20 Jul 2018

         

FOREX Newsletter

July 20, 2018

Pulse of the Market

·      U.S Department of Labor reported initial jobless claims dropped by 8,000 for the week ended July 14

·      The Philadelphia Fed said yesterday its manufacturing index rose to a reading of 25.7 in July

·      UK retail sales undershot expectations, denting the prospect for an August Bank of England rate hike

·      The Financial Conduct Authority advised banks yesterday to prepare for a no deal Brexit scenario

The Dollar reversed course against its rivals in yesterday’s trading session after U.S. President Trump said he was “not happy” about Federal Reserve rate hikes but downside was limited amid optimism over the U.S economy. The U.S. dollar index, which measures the green against a trade-weighted basket of six major currencies, fell by 0.08% to 94.75, after hitting a session high of 95.44. “I’m not happy about it,” President Donald Trump said about interest-rate increases during an interview with CNBC yesterday, claiming that “higher rates put us [United States] at a disadvantage.” Trump insisted, however, that he would let the “Fed do what they feel is best.” The comments scaled back some investor optimism over a faster pace of rate hikes which had followed bullish comments from Federal Reserve chair Jerome Powell earlier in the week. Powell said gradual interest rate hikes would be “the best way forward” for the economy, citing stronger labor markets, and inflation that had met the Fed’s 2% objective. Downside in the dollar limited, however, as positive economic data reaffirmed investor expectations the economy remained on solid footing. The U.S. Department of Labor reported yesterday that initial jobless claims dropped by 8,000 to a seasonally adjusted 207,000 for the week ended July 14, beating economists’ forecast for a drop to 220,000. The Philadelphia Fed said Thursday its manufacturing index rose to a reading of 25.7 in July from 19.9 in June. GBP/USD fell 0.23% to $1.3039, after plunging below $1.30 earlier as UK retail sales undershot expectations, denting the prospect for an August Bank of England rate hike. Retail sales month over month fell by 0.5% in June, lower than the expected increase of 0.1%. Sales for May were revised upward from 1.3% to 1.4%. The core retail sales figure, which excludes automobiles and fuel, fell by 0.6% – lower than the expected drop of 0.3%. Overall retail sales growth for the second quarter came in at the strongest level since 2004 despite the fall in June. Safe-haven currencies were in demand as the yen and Swiss franc rose against the greenback on the back of renewed concerns about an escalation in the U.S.-China trade war.

 

   

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
03:00 New Zealand Credit Card Spending (YoY) (JUN) Medium     3.7%
04:30 Japan All Industry Activity Index (MoM) (MAY) Medium   0.0% 1.0%
06:00 German Producer Price Index (YoY) (JUN) Low   3.0% 2.7%
08:00 Euro-Zone Current Account n.s.a. (euros) (MAY) Low     26.2b
08:30 U.K Public Finances (PSNCR) (Pounds) (JUN) Medium     4.5b
08:30 U.K Central Government NCR (JUN) Medium     6.9b
08:30 U.K Public Sector Net Borrowing (JUN) Medium   3.6b 3.4b
08:30 U.K PSNB ex Banking Groups (JUN) Medium   5.0b 5.0b
12:00 U.S Fed’s Bullard Speaks on Economy and Monetary Policy Low      
12:30 Canada Retail Sales (MoM) (MAY) Medium   1.0% -1.2%
12:30 Canada Consumer Price Index n.s.a. (MoM) (JUN) Medium   0.0% 0.1%
12:30 Canada Consumer Price Index (YoY) (JUN) High   2.3% 2.2%
17:00 Baker Hughes U.S Rig Count (JUL 20) Medium     1054

 

 

Euro

The single currency gained in yesterday’s trading session as the Dollar fell from a one-year peak yesterday after U.S. President Donald Trump expressed concern about a strong currency, which he said puts the United States at a disadvantage. The five-year growth run has been supported by exceptionally loose monetary policy. Overall, the EUR/USD traded with a low of 1.1573 and a high of 1.1677 before closing the day around 1.1640 in the New York session.

 

Yen

The Japanese Yen pair fell from a one-year peak on Thursday after U.S. President Donald Trump expressed concern about a strong currency, which he said puts the United States at a disadvantage. The greenback also gave back some of its gains against the Chinese Yuan, which had earlier dropped to a one-year low against the dollar. Overall, the USD/JPY traded with a low of 112.04 and a high of 113.15 before closing the day around 112.45 in the U.S session.

 

British Pound

The British Pound dropped below the $1.30 level on Thursday as a result of an unexpected drop in consumer spending in June, further sliming the chances of a Bank of England rate hike in August. Retail sales month over month fell by 0.5% in June, lower than the expected increase of 0.1%. Sales for May were revised upward from 1.3% to 1.4%.  Overall, the GBP/USD traded with a low of 1.2955 and a high of 1.3081 before closing the day at 1.3012 in the New York session.

 

Canadian Dollar

The Canadian Dollar fell to a three-week low against a strong U.S Dollar yesterday, hammered by weaker commodity prices and lingering uncertainty about global trade after President Donald Trump said the United States wants to negotiate bilateral deals with Canada and Mexico. Lower commodity prices weighed on the commodity-based Canadian currency. Overall, USD/CAD traded with a low of 1.3157 and a high of 1.3287 before closing the day at 1.3270 in the New York session.

 

Australian Dollar

The Australian Dollar rose broadly earlier in yesterday’s session after official data appeared to show the 2018 slowdown in Aussie jobs growth coming to an end in June but fell later in the day. Australia’s economy created 59,900 new jobs during the recent month, according to the Australian Bureau of Statistics, up from 13,400 in May and far ahead of the consensus for an increase of 16,700. Overall, AUD/USD traded with a low of 0.7320 and a high of 0.7439 before closing the day at 0.7355 in the New York session.

 

 
Euro-Yen

EUR/JPY is trading above 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 59 and lies above the neutral zone. In general, the pair has lost 0.31%.

 

 

Sterling-Yen

Currently, GBP/JPY is trading above 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 44 reading and lies below the neutral zone. On the whole, the pair has lost 0.75%.

 

 

 

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 51 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 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 0.45%.

 

 

 

Sterling-Swiss

This cross is trading above 14, 50 and below 100 days moving average. Fast stochastic is issuing a bearish stance and MACD is indicating a bullish tone. The Relative Strength Index is above 35 and lies below the neutral region. In general, the pair has lost 0.41%.

Appendix

  

FOREX Closing Prices for July 19, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.16379 1.1677 1.15736 1.16403 0.0003
USD/JPY 112.838 113.15 112.042 112.45 -0.3700
GBP/USD 1.30675 1.30815 1.29556 1.30126 -0.0055
USD/CHF 0.99929 1.00415 0.99569 0.99894 0.0002
USD/CAD 1.31665 1.32872 1.31577 1.32701 0.0104
EUR/JPY 131.324 131.408 130.705 130.918 -0.4110
GBP/JPY 147.467 147.575 146.136 146.342 -1.1100
CHF/JPY 112.88 112.98 112.446 112.534 -0.3930
AUD/JPY 83.45 83.895 82.557 82.698 -0.7480
EUR/GBP 0.89046 0.89529 0.8901 0.8944 0.0040
EUR/CHF 1.16288 1.16376 1.16114 1.16301 0.0005
GBP/CHF 1.30597 1.3065 1.29847 1.30001 -0.0054

 

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1480 1.1527 1.1584 1.1630 1.1687 1.1734 1.1790
USD/JPY 110.84 111.44 111.94 112.55 113.05 113.66 114.16
GBP/USD 1.2826 1.2891 1.2952 1.3017 1.3078 1.3142 1.3203
USD/CHF 0.9866 0.9911 0.9950 0.9996 1.0035 1.0081 1.0120
USD/CAD 1.3060 1.3109 1.3189 1.3238 1.3319 1.3368 1.3448
EUR/JPY 129.91 130.31 130.61 131.01 131.32 131.71 132.02
GBP/JPY 144.35 145.25 145.79 146.68 147.23 148.12 148.67
CHF/JPY 111.79 112.12 112.33 112.65 112.86 113.19 113.39
AUD/JPY 80.87 81.71 82.21 83.05 83.54 84.39 84.88
EUR/GBP 0.8860 0.8881 0.8912 0.8933 0.8964 0.8985 0.9016
EUR/CHF 1.1589 1.1600 1.1615 1.1626 1.1641 1.1653 1.1668
GBP/CHF 1.2888 1.2936 1.2968 1.3017 1.3049 1.3097 1.3129

