY 139.93 140.71 141.85 142.64 143.78 144.56 145.70
CHF/JPY 113.17 113.48 113.74 114.05 114.31 114.62 114.87
AUD/JPY 81.10 81.34 81.54 81.78 81.98 82.22 82.42
EUR/GBP 0.8855 0.8911 0.8956 0.9012 0.9056 0.9112 0.9157
EUR/CHF 1.1189 1.1211 1.1251 1.1273 1.1314 1.1336 1.1377
GBP/CHF 1.2249 1.2323 1.2433 1.2506 1.2617 1.2690 1.2801

 

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.

 

 

11 Dec 2018

FOREX Newsletter

 

FOREX Newsletter

 December 11, 2018

 

Pulse of the Market

·      The Greenback strengthened versus a basket of currencies yesterday that includes the Euro

·      Sentix research group said its investor sentiment index for the euro zone slid to -0.3 from 8.8

·      British Prime Minister Theresa May postponed a parliamentary vote on her Brexit deal

·      Japan’s current account surplus dropped sharply to JPY 1.21 trillion, down from 1.33 trillion

 

The U.S Dollar was higher yesterday, as the pound tumbled amid reports that UK Prime Minister is cancelling a vote on Tuesday on the Brexit draft proposal. The pound slid to its weakest level in nearly 1-1/2 years against the dollar on Monday as British Prime Minister Theresa May postponed a parliamentary vote on her Brexit deal, rekindling doubts about U.K.’s departure from the European Union in March. The greenback enjoyed a mild recovery following its steepest weekly drop versus a basket of currencies in three months last week, as traders reduced their expectations that the Federal Reserve might pause its interest rate hikes sooner than previously thought. On Sunday Chinese officials summoned the U.S. ambassador to Beijing to protest the arrest of the chief financial officer of Chinese electronics giant Huawei, Meng Wanzhou, in Canada. U.S officials are investigating her role in the company’s operations in Iran. The arrest of Meng has added to tensions between the two biggest economic countries in the world. U.S President Donald Trump and Chinese President Xi Jinping agreed on Dec. 1 to a 90-day truce on trade tariffs. Still, U.S. Trade Representative Robert Lighthizer said on Sunday there is a “hard deadline”, noting U.S.-China trade negotiations need to reach a successful end by March 1. The euro hit a three-month peak versus the pound at 90.47 pence. It was last up 0.77 percent at 90.22 pence. The Japanese yen was down in yesterday’s trading session. On the release front, Japan’s current account surplus dropped sharply to JPY 1.21 trillion, down from 1.33 trillion. This missed the estimate of JPY 1.29 trillion. Japanese Final GDP declined 0.6%, missing the estimate of 0.5%. In the U.S, JOLTS Job Openings improved to 7.08 million, but was well short of the estimate of 7.22 million. Today, Japan releases manufacturing data, while the U.S releases Producer Price Index reports. The new trading week started with dismal Japanese data, as Final GDP in the third quarter declined 0.6%.

 

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
00:30 Australia NAB Business Confidence (NOV) Medium     4
00:30 Australia House Price Index (YoY) (3Q) Low   -2.0% -0.6%
06:00 Japan Machine Tool Orders (YoY) (NOV) Medium     -0.7%
09:30 U.K Claimant Count Rate (NOV) Medium     2.7%
09:30 U.K Jobless Claims Change (NOV) Medium     20.2k
09:30 U.K Average Weekly Earnings (3M/YoY) (OCT) Medium   3.0% 3.0%
09:30 U.K Employment Change 3M/3M (OCT) Medium   25k 23k
10:00 German ZEW Survey Current Situation (DEC) Medium   55 58.2
10:00 German ZEW Survey Expectations (DEC) High   -25 -24.1
10:00 Euro-Zone ZEW Survey (Economic Sentiment) (DEC) High     -22
11:00 U.S NFIB Small Business Optimism (NOV) Low   107 107.4
13:30 U.S PPI Final Demand (YoY) (NOV) Low   2.5% 2.9%
19:15 RBNZ’s Orr at Parliament Committee on Annual Report High      
23:50 Japan Machine Orders (YoY) (OCT) Medium   5.0% -7.0%

 

Euro

The single currency fell as investor morale in the euro zone slumped to a four-year low in December as fears about trade conflicts, Italy’s budget row with the European Union and Brexit led to a collapse in sentiment, a survey showed. Sentix research group said its investor sentiment index for the euro zone slid to -0.3 from 8.8 in November. Overall, the EUR/USD traded with a low of 1.1349 and a high of 1.1441 before closing the day around 1.1354 in the New York session.