 

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 Jul 2018

FOREX Newsletter

     

FOREX Newsletter

July 19, 2018

Pulse of the Market

·      U.S housing starts tumbled 12.3% to a seasonally adjusted annual rate of 1.173 million units

·      A slump in the British Pound to September lows limited U.S Dollar weakness

·      Weaker U.K inflation data dented expectations for a Bank of England rate hike

·      China’s Ministry of Commerce warned of further measures in response to aluminum and steel tariffs

The Dollar was unchanged against its rivals yesterday as gains on the back of a slump in the pound were offset by soft U.S economic data showing subdued housing market activity. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.04% to 94.77, down from a session high of 95.18. Housing starts slumped to a nine-month low as both higher mortgage rates and elevated costs for labor and materials weighed on the housing market, government figures showed yesterday. Housing starts tumbled 12.3% to a seasonally adjusted annual rate of 1.173 million units last month, the Commerce Department said. The report also highlighted a 2.2% decline in building permits to a rate of 1.273 million units. That was the lowest level since September 2017. Analysts, however, claimed the duo of weaker reports did not signal that the housing recovery had “shorted out.” While labor also remains in short supply and pricey, we believe the greatest impediment to homebuilding right now is that fewer projects pencil out. That said, the housing recovery has not shorted out. Market participants were also monitoring Fed Chairman Jay Powell’s testimony before the House Financial Services Committee yesterday. Reaction in currencies was muted as Powell offered little new insight on monetary policy. A slump in the pound to September lows limited dollar weakness as weaker U.K. inflation data dented expectations for a Bank of England rate hike despite calls from analysts insisting that inflation was strong enough to support an August rate hike. U.K. inflation data likely won’t deter the Bank of England from raising the interest rates in August. But a further fall in core inflation will make a second rate hike in 2018 unlikely. U.K. consumer prices rose 2.4%, unchanged from May and missing expectations of a 2.6% reading. Core inflation slipped to 1.9%, falling below the Bank of England’s 2% target. The greenback also gave up gains against safe-haven currencies such as the yen and Swiss franc after China’s Ministry of Commerce warned of further countermeasures in response to U.S. steel and aluminum tariffs.

 

   

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
01:30 Australia NAB Business Confidence (2Q) Medium     7
01:30 Australia Employment Change (JUN) High   16.5k 12.0k
01:30 Australia Unemployment Rate (JUN) High   5.4% 5.4%
06:00 Japan Machine Tool Orders (YoY) (JUN) Low     11.4%
08:30 U.K Retail Sales Ex Auto Fuel (YoY) (JUN) Medium   3.7% 4.4%
08:30 U.K Retail Sales Inc Auto Fuel (YoY) (JUN) Low   3.5% 3.9%
12:30 Canada ADP Publishes June Payrolls Report Low      
12:30 U.S Initial Jobless Claims (JUL 14) Medium   221k 214k
12:30 U.S Continuing Claims (JUL 07) Medium   1725k 1739k
12:30 U.S Philadelphia Fed Business Outlook (JUL) Medium   21.5 19.9
14:00 U.S Leading Index (JUN) Medium   0.5% 0.2%
23:30 Japan National Consumer Price Index (YoY) (JUN) High   0.8% 0.7%
23:30 Japan National Consumer Price Index Ex-Fresh Food (YoY) (JUN) Medium   0.8% 0.7%

 

 

Euro

The single currency fell and the yen slid to a six-month low as the dollar extended its rally following bullish comments from U.S. Federal Reserve Chairman Jerome Powell about the strength of the U.S. economy. In his closely watched congressional testimony on Tuesday, Powell said he saw the United States on course for years more of steady growth. Overall, the EUR/USD traded with a low of 1.1600 and a high of 1.1663 before closing the day around 1.1637 in the New York session.

 

Yen

The Japanese Yen pair surged in yesterday’s trading session. The Fed is expected to have hiked a total of four times in 2018 to tackle rising inflationary pressures. The dollar index rose to 95.267, up 0.3 percent on the day and just below its 95.531 12-month high hit in June. The dollar rallied to as high as 113.14 against the yen, its strongest since January 9. Overall, the USD/JPY traded with a low of 112.69 and a high of 113.11 before closing the day around 112.82 in the U.S session.

 

British Pound

The British Pound extended Tuesday’s losses after the government narrowly won a vote on its Brexit proposal, underlining the political divisions that have hampered efforts to agree on a united front in negotiating with Brussels. The two-year Treasury yield, most sensitive to the market’s views on changes in Fed policy, has risen to a decade-high.  Overall, the GBP/USD traded with a low of 1.3008 and a high of 1.3117 before closing the day at 1.3068 in the New York session.

 

Canadian Dollar

The Canadian Dollar rose against the U.S dollar, reversing earlier losses after President Donald Trump said he may negotiate separate trade deals with Mexico and Canada. This is not the first time that Trump had suggested bilateral deals with Mexico and Canada, as he vowed to revamp the 24-year old North American Free Trade Agreement (NAFTA). Overall, USD/CAD traded with a low of 1.3159 and a high of 1.3257 before closing the day at 1.3166 in the New York session.

 

Australian Dollar

The Australian Dollar was a shade lower, extending the retreat from Tuesday as the US dollar rose across the board, climbing to a six-month high against the yen, after Federal Reserve Chairman Jerome Powell gave an upbeat outlook for the US economy and reinforced views that the Fed was on track to steadily hike interest rates. Overall, AUD/USD traded with a low of 0.7341 and a high of 0.7405 before closing the day at 0.7392 in the New York session.

 

 

Euro-Yen

EUR/JPY is trading above 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 64 and lies above the neutral zone. In general, the pair has lost 0.21%.

 

Sterling-Yen

Currently, GBP/JPY is trading above 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 52 reading and lies above the neutral zone. On the whole, the pair has lost 0.38%.

 

 Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 61 reading and lies above the neutral region. In general, the pair has gained 0.09%.

  

Euro-Sterling

This cross is currently trading above 14, 50 and 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is also issuing a bearish signal. The Relative Strength Index is above 65 and lies above the neutral region. On the whole, the pair has gained 0.16%.

    

Sterling-Swiss

This cross is trading above 14, 50 and below 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The Relative Strength Index is above 38 and lies below the neutral region. In general, the pair has lost 0.45%.

Appendix

  

FOREX Closing Prices for July 18, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.16593 1.16635 1.16006 1.16372 -0.0022
USD/JPY 112.842 113.119 112.691 112.82 -0.0420
GBP/USD 1.3117 1.3117 1.30084 1.3068 -0.0045
USD/CHF 0.99996 1.00329 0.99809 0.99877 -0.0012
USD/CAD 1.31901 1.32573 1.31596 1.31664 -0.0022
EUR/JPY 131.575 131.753 130.86 131.329 -0.2710
GBP/JPY 148.036 148.207 146.84 147.452 -0.5620
CHF/JPY 112.821 112.991 112.625 112.927 0.0930
AUD/JPY 83.353 83.516 82.808 83.446 0.0760
EUR/GBP 0.88866 0.893 0.88721 0.89037 0.0014
EUR/CHF 1.1661 1.16673 1.16003 1.1625 -0.0036
GBP/CHF 1.31182 1.3137 1.30105 1.30541 -0.0059

  

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1541 1.1571 1.1604 1.1634 1.1667 1.1697 1.1730
USD/JPY 112.21 112.45 112.63 112.88 113.06 113.30 113.49
GBP/USD 1.2903 1.2956 1.3012 1.3064 1.3121 1.3173 1.3229
USD/CHF 0.9916 0.9949 0.9968 1.0001 1.0020 1.0053 1.0072
USD/CAD 1.3034 1.3097 1.3132 1.3194 1.3229 1.3292 1.3327
EUR/JPY 129.98 130.42 130.88 131.31 131.77 132.21 132.66
GBP/JPY 145.43 146.13 146.79 147.50 148.16 148.87 149.53
CHF/JPY 112.34 112.48 112.70 112.85 113.07 113.21 113.44
AUD/JPY 82.29 82.55 83.00 83.26 83.71 83.96 84.41
EUR/GBP 0.8816 0.8844 0.8874 0.8902 0.8932 0.8960 0.8990
EUR/CHF 1.1527 1.1564 1.1594 1.1631 1.1661 1.1698 1.1728
GBP/CHF 1.2871 1.2941 1.2997 1.3067 1.3124 1.3194 1.3250

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 Jul 2018

FOREX Newsletter

       

FOREX Newsletter

July 18, 2018

Pulse of the Market

·      Fed Chair said strong growth should keep the central bank on track to keep raising interest rates

·      The euro slid against the firmer dollar, with EUR/USD losing 0.2% to trade at 1.1685

·      Prime Minister Theresa May facing threats from both sides of the Brexit divide

·      U.S industrial production rebounded in June, boosted by a sharp rebound in manufacturing

The U.S Dollar rose against its rivals yesterday, as Federal Reserve Chairman Jay Powell gave lawmakers a positive assessment of the economy, and expects to continue raising interest rates gradually. The U.S dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.52% to 94.76. In his semi-annual testimony to Congress yesterday, Powell said the “best way forward” is to continue raising rates, as the job market has strengthened and inflation has moved above the Fed’s 2% target. Powell largely echoed the Fed’s recent comments from its June meeting, when the Fed raised interest rates, and hinted at two further rate hikes for this year. Powell could offer further clues on monetary policy when he testifies before the House Financial Services Committee today. Rate Monitor Tool, 85.6% of traders expects the Fed to hike rates in September, and 56.2% of traders expect the Fed to hike rates again in December. Economic data showing U.S. industrial production rebounded in June, boosted by a sharp rebound in manufacturing, and gains in mining output, had a somewhat muted impact on the greenback. Industrial production – a measure of output at factories, mines and utilities – rose to a seasonally-adjusted 0.6% in June from a revised 0.5% decline the prior month, the Federal Reserve said Tuesday. This was slightly above the 0.5% rise forecast by economists. The Dollar’s move higher was also supported by a fall in both the pound and euro. Sterling came under pressure amid soft UK data and expectations that Prime Minister Theresa May’s Brexit bill could face another challenge in Parliament. The pound was broadly weaker, with GBP/USD falling 0.55% to 1.3164 as fresh political uncertainty weighed ahead of another crunch vote in the UK parliament later in the day, with Prime Minister Theresa May facing threats from both sides of the Brexit divide. On Monday, the International Monetary Fund warned that escalating trade tensions are threatening to derail the economic recovery, adding that financial markets seem complacent to the mounting risk. USD/CAD rose as a rise in expectations for a Bank of Canada rate hike on the back of bullish factory sales data failed to lift the loonie.

 

   

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
08:30 U.K Consumer Price Index (YoY) (JUN) High 2.6% 2.4%
08:30 U.K Retail Price Index (YoY) (JUN) Low 3.5% 3.3%
08:30 U.K House Price Index (YoY) (MAY) Medium 3.7% 3.9%
09:00 Euro-Zone Consumer Price Index (YoY) (JUN) Medium 2.0% 1.9%
11:00 U.S MBA Mortgage Applications (JUL 13) Medium 2.5%
12:30 U.S Housing Starts (MoM) (JUN) Medium -2.2% 5.0%
12:30 U.S Building Permits (MoM) (JUN) Medium 2.2% -4.6%
14:00 U.S Fed Chairman Powell Appears Before House Panel High
14:30 DOE U.S. Crude Oil Inventories (JUL 13) Medium -12633k
18:00 U.S Federal Reserve Releases Beige Book Medium
23:50 Japan Trade Balance (JUN) Medium ¥531.2b -¥578.3b
23:50 Japan Adjusted Merchandise Trade Balance (Yen) (JUN) Low ¥155.0b -¥296.8b

 

 

Euro

The single currency posted gains yesterday. In economic news, there were no events in the Eurozone. The U.S releases manufacturing and housing indicators. Federal Reserve Chair Jerome Powell testifies before the Senate Banking Committee. Today, the Eurozone releases Final CPI and the U.S publishes building permits and housing starts. Overall, the EUR/USD traded with a low of 1.1648 and a high of 1.1743 before closing the day around 1.1659 in the New York session.

 

Yen

The Japanese Yen pair traded higher at 112.48 in yesterday’s session ahead of the Federal Reserve Chairman Jerome Powell’s semi-annual testimony on the economy and monetary policy. Overall, the dollar index was weaker against a basket of six major currencies (-0.03%) and is set to post the third consecutive negative day. Overall, the USD/JPY traded with a low of 112.20 and a high of 112.90 before closing the day around 112.86 in the U.S session.

 

British Pound

The British Pound touched a session high of 1.3267 after the Office for National Statistics revised April’s average earnings index (including bonuses) from 2.5% to 2.6%. The pair, though, soon fell later in the day as the BoE chief Mark Carney highlighted during his testimony that a no-Brexit deal could be a risk to interest rates.  Overall, the GBP/USD traded with a low of 1.3067 and a high of 1.3267 before closing the day at 1.3113 in the New York session.

 

Canadian Dollar

The Canadian Dollar was mostly weaker yesterday. The loonie is currently selling off against the US dollar and the Euro. Falling WTI crude oil prices are catching up to the Canadian dollar. Given the lack of significant economic developments from Canada, the loonie traded as a function of broader developments in financial markets. Overall, USD/CAD traded with a low of 1.3108 and a high of 1.3216 before closing the day at 1.3188 in the New York session.

 

Australian Dollar

The Australian Dollar was subdued yesterday as the country’s central bank expressed concern about the impact of high household debt on the economy while the New Zealand dollar maintained recent ranges. The currency is now down more than 5 per cent since the start of the year when it traded above 80 US cents. Overall, AUD/USD traded with a low of 0.7374 and a high of 0.7436 before closing the day at 0.7384 in the New York session.

 

 

Euro-Yen

EUR/JPY is trading above 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 68 and lies above the neutral zone. In general, the pair has gained 0.08%.

 

 Sterling-Yen

Currently, GBP/JPY is trading above 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 59 reading and lies above the neutral zone. On the whole, the pair has lost 0.38%.

 

 Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 60 reading and lies above the neutral region. In general, the pair has gained 11%.

 

Euro-Sterling

This cross is currently trading above 14, 50 and 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is also issuing a bearish signal. The Relative Strength Index is above 61 and lies above the neutral region. On the whole, the pair has gained 0.49%.

 

 Sterling-Swiss

This cross is trading above 14, 50 and below 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The Relative Strength Index is above 43 and lies below the neutral region. In general, the pair has lost 0.58%.

 

Appendix

 

FOREX Closing Prices for July 17, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.17137 1.17433 1.16487 1.16597 -0.0050
USD/JPY 112.27 112.905 112.206 112.862 0.5950
GBP/USD 1.32324 1.32671 1.30674 1.31133 -0.0120
USD/CHF 0.99661 1.00003 0.99251 0.99994 0.0034
USD/CAD 1.31384 1.32168 1.31086 1.31884 0.0055
EUR/JPY 131.513 131.969 131.433 131.6 0.1060
GBP/JPY 148.579 149.066 147.553 148.014 -0.5650
CHF/JPY 112.622 113.234 112.53 112.834 0.2110
AUD/JPY 83.281 83.571 83.181 83.37 0.0890
EUR/GBP 0.88498 0.8913 0.88382 0.88899 0.0043
EUR/CHF 1.16728 1.16795 1.16379 1.16606 -0.0011
GBP/CHF 1.31897 1.32069 1.30685 1.31134 -0.0076

   

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1530 1.1589 1.1625 1.1684 1.1719 1.1779 1.1814
USD/JPY 111.71 111.96 112.41 112.66 113.11 113.36 113.81
GBP/USD 1.2832 1.2950 1.3031 1.3149 1.3231 1.3349 1.3431
USD/CHF 0.9874 0.9900 0.9950 0.9975 1.0025 1.0050 1.0100
USD/CAD 1.3018 1.3063 1.3126 1.3171 1.3234 1.3279 1.3342
EUR/JPY 130.83 131.13 131.37 131.67 131.90 132.20 132.44
GBP/JPY 145.84 146.70 147.36 148.21 148.87 149.72 150.38
CHF/JPY 111.79 112.16 112.50 112.87 113.20 113.57 113.91
AUD/JPY 82.79 82.98 83.18 83.37 83.57 83.76 83.96
EUR/GBP 0.8773 0.8806 0.8848 0.8880 0.8923 0.8955 0.8997
EUR/CHF 1.1598 1.1618 1.1639 1.1659 1.1681 1.1701 1.1722
GBP/CHF 1.2914 1.2991 1.3052 1.3130 1.3191 1.3268 1.3329