 

Yen

The Japanese Yen was down yesterday. On the release front, Japan’s current account surplus dropped sharply to JPY 1.21 trillion, down from 1.33 trillion. This missed the estimate of JPY 1.29 trillion. Japanese Final GDP declined 0.6%, missing the estimate of 0.5%. In the U.S, JOLTS Job Openings improved to 7.08 million. Overall, the USD/JPY traded with a low of 112.22 and a high of 113.34 before closing the day around 113.31 in the U.S session.

 

British Pound

The British Pound slid to its weakest level in nearly 1-1/2 years against the Dollar yesterday as British Prime Minister Theresa May postponed a parliamentary vote on her Brexit deal, rekindling doubts about U.K’s departure from the European Union in March. The greenback enjoyed a mild recovery following its steepest weekly drop. Overall, the GBP/USD traded with a low of 1.2504 and a high of 1.2757 before closing the day at 1.2560 in the New York session.

 

Canadian Dollar

The Canadian Dollar edged lower against its U.S. counterpart yesterday as oil prices declined and the spread between Canada’s two- and five-year yields turned negative for the first time since September 2007. The five-year yield fell 0.6 basis points below the two-year yield. U.S crude prices were down 2.3 per cent at $51.4 a barrel.  Overall, USD/CAD traded with a low of 1.3290 and a high of 1.3414 before closing the day at 1.3395 in the New York session.

 

Australian Dollar

The Australian Dollar continues to slide, falling to the lowest level in a month yesterday. A combination of heightened risk aversion and soft economic data from Australia, the United States and China has taken its toll on the Aussie dollar so far in December. Chinese CPI and PPI also undershot market expectations. Overall, AUD/USD traded with a low of 0.7176 and a high of 0.7224 before closing the day at 0.7185 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 47 and lies below the neutral zone. In general, the pair has gained 0.15%.

 

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 also indicating a bearish stance. The Relative Strength Index is above 34 reading and lies below the neutral zone. On the whole, the pair has lost 0.81%.

 

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is indicating a bullish stance. The Relative Strength Index is above 44 reading and lies below the neutral region. In general, the pair has gained 0.45%.

 

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 bullish signal. The Relative Strength Index is above 70 and lies above the neutral region. On the whole, the pair has gained 1.00%.

 

Sterling-Swiss

This cross is trading below 14, 50 and 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 24 and lies below the neutral region. In general, the pair has lost 1.32%.

 

Appendix

  

FOREX Closing Prices for December 10, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.13923 1.14413 1.13491 1.13546 -0.0050
USD/JPY 112.624 113.349 112.221 113.314 0.6590
GBP/USD 1.27124 1.27576 1.25049 1.256 -0.0180
USD/CHF 0.99014 0.99098 0.98664 0.99015 0.0008
USD/CAD 1.33265 1.34143 1.32906 1.33953 0.0078
EUR/JPY 128.326 128.915 128.151 128.686 0.1960
GBP/JPY 143.193 143.683 141.15 142.375 -1.1690
CHF/JPY 113.714 114.454 113.565 114.414 0.5790
AUD/JPY 80.999 81.497 80.691 81.457 0.3680
EUR/GBP 0.89604 0.90855 0.89572 0.90389 0.0090
EUR/CHF 1.12835 1.13058 1.1234 1.12437 -0.0041
GBP/CHF 1.25894 1.26079 1.23769 1.24396 -0.0166