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 Jul 2018

FOREX Newsletter

           

FOREX Newsletter

July 17, 2018

Pulse of the Market

·      The U.S Commerce Department said yesterday that core retail sales rose 0.4% last month

·      The Empire State manufacturing index fell 2.4 points in July to a reading of 22.60

·      GBP fell ahead of slew of data this week which could determine the prospect of BOE rate hike

·      The Canadian Dollar rose against many of its rivals in yesterday’s trading session

The U.S Dollar was slightly lower against its rivals yesterday, as in-line U.S retail sales data, and slightly better than forecast regional manufacturing activity provided little impetus for upside in the greenback. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell by 0.14% to 94.31, down from a session high of 94.53. The Commerce Department said on Monday that core retail sales rose 0.4% last month, compared with an upwardly revised 1.4% increase for May. The retail sales control group – which has a larger impact on U.S. GDP – came in at 0.0% missing expectations for a 0.4% rise. The Empire State manufacturing index fell 2.4 points in July to a reading of 22.60, the New York Federal Reserve said yesterday. The dollar was also kept on the back foot by an uptick in safe-currencies like the yen and Swiss Franc amid fresh trade concerns after the U.S. filed complaints to the World Trade Organization (WTO) against China, Canada, EU, Mexico and Turkey in response to retaliatory tariffs.  The subdued start to the week for the greenback comes as traders awaited further clues on monetary policy as Fed chairman Jerome Powell is expected to testify on the economy and monetary policy before the U.S. Senate Banking Committee today. Ahead of Powell’s appearance, the Fed gave a positive assessment of the U.S. economy, insisting that strong labor markets and inflation would support the central bank’s plan to continue with gradual rate hikes. GBP/USD fell 0.02% to $1.3232, ahead of slew of data this week which could determine the prospect of an August Bank of England rate hike as average wage data is expected Tuesday, while inflation figures and retail sales are due later in the week. The Canadian dollar drifted higher yesterday, benefiting from the greenback’s overall weakness, but the outlook remained tilted to the downside amid global trade tensions with the United States and the European Union.

 

   

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
01:30 RBA July Meeting Minutes Medium      
01:30 China New Home Prices (MoM) (JUN) Medium     0.8%
04:00 Japan Tokyo Condominium Sales (YoY) (JUN) Low     -5.4%
08:00 BOE’s Carney, Cunliffe, Stheeman Speak on Financial Stability High      
08:30 U.K Claimant Count Rate (JUN) Medium     2.5%
08:30 U.K Jobless Claims Change (JUN) Medium     -7.7k
08:30 U.K Average Weekly Earnings (3M/YoY) (MAY) Medium   2.5% 2.5%
08:30 U.K ILO Unemployment Rate 3Mths (MAY) Medium   4.2% 4.2%
08:30 U.K Employment Change 3M/3M (MAY) Medium   115k 146k
12:30 Canada Manufacturing Sales (MoM) (MAY) Low   0.5% -1.3%
13:15 U.S Industrial Production (MoM) (JUN) Medium   0.5% -0.1%
13:15 U.S Manufacturing (SIC) Production (JUN) Medium   0.6% -0.7%
14:00 U.S NAHB Housing Market Index (JUL) Medium   69 68
14:00 U.S Powell to Deliver Semi-Annual Testimony Before Senate Panel High      
20:00 U.S Net Long-term TIC Flows (MAY) Medium     $93.9b

Euro

The single currency posted gains yesterday. In economic news, the Eurozone trade surplus slipped to EUR 16.9 billion, short of the estimate of EUR 17.6 billion. This marked the lowest surplus since January 2017. In the U.S, the focus was on consumer spending reports. In today’s session, Federal Reserve Chair will testify before the Senate Banking Committee. Overall, the EUR/USD traded with a low of 1.1674 and a high of 1.1724 before closing the day around 1.1709 in the New York session.

 

Yen

The Japanese Yen pair slipped in yesterday’s trading session. The USD/JPY pair had a difficult time setting its next short-term direction yesterday amid a subdued trading action surrounding the FX markets. After advancing to mid-112 during the first half of the day, the USD/JPY pair lacked a follow-through as this move. Overall, the USD/JPY traded with a low of 112.21 and a high of 112.54 before closing the day around 112.26 in the U.S session.

 

British Pound

The British Pound has recorded slight gains. In North American trade, the pair traded 0.24% on the day. On the release front, British Rightmove HPI surprised with a decline of -0.1%, its first decline since December. In the U.S, core retail sales dropped to 0.4%, matching the estimate. Retail sales dropped to 0.5%, edging above 0.4%.  Overall, the GBP/USD traded with a low of 1.3215 and a high of 1.3290 before closing the day at 1.3233 in the New York session.

 

Canadian Dollar

The Canadian Dollar drifted higher against the U.S. currency yesterday, benefiting from the greenback’s overall weakness, but the outlook remained tilted to the downside amid global trade tensions with the United States and the European Union. Against other currencies, such as the euro and sterling, the Canadian mostly underperformed on the day. Overall, USD/CAD traded with a low of 1.3107 and a high of 1.3158 before closing the day at 1.3133 in the New York session.

 

Australian Dollar

The Australian Dollar depreciated against the dollar following the release of a slew of China data yesterday. China’s economy expanded 6.7% in the second quarter, its slowest pace since 2016, although the growth is still above the government’s target of “about 6.5%” growth for the year. While the official GDP readings were largely in line with market expectations. Overall, AUD/USD traded with a low of 0.7407 and a high of 0.7440 before closing the day at 0.7412 in the New York session.

Euro-Yen

EUR/JPY is trading above 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 66 and lies above the neutral zone. In general, the pair has gained 0.19%.

 

 Sterling-Yen

Currently, GBP/JPY is trading above 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 64 reading and lies above 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 bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 58 reading and lies above the neutral region. In general, the pair has lost 07%.

 

Euro-Sterling

This cross is currently trading above 14, 50 and 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is also issuing a bearish signal. The Relative Strength Index is above 55 and lies above the neutral region. On the whole, the pair has gained 0.23%.

  

Sterling-Swiss

This cross is trading above 14, 50 and below 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The Relative Strength Index is above 52 and lies above the neutral region. In general, the pair has lost 0.49%.

 

Appendix

 

FOREX Closing Prices for July 16, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.16796 1.1724 1.16742 1.17099 0.0028
USD/JPY 112.369 112.544 112.21 112.267 -0.0620
GBP/USD 1.32264 1.32909 1.32151 1.3233 0.0000
USD/CHF 1.00201 1.00228 0.9961 0.99653 -0.0050
USD/CAD 1.31575 1.31589 1.31074 1.31337 -0.0018
EUR/JPY 131.255 131.674 131.239 131.494 0.2520
GBP/JPY 148.642 149.287 148.495 148.579 -0.0920
CHF/JPY 112.108 112.684 112.095 112.623 0.4870
AUD/JPY 83.321 83.654 83.19 83.281 -0.0570
EUR/GBP 0.88284 0.88519 0.88145 0.88464 0.0021
EUR/CHF 1.17045 1.17118 1.16679 1.16715 -0.0029
GBP/CHF 1.32545 1.32641 1.31828 1.31895 -0.0065

  

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1632 1.1653 1.1681 1.1703 1.1731 1.1753 1.1781
USD/JPY 111.80 112.01 112.14 112.34 112.47 112.67 112.80
GBP/USD 1.3126 1.3171 1.3202 1.3246 1.3278 1.3322 1.3353
USD/CHF 0.9881 0.9921 0.9943 0.9983 1.0005 1.0045 1.0067
USD/CAD 1.3056 1.3082 1.3108 1.3133 1.3159 1.3185 1.3211
EUR/JPY 130.83 131.03 131.26 131.47 131.70 131.90 132.13
GBP/JPY 147.50 148.00 148.29 148.79 149.08 149.58 149.87
CHF/JPY 111.66 111.88 112.25 112.47 112.84 113.06 113.43
AUD/JPY 82.63 82.91 83.10 83.38 83.56 83.84 84.02
EUR/GBP 0.8786 0.8800 0.8823 0.8838 0.8861 0.8875 0.8898
EUR/CHF 1.1612 1.1640 1.1656 1.1684 1.1700 1.1728 1.1743
GBP/CHF 1.3079 1.3131 1.3160 1.3212 1.3241 1.3293 1.3323

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.

 

 

16 Jul 2018

FOREX Newsletter

         

FOREX Newsletter

July 16, 2018
 

 

Pulse of the Market

·      The Dollar dipped against a currency basket on Friday, pulling away from two week highs

·      Investors will be looking ahead to Fed Chairman Jerome Powell’s testimony on the economy

·      The Euro edged higher against the dollar in late trade, with EUR/USD rising 0.13% to 1.1686

·      The Sterling pushed higher late Friday, with GBP/USD gaining 0.23% to trade at 1.3235

The U.S Dollar dipped against a basket of currencies on Friday, fading from a two-week peak which was tied to news of a record Chinese trade surplus that may fuel U.S.-China trade tensions and that briefly spurred safe-haven bids for the greenback. The dollar’s pullback likely stemmed from modest gains on Wall Street and a drop-off in trading volume before the weekend. The U.S. dollar has been moving inversely with stocks. They could have restrained the dollar somewhat. An index that tracks the dollar against the yen, euro and four other currencies was down 0.07 percent to 94.740 after touching 95.241, which was the highest since June 29. The yen recovered from a six-month trough against the greenback after hitting a six-month low at 112.79 yen before recovering to 112.30 yen, up 0.2 percent on the day. The euro fell to a nine-day low at $1.1610 before ending flat at $1.1680. Despite the greenback’s stalling on Friday, prospects for a strong dollar remain intact. Trade war concerns amplify the downside risk on global growth. That tends to be positive for the dollar and puts a drag on other currencies. Upbeat comments on the U.S. economy from Federal Reserve Chairman Jerome Powell also stoked earlier demand for the dollar. U.S. Treasury Secretary Steven Mnuchin said on Thursday that the United States and China might reopen trade talks, briefly easing concerns about the trade dispute. But data showing China’s trade surplus with the United States swelled to a record in June could further inflame tensions. U.S. President Donald Trump this week pledged to impose tariffs on $200 billion more in Chinese imports. Beijing has vowed to retaliate. Escalating trade tensions have not dented the U.S. economy, which on is its second longest expansion on record. On Thursday, Fed chief Powell said in a Marketplace radio interview he believes the U.S. economy remains in a “good place,” with recent government tax and spending programs likely to boost growth for perhaps three years. The Fed released its semiannual report on monetary policy before Powell’s testimony to Congress next Tuesday and Wednesday. The report showed solid U.S. economic growth and the Fed expecting to keep raising rates gradually.

 

   
Time(GMT)   Economic Release IMP Actual Forecast Prior
02:00 China Surveyed Jobless Rate (JUN) Medium     4.8%
02:00 China Gross Domestic Product (YoY) (2Q) High   6.7% 6.8%
02:00 China Retail Sales (YoY) (JUN) Medium   9.0% 8.5%
02:00 China Industrial Production (YoY) (JUN) Medium   6.5% 6.8%
09:00 Euro-Zone Trade Balance (euros) (MAY) Low     18.1b
12:30 U.S Retail Sales Advance (MoM) (JUN) High     0.8%
12:30 U.S Retail Sales Ex Auto and Gas (JUN) Medium     0.8%
12:30 U.S Retail Sales Control Group (JUN) Medium     0.5%
13:00 Canada Existing Home Sales (MoM) (JUN) Medium   1.5% -0.1%
14:00 U.S Business Inventories (MAY) Medium     0.3%
22:45 New Zealand Consumer Price Index (YoY) (2Q) High     1.1%

 

Euro

The single currency fell earlier to an eight-day low on Friday as U.S inflation numbers boosted interest rate expectations and an easing in trade tensions between the United States and China supported the dollar. U.S. President’s comments on Brexit plan killing hopes of a U.S trade deal also knocked sterling lower, pushing the dollar up across the board. Overall, the EUR/USD traded with a low of 1.1611 and a high of 1.1684 before closing the day around 1.1681 in the New York session.

 

Yen

The Japanese Yen pair dipped on Friday, fading from a two-week peak which was tied to news of a record Chinese trade surplus that may fuel U.S.-China trade tensions and that briefly spurred safe-haven bids for the greenback. The dollar’s pullback likely stemmed from modest gains on Wall Street and a drop-off in trading volume before the weekend. Overall, the USD/JPY traded with a low of 112.25 and a high of 112.78 before closing the day around 112.32 in the U.S session.

 

British Pound

The British Pound rate got off to a rough start last week, with a surge in political uncertainty driving the pairing lower. This came in the wake of resignations of UK Foreign Secretary Boris Johnson and Brexit Secretary David Davis driving in protest over the Prime Ministers Brexit plans agreed to by the cabinet the previous week.  Overall, the GBP/USD traded with a low of 1.3100 and a high of 1.3234 before closing the day at 1.3233 in the New York session.

 

Canadian Dollar

The Canadian Dollar was little changed against its U.S. counterpart on Friday as oil prices rose, but for the week the loonie was on track to fall 0.6 per cent after broader gains for the greenback offset a Bank of Canada interest rate hike. The U.S. dollar faded from a two-week peak which was tied to news of a record Chinese trade surplus. Overall, USD/CAD traded with a low of 1.3147 and a high of 1.3206 before closing the day at 1.3152 in the New York session.

 

Australian Dollar

The Australian Dollar proved quite resilient to more gloomy trade headlines last week. News that the US was considering yet more tariffs on Chinese goods sapped the global risk appetite from which currencies such as the Aussie usually benefit. However, while AUD/USD certainly slipped, it didn’t fall very far and managed to rise again afterwards. Overall, AUD/USD traded with a low of 0.7366 and a high of 0.7420 before closing the day at 0.7419 in the New York session.

 

 

Euro-Yen

EUR/JPY is trading above 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 65 and lies above the neutral zone. In general, the pair has lost 0.07%.

 

 Sterling-Yen

Currently, GBP/JPY is trading above 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 65 reading and lies above the neutral zone. On the whole, the pair has gained 0.05%.

  

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 60 reading and lies above the neutral region. In general, the pair has closed unchanged.

 

 Euro-Sterling

This cross is currently trading above 14, 50 and 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is also issuing a bearish signal. The Relative Strength Index is above 52 and lies above the neutral region. On the whole, the pair has lost 0.10%.

 

Sterling-Swiss

This cross is trading above 14, 50 and below 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The Relative Strength Index is above 59 and lies above the neutral region. In general, the pair has gained 0.15%.

 

Appendix

 

FOREX Closing Prices for July 13, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.1669 1.16846 1.16116 1.16816 0.0012
USD/JPY 112.491 112.781 112.257 112.329 -0.1920
GBP/USD 1.32038 1.32347 1.31008 1.3233 0.0029
USD/CHF 1.00205 1.00663 1.00127 1.00151 -0.0006
USD/CAD 1.3154 1.32064 1.31479 1.3152 0.0000
EUR/JPY 131.303 131.507 130.783 131.242 -0.0880
GBP/JPY 148.553 148.681 147.616 148.671 0.0710
CHF/JPY 112.235 112.436 111.832 112.136 -0.1220
AUD/JPY 83.317 83.573 82.961 83.338 -0.0030
EUR/GBP 0.88358 0.88642 0.88233 0.88257 -0.0009
EUR/CHF 1.16946 1.17064 1.16559 1.17007 0.0005
GBP/CHF 1.32328 1.32622 1.31577 1.32545 0.0020

 

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1561 1.1586 1.1634 1.1659 1.1707 1.1732 1.1780
USD/JPY 111.61 111.93 112.13 112.46 112.65 112.98 113.18
GBP/USD 1.3010 1.3056 1.3144 1.3190 1.3278 1.3323 1.3412
USD/CHF 0.9943 0.9978 0.9996 1.0031 1.0050 1.0085 1.0104
USD/CAD 1.3073 1.3110 1.3131 1.3169 1.3190 1.3227 1.3248
EUR/JPY 130.12 130.45 130.85 131.18 131.57 131.90 132.30
GBP/JPY 146.90 147.26 147.96 148.32 149.03 149.39 150.09
CHF/JPY 111.23 111.53 111.83 112.13 112.44 112.74 113.04
AUD/JPY 82.40 82.68 83.01 83.29 83.62 83.90 84.23
EUR/GBP 0.8770 0.8797 0.8811 0.8838 0.8852 0.8879 0.8893
EUR/CHF 1.1618 1.1637 1.1669 1.1688 1.1719 1.1738 1.1770
GBP/CHF 1.3083 1.3120 1.3187 1.3225 1.3292 1.3329 1.3396