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1230 1.1289 1.1322 1.1382 1.1414 1.1474 1.1506
USD/JPY 111.45 111.83 112.57 112.96 113.70 114.09 114.83
GBP/USD 1.2205 1.2355 1.2457 1.2608 1.2710 1.2860 1.2963
USD/CHF 0.9832 0.9849 0.9875 0.9893 0.9919 0.9936 0.9962
USD/CAD 1.3195 1.3243 1.3319 1.3367 1.3443 1.3490 1.3567
EUR/JPY 127.49 127.82 128.25 128.58 129.02 129.35 129.78
GBP/JPY 138.59 139.87 141.12 142.40 143.66 144.94 146.19
CHF/JPY 112.95 113.26 113.83 114.14 114.72 115.03 115.61
AUD/JPY 80.13 80.41 80.93 81.22 81.74 82.02 82.55
EUR/GBP 0.8841 0.8899 0.8969 0.9027 0.9097 0.9156 0.9226
EUR/CHF 1.1145 1.1189 1.1217 1.1261 1.1288 1.1333 1.1360
GBP/CHF 1.2111 1.2244 1.2342 1.2475 1.2573 1.2706 1.2804

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.

 

 

10 Dec 2018

FOREX Newsletter

FOREX Newsletter

December 10, 2018

 

Pulse of the Market

·      The primary theme for the Dollar right now is risk aversion, which can be positive and negative

·      This week’s U.S inflation and retail sales report will be just as important as NFP

·      Keep an eye on US-China headlines as they will also influence risk appetite

·      Canada’s economy is on fire with a record breaking 94.1K jobs created in the month of November

The last month of the year kicked off with a bang but not in the way that many of us would have hoped. Equity markets sold off across the globe and in the world of currencies, the U.S and Australian Dollars were the worst performers. A convergence of negative news pressed both currencies lower but most of the concerns centered on China, which is why AUD fell the hardest. The week started with optimism after President Trump and President Xi reached a trade truce but things went south quickly when the U.S arrested Huawei’s CFO. Stocks crashed and President Trump tried to stem the slide by saying he had no knowledge of the arrest and that trade talks with China are going very well. Investors are skeptical and in a headline driven trading environment they are taking everything at face value. As we muddle through the conflicting headlines, what is clear is that uncertainty will remain in the weeks ahead as investors wait to see if the Huawei arrest really affects US-China trade talks. There’s also a big Brexit vote this week and the ECB meeting. Between these events and a continued focus on China, December will remain a jittery month for currencies. The primary theme in the FX market right now is risk aversion, which can be both positive and negative for the U.S Dollar. When markets sell off globally, money usually flows into the U.S Dollar and the Japanese Yen. With stocks poised for further losses, demand for the yen has been and should remain strong. However demand for the U.S Dollar depends on what is happening in the other currency’s home country. The latest US jobs report is proof that despite the pickup in manufacturing and service sector activity the momentum in the US economy is slowing. Only 155K jobs were created in November versus a forecast for a 198K increase. Payroll growth in October was also revised slightly lower but the concern is wages. Not only did average hourly earnings growth fall short of expectations, rising only 0.2% compared to a forecast of 0.3% but the prior month’s reading was also revised lower to 0.1%. This means that companies are hiring fewer workers, paying them less than expected and allowing them to bill fewer houses.

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
  China New Yuan Loans CNY (NOV) High     697.0b
00:30 Australia Home Loans (MoM) (OCT) Medium     -1.0%
04:30 Japan Bankruptcies (YoY) (NOV) Medium     -0.4%
06:45 Switzerland Unemployment Rate (NOV) Medium     2.4%
07:00 German Trade Balance (OCT) Medium     18.4b
09:30 U.K Trade Balance (OCT) Medium     -£27m
09:30 U.K Industrial Production (YoY) (OCT) Medium     0.0%
09:30 U.K Manufacturing Production (YoY) (OCT) Medium     0.5%
09:30 U.K Gross Domestic Product (MoM) (OCT) Medium     0.0%
13:15 Canada Housing Starts (NOV) Medium     205.9k
13:30 Canada Building Permits (MoM) (OCT) Medium     0.4%
15:00 U.S JOLTS Job Openings (OCT) Low     7009

 

Euro

The single currency gained in Friday’s trading session. Workers in the euro area are seeing the strongest pay gains in a decade, a rare piece of positive economic news for the European Central Bank as it heads toward scaling back extraordinary stimulus. Compensation per employee in the euro area grew an annual 2.5 percent in the third quarter. Overall, the EUR/USD traded with a low of 1.1359 and a high of 1.1422 before closing the day around 1.1404 in the New York session.