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 Jul 2018

FOREX Newsletter

     

FOREX Newsletter

July 13, 2018

 

Pulse of the Market

·      The U.S Dollar advanced to a fresh six-month high against the Japanese yen yesterday

·      Bloomberg reported that U.S and Chinese officials considered restarting the trade conversations

·      A measure of U.S consumer-price inflation hit a 6-year high in June data showed yesterday

·      The minutes of the ECB’s June meeting reiterated that interest will remain at current levels

The U.S Dollar was holding steady at one-and-a-half-week highs against a currency basket yesterday after data showing that U.S. inflation hit a six year high in June, underpinning expectations for two more rate hikes by the Federal Reserve this year. The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was trading, having risen 0.67% on Wednesday. Consumer inflation rose by an annualized 2.9% in June the Labor Department said. It was the highest rate since 2012. On a monthly basis, prices rose by just 0.1%, slowing from 0.2% in May. The figures came a day after data showing that U.S. producer prices posted the largest annual gain in six-and-a-half years in June, adding to signs of strength in the economy. The reports indicated that even with the uncertainty arising around U.S. trade policy the Fed should remain on track to keep hiking interest rates this year. Another report showed that initial jobless claims fell to a two month lows last week, as the labor market continues to tighten. The dollar was trading near six-month highs against the yen, with USD/JPY last at 112.48, up 0.44% for the day. The Federal Reserve pointed to possibly two more interest rate hikes in the remaining year, which would put the total number of increases at four. Supportive economic data makes this path more likely.  The euro was little changed, with EUR/USD last at 1.1678, still well below Monday’s three-and-a-half-week highs of 1.1790. Earlier Thursday the minutes of the European Central Bank’s June meeting reiterated that interest will remain at current levels for as long as needed to raise inflation towards its target. The ECB also warned that the increase in trade protectionism in recent months is hurting the European economy. The warning came as the European Commission cut its growth forecast for Europe this year, blaming the rising threat of a trade war. The Bank of Canada raised its benchmark interest rate on Wednesday by 25 basis points to 1.50 per cent and signaled more rate hikes to come, saying that while mounting trade tensions with the United States were a concern, their impact on growth and inflation looked modest so far. Money markets see a 65 per cent chance of another hike by December.
   
Time(GMT)   Economic Release IMP Actual Forecast Prior
04:30 Japan Industrial Production (YoY) (MAY) Medium     4.2%
06:00 German Wholesale Price Index (YoY) (JUN) Low     2.9%
11:00 Bank of England Deputy Governor Jon Cunliffe Speaks in Kendall Low      
12:30 U.S Import Price Index ex Petroleum (MoM) (JUN) Medium   0.3% 0.1%
12:30 U.S Import Price Index (YoY) (JUN) Low   4.7% 4.3%
12:30 U.S Export Price Index (YoY) (JUN) Medium     4.9%
13:00 Canada Existing Home Sales (MoM) (JUN) Medium   1.5% -0.1%
14:00 U.S U. of Mich. Sentiment (JUL) High   98.0 98.2
14:00 U.S U. of Mich. Current Conditions (JUL) Low     116.5
15:00 U.S Fed Releases Monetary Policy Report to Congress High      
17:00 Baker Hughes U.S. Rig Count (JUL 13) Medium     1052

 

Euro

The single currency fell after Government bond yields across the euro area fell yesterday after minutes from the ECB’s last meeting showed the bank will keep rates at record lows for as long as needed, and its rate guidance should be seen as “open-ended.” The gap between two- and 10-year borrowing costs is at its narrowest in over a year. Overall, the EUR/USD traded with a low of 1.1648 and a high of 1.1694 before closing the day around 1.1669 in the New York session.

 

Yen

The Japanese Yen pair strengthened to a six-month high, bolstered by solid inflation data and continuing a weeklong rally of the pair which suggests investors believe the greenback stands to benefit from a trade war. The weakness of the yen suggests bullish sentiment about the greenback, rather than a bid for safety. Overall, the USD/JPY traded with a low of 111.89 and a high of 112.60 before closing the day around 112.52 in the U.S session.

 

British Pound

The British Pound gained slightly yesterday. With all the uncertainty surrounding the UK at the moment such as political instability as well as the current Brexit negotiations that seem to be dragging on forever, many are starting to wonder just how is the British pound holding up in the face of such problems.  Overall, the GBP/USD traded with a low of 1.3178 and a high of 1.3243 before closing the day at 1.3204 in the New York session.

 

Canadian Dollar

The Canadian Dollar strengthened rebounding from an earlier 10-day low, as investor appetite for risk recovered and after the BOC raised interest rates on Wednesday for the second time this year. Canada exports many commodities, including oil, and runs a current account deficit so its economy could be hurt if the flow of trade or capital slows. Overall, USD/CAD traded with a low of 1.3147 and a high of 1.3216 before closing the day at 1.3151 in the New York session.

 

Australian Dollar

The Australian Dollar has been thrown on the defensive as their triple exposure to Asia, exports and commodities left them hostage to the fallout from a Sino-US trade conflict. Australia’s economic fate is entwined with China; given the Asian giant is its single largest export market and the world’s biggest buyer of commodities. Overall, AUD/USD traded with a low of 0.7358 and a high of 0.7417 before closing the day at 0.7400 in the New York session.

 

 

Euro-Yen

EUR/JPY is trading above 14 and below 50, 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also issuing a bearish stance. The Relative Strength Index is above 65 and lies above the neutral zone. In general, the pair has gained 0.47%.

 

Sterling-Yen

Currently, GBP/JPY is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 66 reading and lies above the neutral zone. On the whole, the pair has gained 0.48%.

 

Aussie-Yen

Currently, the cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 59 reading and lies above the neutral region. In general, the pair has gained 1.03%.

 

 Euro-Sterling

This cross is currently trading above 14, 50 and 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 53 and lies above the neutral region. On the whole, the pair has lost 0.05%.

 

 Sterling-Swiss

This cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The Relative Strength Index is above 58 and lies above the neutral region. In general, the pair has gained 0.66%.

 

Appendix

 

 

FOREX Closing Prices for July 12, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.1672 1.16943 1.16482 1.16695 -0.0002
USD/JPY 112.004 112.608 111.898 112.521 0.5200
GBP/USD 1.32028 1.32431 1.31786 1.32042 0.0002
USD/CHF 0.99571 1.00256 0.99456 1.00214 0.0064
USD/CAD 1.32101 1.32163 1.31473 1.31517 -0.0056
EUR/JPY 130.75 131.452 130.649 131.33 0.6110
GBP/JPY 147.908 148.873 147.767 148.6 0.7130
CHF/JPY 112.459 112.941 112.168 112.258 -0.1850
AUD/JPY 82.485 83.374 82.358 83.341 0.8530
EUR/GBP 0.88386 0.88481 0.88189 0.88347 -0.0004
EUR/CHF 1.16245 1.17059 1.16193 1.16953 0.0066
GBP/CHF 1.31474 1.32548 1.31335 1.32348 0.0087

 

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1601 1.1625 1.1647 1.1671 1.1693 1.1717 1.1739
USD/JPY 111.37 111.63 112.08 112.34 112.79 113.05 113.50
GBP/USD 1.3110 1.3144 1.3174 1.3209 1.3239 1.3273 1.3303
USD/CHF 0.9889 0.9918 0.9969 0.9998 1.0049 1.0078 1.0129
USD/CAD 1.3058 1.3103 1.3127 1.3172 1.3196 1.3241 1.3265
EUR/JPY 130.03 130.34 130.84 131.14 131.64 131.95 132.44
GBP/JPY 146.85 147.31 147.95 148.41 149.06 149.52 150.17
CHF/JPY 111.20 111.68 111.97 112.46 112.74 113.23 113.52
AUD/JPY 81.66 82.01 82.67 83.02 83.69 84.04 84.71
EUR/GBP 0.8791 0.8805 0.8820 0.8834 0.8849 0.8863 0.8878
EUR/CHF 1.1555 1.1587 1.1641 1.1674 1.1728 1.1760 1.1814
GBP/CHF 1.3039 1.3086 1.3161 1.3208 1.3282 1.3329 1.3403

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.