 

Yen

The Japanese Yen pair settled almost unchanged on Friday and marginally down for the week. The fundamental background suggests that the pair could break lower this week, as equities are set to remain under pressure, while the benchmark US 10-year Treasury yield fell from 3.02% to 2.85% last week. Overall, the USD/JPY traded with a low of 112.53 and a high of 112.90 before closing the day around 112.65 in the U.S session.

 

British Pound

The British Pound ended the week marginally below the previous week’s close, after UK political uncertainty dragged Sterling lower. In the coming week GBP/USD is forecast to continue its trend lower. The main data release for the U.S Dollar is inflation data out on Wednesday because of its impact on interest rates, a primary driver of currencies. Overall, the GBP/USD traded with a low of 1.2709 and a high of 1.2791 before closing the day at 1.2740 in the New York session.

 

Canadian Dollar

The Canadian Dollar strengthened on Friday after domestic data showing a record increase in jobs caught the foreign exchange market by surprise, pressuring investors who had been short the loonie. The Canadian economy added 94,100 jobs in November on higher full-time hiring, and the unemployment rate dipped to a new all-time low of 5.6 per cent.  Overall, USD/CAD traded with a low of 1.3251 and a high of 1.3398 before closing the day at 1.3317 in the New York session.

 

Australian Dollar

The Australian Dollar has fallen during most of the week but has found support at the crucial 0.72 level. The fact that it has broken above a major downtrend line and held above there is a bullish sign. I think this is due to the US and the Chinese calling a bit of a “cease-fire” in the trade war. Overall, AUD/USD traded with a low of 0.7196 and a high of 0.7240 before closing the day at 0.7197 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 0.27%.

 

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 also indicating a bearish stance. The Relative Strength Index is above 40 reading and lies below the neutral zone. On the whole, the pair has lost 0.33%.

   

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is indicating a bullish stance. The Relative Strength Index is above 42 reading and lies below the neutral region. In general, the pair has gained 0.49%.

  

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 bullish signal. The Relative Strength Index is above 62 and lies above the neutral region. On the whole, the pair has gained 0.60%.

 

 Sterling-Swiss

This cross is trading below 14, 50 and 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 32 and lies below the neutral region. In general, the pair has lost 0.65%.

 

Appendix

  

FOREX Closing Prices for December 07, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.13743 1.14222 1.1359 1.14043 0.0028
USD/JPY 112.648 112.909 112.535 112.655 0.0000
GBP/USD 1.27803 1.2791 1.27092 1.27403 -0.0040
USD/CHF 0.99233 0.99414 0.9888 0.98935 -0.0033
USD/CAD 1.33785 1.33983 1.32514 1.33175 -0.0063
EUR/JPY 128.178 128.65 128.114 128.49 0.3400
GBP/JPY 144.008 144.198 143.21 143.544 -0.4780
CHF/JPY 113.473 113.874 113.38 113.835 0.3780
AUD/JPY 81.5 81.655 81.066 81.089 -0.4030
EUR/GBP 0.8895 0.89659 0.88934 0.89494 0.0054
EUR/CHF 1.12921 1.13077 1.12816 1.12843 -0.0009
GBP/CHF 1.26893 1.26987 1.25919 1.26059 -0.0083

 

  

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1305 1.1332 1.1368 1.1395 1.1431 1.1458 1.1495
USD/JPY 112.12 112.33 112.49 112.70 112.86 113.07 113.24
GBP/USD 1.2621 1.2665 1.2703 1.2747 1.2784 1.2829 1.2866
USD/CHF 0.9820 0.9854 0.9874 0.9908 0.9927 0.9961 0.9981
USD/CAD 1.3100 1.3176 1.3247 1.3322 1.3393 1.3469 1.3540
EUR/JPY 127.65 127.88 128.19 128.42 128.72 128.95 129.26
GBP/JPY 142.12 142.66 143.10 143.65 144.09 144.64 145.08
CHF/JPY 113.02 113.20 113.52 113.70 114.01 114.19 114.51
AUD/JPY 80.30 80.68 80.89 81.27 81.47 81.86 82.06
EUR/GBP 0.8834 0.8864 0.8907 0.8936 0.8979 0.9009 0.9052
EUR/CHF 1.1249 1.1265 1.1275 1.1291 1.1301 1.1317 1.1327
GBP/CHF 1.2459 1.2525 1.2566 1.2632 1.2672 1.2739 1.2779

 

 

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.

 

 

07 Dec 2018

FOREX Newsletter

FOREX Newsletter

December 07, 2018

 

Pulse of the Market

·      The U.S Dollar weakened against major peers yesterday as U.S Treasury yields tumbled

·      Market sentiment was dampened by disappointing ADP payrolls data and higher jobless claims

·      Bank of Canada Governor Stephen Poloz said the economy was weaker than forecast

·      The Australian Dollar slipped for a third straight day on fears of renewed US-China trade tensions

The U.S Dollar was lower yesterday as the arrest of a Huawei executive spooked investors and disappointing jobs data dampened sentiment. The U.S Dollar index, which measures the greenback’s strength against a basket of six major currencies, fell 0.46% to 96.56. Meng Wanzhou, the chief financial officer at the Chinese smartphone company Huawei was arrested in Canada on an extradition request by the U.S, which had been investigating whether or not she violated sanctions against Iran. The arrest happened just one week after President Donald Trump and his Chinese counterpart Xi Jinping agreed to a 90-day trade truce. Investors fear it could derail any potential trade talks between the two countries. Japanese Yen gained after the news as the Yen tends to benefit during geopolitical or financial stress as Japan is the world’s biggest creditor nation and there is an assumption that Japanese investors will repatriate funds should a crisis materialize. Market sentiment was also dampened by disappointing ADP payrolls data and higher than expected jobless claims. Data showed private employers hired fewer workers than expected in November, pointing to a moderation in the pace of job growth. The U.S trade deficit jumped to a 10-year high in October as soybean exports dropped further and imports of consumer goods rose to a record high, suggesting the Trump administration’s tariff-related measures to shrink the trade gap likely have been ineffective. Sterling was 0.42 percent higher on the day even as worry over how a British Parliament vote on Prime Minister Theresa May’s Brexit deal next week remained in focus. The Canadian dollar fell against its U.S counterpart to a nearly 18-month low, as Bank of Canada Governor Stephen Poloz said the economy was weaker than forecast and predicted low oil prices would cut growth. Poloz, speaking a day after the central bank kept interest rates on hold, repeated that more tightening would be needed.

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
00:00 Japan Labor Cash Earnings (YoY) (OCT) Medium   1.0% 1.1%
05:00 Japan Leading Index CI (OCT) Medium   104.9 104.3
07:00 German Industrial Production n.s.a. and w.d.a. (YoY) (OCT) Medium   2.1% 0.8%
09:30 U.K BoE/TNS Inflation Next 12 Mths (NOV) High     3.0%
10:00 Euro-Zone Government Expenditure (QoQ) (3Q) Medium   0.3% 0.4%
10:00 Euro-Zone Gross Domestic Product s.a. (YoY) (3Q) Medium   1.7% 1.7%
13:30 Canada Unemployment Rate (NOV) High   5.8% 5.8%
13:30 Canada Net Change in Employment (NOV) High   10.0k 11.2k
13:30 U.S Change in Non-farm Payrolls (NOV) High   198k 250k
13:30 U.S Change in Private Payrolls (NOV) Medium   200k 246k
13:30 U.S Unemployment Rate (NOV) High   3.7% 3.7%
13:30 U.S Average Hourly Earnings (YoY) (NOV) Medium   3.1% 3.1%
15:00 U.S U. of Mich. Sentiment (DEC) High   97 97.5
18:00 Baker Hughes U.S Rig Count (DEC 7) Medium     1076
20:00 U.S Consumer Credit (OCT) Medium   $15.000b $10.923b

Euro

The single currency gained yesterday against the U.S Dollar as the European Commission has adopted a recommendation to promote the wider use of the euro in international energy agreements and transactions. The aim is to strengthen the role of the single currency on the international financial system. Overall, the EUR/USD traded with a low of 1.1319 and a high of 1.1411 before closing the day around 1.1376 in the New York session.