 

 

12 Jul 2018

FOREX Newsletter

     

FOREX Newsletter

July 12, 2018

 

Pulse of the Market

·      The Labor Department said its producer price index for final demand increased 0.3% last month

·      The Euro fell which followed a report that ECB members were split over when to raise rates

·      Both safe-haven currencies yen and Swiss franc were under pressure against the greenback

·      Bank of Canada raised interest rates and said it expected GDP to come in at 2.8% for the year

The U.S Dollar rose yesterday as data showing U.S. wholesale prices increased at a faster pace than anticipated last month raised investor expectations for stronger inflation, increasing the prospect of further Fed rate hikes. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.36% to 94.19. The Labor Department said on Wednesday its producer price index for final demand increased 0.3% last month. In the 12 months through June, the PPI rose 3.4% after rising 3.1% in May. This was the biggest annual increase in 6-1/2 years, stoking expectations the Fed could adopt a more aggressive stance on monetary policy tightening to rein in inflation. Euro weakness also pushed the greenback higher, as the single currency pared gains which followed report ECB members were split over when to raise rates. Some policymakers said an increase was possible as early as July 2019, while others suggested a move was unlikely until autumn next year, Reuters reported Wednesday, citing sources. The return of U.S.-China trade war jitters, meanwhile, did little to lift safe-haven currencies as both the yen and Swiss franc were under pressure against the greenback. The White House issued a list late Tuesday of 10% tariffs on $200 billion worth of Chinese imports it will assess. USD/CAD rose 0.26% to C$1.3148 after Bank of Canada raised interest rates Wednesday, and said it expected GDP to come in at 2.8% for the year. But analysts said the 2.8% year-end GDP target was somewhat optimistic and suggested that the loonie would continue to weaken. As things stand today, the 2.8% predicted growth for 2018 Q2 looks a touch optimistic, we remain biased for USD/CAD to re-test its 2018 highs in the coming weeks and months. The Canadian dollar whipsawed after the Bank of Canada increased interest rates as expected. After its initial 0.8 percent rally, the loonie swooned more than 1.1 percent when policymakers said U.S. tariffs would have a bigger effect on the economy than originally anticipated.
 
Time(GMT)   Economic Release IMP Actual Forecast Prior
01:00 Australia Consumer Inflation Expectation (JUL) Medium     4.2%
06:00 German Consumer Price Index (YoY) (JUN) Medium   2.1% 2.1%
08:30 Bank of England Credit Conditions & Bank Liabilities Surveys High      
09:00 Euro-Zone Industrial Production w.d.a. (YoY) (MAY) Medium   2.3% 1.7%
12:30 Canada New Housing Price Index (YoY) (MAY) Medium   1.0% 1.6%
12:30 U.S Initial Jobless Claims (JUL 07) Medium   225k 231k
12:30 U.S Continuing Claims (JUN 30) Medium     1739k
12:30 U.S Consumer Price Index (YoY) (JUN) High   2.9% 2.8%
12:30 U.S Consumer Price Index Ex Food and Energy (YoY) (JUN) High   2.3% 2.2%
12:30 U.S Real Avg Weekly Earnings (YoY) (JUN) Medium     0.3%
12:30 U.S Real Avg Hourly Earnings (YoY) (JUN) Medium     0.0%
18:00 U.S Monthly Budget Statement (JUN) Medium   -$80.0b -$146.8b
22:30 New Zealand BusinessNZ Manufacturing PMI (JUN) Medium     54.5

 

Euro

 

The single currency fell as the U.S Dollar strengthened in yesterday’s trading session after the market put aside trade tension fears and focused on the Labor Department’s expectation-beating inflation report, which increased prospects that the Federal Reserve will raise interest rates another two times this year. Overall, the EUR/USD traded with a low of 1.1664 and a high of 1.1756 before closing the day around 1.1671 in the New York session.

 

Yen

The Japanese Yen pair broke through the psychologically significant barrier of 112 yen for the first time since Jan. 10, rising as much as 1.3 percent to a top of 112.17 yen. Wednesday’s strong flows into the dollar/yen trade continued a trend that began after the United States last week reported decent employment data and a pickup in wages. Overall, the USD/JPY traded with a low of 110.74 and a high of 112.15 before closing the day around 112.00 in the U.S session.

 

British Pound

The British Pound faced a tough after ministers from British Prime minister Theresa May’s cabinet suddenly quit their posts, which has raised speculation that a leadership challenge could come as early as this week. The political instability has also cast into doubt the bank of England’s ability to lift interest rates next month.  Overall, the GBP/USD traded with a low of 1.3197 and a high of 1.3283 before closing the day at 1.3202 in the New York session.

 

Canadian Dollar

The Canadian Dollar weakened to a more than one-week low against its U.S counterpart in yesterday’s trading session as broad-based gains for the greenback offset an interest rate hike and the prospect of further tightening by the Bank of Canada. The U.S dollar rose as the market put aside trade tension fears and focused on an expectation-beating inflation report. Overall, USD/CAD traded with a low of 1.3062 and a high of 1.3212 before closing the day at 1.3208 in the New York session.

 

Australian Dollar

The Australian Dollar was unable to capitalize on improving local consumer sentiment data, weighed down by a resumption in trade war headlines. In July, Westpac Consumer Confidence rose 3.9% m/m which was the fastest increase since May 2016. Meanwhile, the index clocked in at 106.1 from 102.1 in June. That was the highest outcome since November 2013. Overall, AUD/USD traded with a low of 0.7363 and a high of 0.7445 before closing the day at 0.7364 in the New York session.

 

 

Euro-Yen

EUR/JPY is trading above 14 and below 50, 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also issuing a bearish stance. The Relative Strength Index is above 63 and lies above the neutral zone. In general, the pair has gained 0.29%.

 

Sterling-Yen

Currently, GBP/JPY is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 61 reading and lies above the neutral zone. On the whole, the pair has gained 0.38%.

  

Aussie-Yen

Currently, the cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 53 reading and lies above the neutral region. In general, the pair has lost 0.33%.

 

Euro-Sterling

This cross is currently trading above 14, 50 and 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 54 and lies above the neutral region. On the whole, the pair has lost 0.07%.

 

Sterling-Swiss

This cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The Relative Strength Index is above 47 and lies below the neutral region. In general, the pair has lost 0.13%.

 

Appendix

 

 

FOREX Closing Prices for July 11, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.17436 1.17568 1.1664 1.16717 -0.0071
USD/JPY 110.92 112.15 110.748 112.001 1.0210
GBP/USD 1.32746 1.32835 1.31978 1.32023 -0.0071
USD/CHF 0.99179 0.9964 0.99033 0.99575 0.0041
USD/CAD 1.3113 1.32128 1.30622 1.32081 0.0097
EUR/JPY 130.296 130.937 129.889 130.719 0.3820
GBP/JPY 147.265 148.105 146.778 147.887 0.5660
CHF/JPY 111.809 112.548 111.572 112.443 0.5620
AUD/JPY 82.515 82.693 82.037 82.488 -0.2760
EUR/GBP 0.88419 0.88597 0.88277 0.88387 -0.0006
EUR/CHF 1.16468 1.16558 1.16168 1.16293 -0.0018
GBP/CHF 1.31673 1.31811 1.31376 1.31474 -0.0017

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1545 1.1605 1.1638 1.1698 1.1731 1.1790 1.1824
USD/JPY 109.71 110.23 111.11 111.63 112.52 113.04 113.93
GBP/USD 1.3087 1.3142 1.3172 1.3228 1.3258 1.3314 1.3344
USD/CHF 0.9859 0.9881 0.9919 0.9942 0.9980 1.0002 1.0041
USD/CAD 1.2959 1.3010 1.3109 1.3161 1.3260 1.3312 1.3410
EUR/JPY 129.05 129.47 130.09 130.52 131.14 131.56 132.19
GBP/JPY 145.75 146.26 147.08 147.59 148.40 148.92 149.73
CHF/JPY 110.85 111.21 111.83 112.19 112.80 113.16 113.78
AUD/JPY 81.46 81.75 82.12 82.41 82.78 83.06 83.43
EUR/GBP 0.8792 0.8810 0.8824 0.8842 0.8856 0.8874 0.8888
EUR/CHF 1.1573 1.1595 1.1612 1.1634 1.1651 1.1673 1.1690
GBP/CHF 1.3086 1.3112 1.3130 1.3155 1.3173 1.3199 1.3217

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 Jul 2018

FOREX Newsletter

         

FOREX Newsletter

July 11, 2018

  Pulse of the Market

·      The Dollar extended early gains against a currency basket in yesterday’s trading session