 

Yen

The Japanese Yen pair weakened yesterday as U.S Treasury yields tumbled and traders scaled back expectations on the number of rate hikes the Federal Reserve would implement amid weakening economic data and heightened market volatility. The benchmark 10-year Treasury yield hit a three-month trough of 2.845 percent. Overall, the USD/JPY traded with a low of 112.21 and a high of 113.18 before closing the day around 112.65 in the U.S session.

 

British Pound

The British Pound posted gains in yesterday’s session. There were no major indicators in the U.K. In the U.S, job employment numbers were soft. ADP nonfarm payrolls plunged to 179 thousand, well off the estimate of 196 thousand. This was the lowest level since May. Unemployment claims edged lower to 231 thousand. Overall, the GBP/USD traded with a low of 1.2697 and a high of 1.2808 before closing the day at 1.2780 in the New York session.

 

Canadian Dollar

The Canadian Dollar fell against its U.S counterpart yesterday to a nearly 18-month low, as Bank of Canada Governor Stephen Poloz said the economy was weaker than forecast and predicted low oil prices would cut growth. Poloz’s comments were likely to reinforce market expectations that the pace of future rate hikes will ease off.  Overall, USD/CAD traded with a low of 1.3352 and a high of 1.3442 before closing the day at 1.3380 in the New York session.

 

Australian Dollar

The Australian Dollar slipped for a third straight session as fears of renewed US-China trade tensions spooked stock markets, while investors toyed with the idea of possible rate cuts at home. Australian two-year bond yields dived to their lowest in nine months at 1.93 per cent. Yesterday’s helping of domestic data did nothing to alter the mood Overall, AUD/USD traded with a low of 0.7189 and a high of 0.7272 before closing the day at 0.7221 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 45 and lies below the neutral zone. In general, the pair has lost 0.19%.

 

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 also indicating a bearish stance. The Relative Strength Index is above 41 reading and lies below the neutral zone. On the whole, the pair has lost 0.06%.

 

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is indicating a bullish stance. The Relative Strength Index is above 44 reading and lies below the neutral region. In general, the pair has lost 0.91%.

  

Euro-Sterling

This cross is currently trading above 14, 50 and below 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 57 and lies above the neutral region. On the whole, the pair has lost 0.13%.

 

Sterling-Swiss

This cross is trading below 14, 50 and 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 38 and lies below the neutral region. In general, the pair has lost 0.10%.

 

Appendix

  

FOREX Closing Prices for December 06, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.13428 1.14112 1.13196 1.13761 0.0033
USD/JPY 113.183 113.189 112.213 112.655 -0.5200
GBP/USD 1.27316 1.28084 1.26977 1.27802 0.0049
USD/CHF 0.99751 0.99882 0.98927 0.99262 -0.0049
USD/CAD 1.33545 1.34423 1.3352 1.33802 0.0028
EUR/JPY 128.386 128.422 127.649 128.15 -0.2430
GBP/JPY 144.126 144.144 143.225 144.022 -0.0870
CHF/JPY 113.434 113.481 112.872 113.457 0.0350
AUD/JPY 82.24 82.285 80.899 81.492 -0.7490
EUR/GBP 0.89069 0.89259 0.88849 0.88958 -0.0012
EUR/CHF 1.13147 1.13199 1.12786 1.12929 -0.0023
GBP/CHF 1.27011 1.2718 1.26481 1.2689 -0.0013

 

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1235 1.1277 1.1327 1.1369 1.1418 1.1461 1.1510
USD/JPY 111.21 111.71 112.18 112.69 113.16 113.66 114.13
GBP/USD 1.2605 1.2651 1.2716 1.2762 1.2827 1.2873 1.2937
USD/CHF 0.9788 0.9840 0.9883 0.9936 0.9979 1.0031 1.0074
USD/CAD 1.3250 1.3301 1.3341 1.3392 1.3431 1.3482 1.3521
EUR/JPY 126.95 127.30 127.73 128.07 128.50 128.85 129.27
GBP/JPY 142.53 142.88 143.45 143.80 144.37 144.72 145.29
CHF/JPY 112.45 112.66 113.06 113.27 113.67 113.88 114.28
AUD/JPY 79.45 80.17 80.83 81.56 82.22 82.94 83.60
EUR/GBP 0.8838 0.8861 0.8879 0.8902 0.8920 0.8943 0.8961
EUR/CHF 1.1233 1.1256 1.1274 1.1297 1.1316 1.1338 1.1357
GBP/CHF 1.2582 1.2615 1.2652 1.2685 1.2722 1.2755 1.2792

 

 

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.

 

 

06 Dec 2018

FOREX Newsletter

FOREX Newsletter

December 06, 2018

 

Pulse of the Market

·      Resurgent fears over the U.S-China trade war sapped demand for riskier assets

·      The Pound remained on the back foot as debate on the government’s Brexit plan continued

·      The Canadian dollar weakened to one-and-a-half-year low against its U.S counterpart

·      Australia’s Q/Q growth fell to 0.3% while domestic demand came in weak

The Dollar was little changed against a currency basket yesterday as resurgent fears over the U.S-China trade war sapped demand for riskier assets, while the pound remained on the back foot as a parliamentary debate on the government’s Brexit plan continued. Wall Street slumped on Tuesday after a series of tweets by U.S President Donald Trump dented investor confidence that a full resolution to the U.S.-China trade conflict will be reached during a 90-day trade truce. Trump threatened to impose higher tariffs on China soon unless they make concessions, exacerbating fears over the outlook for global growth. Worries about U.S bond markets signaling an impending recession also weighed on market sentiment. The U.S dollar index, which measures the greenback’s strength against a basket of six major currencies, was at 96.93. Trading volumes were low, with U.S markets closed for a national day of mourning for President George H. W. Bush. Major currencies retraced some of Tuesday’s action today, as investors processed President Donald Trump’s latest comments on China trade. Meanwhile, the Canadian dollar dropped to a six-month low versus its U.S rival, following a Bank of Canada policy update. While it was expected for the BOC to keep its benchmark interest rates unchanged — with the overnight rate at 1.75% — the central bank’s comments on an anticipated loss of economic momentum in the fourth quarter, as well as weaker oil prices threw the Canadian dollar also referred to colloquially as the loonie, into a tailspin. Reduced business investment on the back of trade tensions over the summer, impacted the outlook for the last three months of the year, the BOC said. U.S-China trade relations remained front and center today after tweets by President Donald Trump on Tuesday caused some turbulence. The Australian dollar fell significantly, after recent ABS figures revealed Australia’s Gross Domestic Product slowed in September, missing expectations.

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
00:30 Australia Trade Balance (OCT) Medium   A$3000m A$3017m
07:00 German Factory Orders n.s.a. (YoY) (OCT) Medium   -3.1% -2.2%
12:30 U.S Challenger Job Cuts (YoY) (NOV) Low     153.6%
13:15 U.S ADP Employment Change (NOV) Medium   195k 227k
13:30 U.S Trade Balance (OCT) Medium   -$55.0b -$54.0b
13:30 U.S Initial Jobless Claims (DEC 1) Medium   225k 234k
13:30 U.S Continuing Claims (NOV 24) Medium   1695k 1710k
15:00 Canada Ivey Purchasing Managers Index s.a. (NOV) Low     61.8
15:00 U.S ISM Non-Manufacturing/Services Composite (NOV) High   59 60.3
15:00 U.S Factory Orders (OCT) Medium   -2.0% 0.7%
15:00 U.S Durable Goods Orders (OCT) Medium   -2.4% -4.4%
16:00 DOE U.S. Crude Oil Inventories (NOV 30) Medium     3577k
23:30 Japan Overall Household Spending (YoY) (OCT) Medium   1.1% -1.6%
23:45 U.S Powell Gives Brief Welcome Remarks at Housing Conference High      

Euro

The single currency ended the day almost unchanged after falling earlier in the session. The EU commission presented its plan to reduce the dollar’s overwhelming dominance of the global economy and to strengthen the role of the euro, particularly for energy transactions. European capitals are increasingly frustrated with the global dominance of the dollar. Overall, the EUR/USD traded with a low of 1.1309 and a high of 1.1359 before closing the day around 1.1343 in the New York session.

 

Yen

The Japanese Yen lost ground yesterday. There were no data indicators in Japan or the U.S. Today, the focus will be on employment data will be in focus, with the release of ADP nonfarm payrolls and unemployment claims. We’ll also get a look at ISM Non-Manufacturing PMI. Japan will release household spending and average cash earnings. Overall, the USD/JPY traded with a low of 112.96 and a high of 113.22 before closing the day around 113.17 in the U.S session.

 

British Pound

The British Pound rose against the Dollar and the euro yesterday as traders priced in an increased chance of the UK staying in the EU following a disastrous day for the prime minister. An unprecedented string of three defeats for the government and a key decision on Brexit from Europe’s top court sent sterling up. Overall, the GBP/USD traded with a low of 1.2670 and a high of 1.2796 before closing the day at 1.2731 in the New York session.

 

Canadian Dollar

The Canadian Dollar weakened to one-and-a-half-year low against its U.S counterpart yesterday as investors slashed expectations for further interest rate hikes from the Bank of Canada after a dovish interest rate announcement from the central bank. The Bank of Canada kept its benchmark interest rate on hold at 1.75 per cent. Overall, USD/CAD traded with a low of 1.3250 and a high of 1.3397 before closing the day at 1.3352 in the New York session.

 

Australian Dollar

The Australian Dollar fell significantly, after recent ABS figures revealed Australia’s Gross Domestic Product slowed in September, missing expectations. Q/Q growth fell to 0.3%, and was expected to come in at 0.6%, while domestic demand came in weak. The Australian dollar against the greenback crashed upon the news. Overall, AUD/USD traded with a low of 0.7258 and a high of 0.7354 before closing the day at 0.7273 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 47 and lies below the neutral zone. In general, the pair has gained 0.38%.

 

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 also indicating a bearish stance. The Relative Strength Index is above 43 reading and lies below the neutral zone. On the whole, the pair has gained 0.51%.

  

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is indicating a bullish stance. The Relative Strength Index is above 52 reading and lies above the neutral region. In general, the pair has lost 0.58%.

  

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 bullish signal. The Relative Strength Index is above 56 and lies above the neutral region. On the whole, the pair has lost 0.10%.

  

Sterling-Swiss

This cross is trading below 14, 50 and 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 40 and lies below the neutral region. In general, the pair has gained 0.16%.

 

Appendix

  

FOREX Closing Prices for December 05, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.1341 1.13599 1.13095 1.13432 0.0002
USD/JPY 112.75 113.223 112.963 113.175 0.4150
GBP/USD 1.27151 1.27964 1.26703 1.27317 0.0017
USD/CHF 0.99718 1.00066 0.99686 0.99752 0.0003
USD/CAD 1.32612 1.3397 1.32504 1.33527 0.0093
EUR/JPY 127.887 128.468 127.766 128.393 0.4850
GBP/JPY 143.385 144.515 143.244 144.109 0.7280
CHF/JPY 113.037 113.469 112.915 113.422 0.3860
AUD/JPY 82.72 82.961 82.14 82.241 -0.4830
EUR/GBP 0.8921 0.893 0.88728 0.89077 -0.0009
EUR/CHF 1.13108 1.1329 1.13092 1.13162 0.0004
GBP/CHF 1.26791 1.27601 1.26702 1.27016 0.0020

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1265 1.1287 1.1315 1.1338 1.1366 1.1388 1.1416
USD/JPY 112.76 112.86 113.02 113.12 113.28 113.38 113.54
GBP/USD 1.2543 1.2607 1.2669 1.2733 1.2795 1.2859 1.2921
USD/CHF 0.9922 0.9945 0.9960 0.9983 0.9998 1.0021 1.0036
USD/CAD 1.3123 1.3187 1.3270 1.3333 1.3416 1.3480 1.3563
EUR/JPY 127.25 127.51 127.95 128.21 128.65 128.91 129.35
GBP/JPY 142.13 142.69 143.40 143.96 144.67 145.23 145.94
CHF/JPY 112.51 112.71 113.07 113.27 113.62 113.82 114.18
AUD/JPY 81.11 81.63 81.93 82.45 82.75 83.27 83.58
EUR/GBP 0.8820 0.8846 0.8877 0.8904 0.8934 0.8961 0.8991
EUR/CHF 1.1287 1.1298 1.1307 1.1318 1.1327 1.1338 1.1347
GBP/CHF 1.2571 1.2621 1.2661 1.2711 1.2751 1.2801 1.2841

 

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.