·      German investor confidence fell to the lowest level in six years in July

·      UK economic growth picked up to 0.3% in May according to monthly GDP figures

·      Canadian Dollar was supported amid expectations the BOC will increase interest rates today

The U.S Dollar rose against its rivals yesterday, supported by upbeat labor market data and a weaker yen, as easing trade-war fears continued to keep a lid on demand for safe-haven currencies. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.16% to 93.95. The U.S. Labor Department’s latest Job Openings and Labor Turnover Survey (JOLTs) report, a measure of labor demand, showed job openings in May came in at about 6.64 million, beating expectations for 6.58 million. The uptick in job openings follows a bullish nonfarm payrolls report Friday, showing the U.S. economy had created more jobs than forecast in June, strengthening calls for further increases in U.S. interest rates. The odds of a fourth rate hike at the Federal Reserve’s December meeting has increased to 54%, up from about 44% last week, according to Fed Rate Monitor Tool. The dollar also added to gains against safe-haven currencies like the yen and the Swiss Franc as the flight-to-safety trade has been halted somewhat by easing trade-war fears. GBP/USD fell 0.07% to $1.3250 as manufacturing activity unexpectedly fell, and concerns over UK government turmoil weighed. But losses in sterling were limited, by an in-line GDP print, raising expectations for a Bank of England (BoE) August rate hike. A (BoE) rate increase in August is now more likely following data showing UK GDP grew 0.3% in May. The euro was weaker against the firmer dollar, with EUR/USD down 0.27%. In the euro zone, data on Tuesday showed that German investor confidence fell to the lowest level in six years in July as fears over an escalation in trade tensions with the U.S. dampened the economic outlook. The ZEW index of German investor sentiment dropped to -24.7 this month from -16.1 in June, the weakest reading since August 2012.

 

  
Time(GMT)   Economic Release IMP Actual Forecast Prior
00:30 Australia Westpac Consumer Confidence (JUL) Medium     0.3%
01:30 Australia Home Loans (MoM) (MAY) Medium   -2.0% -1.4%
04:30 Japan Tertiary Industry Index (MoM) (MAY) Medium   -0.3% 1.0%
07:00 ECB President Draghi Speaks in Frankfurt High      
07:30 ECB’s Praet Chairs Conference Session in Frankfurt Low      
11:00 U.S MBA Mortgage Applications (JUL 06) Medium     -0.5%
12:30 U.S PPI Final Demand (YoY) (JUN) Low   3.1% 3.1%
12:30 U.S Producer Price Index Ex Food and Energy (YoY) (JUN) Low   2.6% 2.4%
14:00 Bank of Canada Rate Decision (JUL 11) High   1.50% 1.25%
14:00 U.S Wholesale Trade Sales (MoM) (MAY) Low     0.8%
14:30 DOE U.S. Crude Oil Inventories (JUL 06) Medium     1245k
15:35 BOE Governor Mark Carney Speaks in Boston, Massachusetts High      
23:01 U.K RICS House Price Balance (JUN) Medium   -2.0% -3.0%
23:50 Japan Buying Foreign Bonds (Yen) (JUL 06) Low     -¥293.4b
23:50 Japan Buying Foreign Stocks (Yen) (JUL 06) Low     ¥984.9b

 

Euro

The single currency fell in yesterday’s trading session following post data weakness. The Euro was pressured lower by weaker than expected German ZEW economic sentiment. It seems that for now, investors have left global trade war behind. The Euro also fell as the U.S Dollar strengthens broadly yesterday. Overall, the EUR/USD traded with a low of 1.1688 and a high of 1.1761 before closing the day around 1.1743 in the New York session.

 

Yen

The Japanese Yen weakened yesterday. The yen was the weakest against the British pound. Yesterday, the yen also weakened against most major currencies thanks to supportive risk sentiment and rising bond yields. Given the lack of recent first-tier economic data or significant central bank events, the yen is trading as a function of international developments. Overall, the USD/JPY traded with a low of 110.78 and a high of 111.33 before closing the day around 110.98 in the U.S session.

 

British Pound

The British Pound staged a minor recovery yesterday after taking a bruising on the back of two ministerial resignations a day earlier which threw Theresa May’s premiership into doubt. Yesterday’s upward move is likely to be driven by short covering, and it is worth noting the political situation in the UK is still fragile.  Overall, the GBP/USD traded with a low of 1.3221 and a high of 1.3299 before closing the day at 1.3273 in the New York session.

 

Canadian Dollar

The Canadian Dollar fell as investors are waiting for guidance on the economic outlook that could accompany a potential interest rate hike from the Bank of Canada today. Money markets see a greater than 90 percent chance that the central bank will lift its policy rate by 25 basis points, to 1.50 percent, which would be the fourth hike since last summer. Overall, USD/CAD traded with a low of 1.3098 and a high of 1.3143 before closing the day at 1.3110 in the New York session.

 

Australian Dollar

The Australian Dollar strengthened against all major currencies except the British pound yesterday. The Australian dollar is currently the strongest against the Japanese yen. On Monday, the Aussie rebounded against the US dollar after making its most recent bottom at 0.7310. Thanks to improving risk sentiment, the Australian dollar rebound continues. Overall, AUD/USD traded with a low of 0.7428 and a high of 0.7481 before closing the day at 0.7458 in the New York session.

 

Euro-Yen

EUR/JPY is trading above 14 and below 50, 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also issuing a bearish stance. The Relative Strength Index is above 61 and lies above the neutral zone. In general, the pair has gained 0.08%.

 

 Sterling-Yen

Currently, GBP/JPY is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 56 reading and lies above the neutral zone. On the whole, the pair has gained 0.27%.

 

 Aussie-Yen

Currently, the cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 58 reading and lies above the neutral region. In general, the pair has gained 0.05%.

 

 Euro-Sterling

This cross is currently trading above 14, 50 and 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 56 and lies above the neutral region. On the whole, the pair has lost 0.19%.

 

 Sterling-Swiss

This cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The Relative Strength Index is above 48 and lies below the neutral region. In general, the pair has gained 0.17%.

 

Appendix

  

FOREX Closing Prices for July 10, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.17521 1.17613 1.16889 1.17431 -0.0006
USD/JPY 110.8 111.335 110.783 110.98 0.1520
GBP/USD 1.32577 1.32995 1.32214 1.32732 0.0017
USD/CHF 0.99131 0.99598 0.9908 0.99167 0.0003
USD/CAD 1.31096 1.31438 1.30986 1.31109 0.0006
EUR/JPY 130.224 130.719 130.074 130.337 0.1080
GBP/JPY 146.918 147.767 146.802 147.321 0.3920
CHF/JPY 111.74 112.145 111.677 111.881 0.1160
AUD/JPY 82.715 83.128 82.616 82.764 0.0400
EUR/GBP 0.88621 0.88731 0.88183 0.8845 -0.0017
EUR/CHF 1.165 1.16567 1.16298 1.1647 -0.0002
GBP/CHF 1.31445 1.32029 1.31222 1.31644 0.0022

  

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1629 1.1659 1.1701 1.1731 1.1773 1.1804 1.1846
USD/JPY 110.18 110.48 110.73 111.03 111.28 111.58 111.83
GBP/USD 1.3152 1.3187 1.3230 1.3265 1.3308 1.3343 1.3386
USD/CHF 0.9845 0.9876 0.9897 0.9928 0.9948 0.9980 1.0000
USD/CAD 1.3047 1.3073 1.3092 1.3118 1.3137 1.3163 1.3182
EUR/JPY 129.39 129.73 130.03 130.38 130.68 131.02 131.32
GBP/JPY 145.86 146.33 146.83 147.30 147.79 148.26 148.76
CHF/JPY 111.19 111.43 111.66 111.90 112.13 112.37 112.59
AUD/JPY 82.03 82.32 82.54 82.84 83.06 83.35 83.57
EUR/GBP 0.8763 0.8791 0.8818 0.8845 0.8873 0.8900 0.8927
EUR/CHF 1.1605 1.1618 1.1632 1.1645 1.1659 1.1671 1.1686
GBP/CHF 1.3043 1.3082 1.3123 1.3163 1.3204 1.3244 1.3285

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 Jul 2018

 FOREX Newsletter

         

FOREX Newsletter

July 10, 2018

 

 

Pulse of the Market

·      The U.S Dollar traded lower after the latest U.S jobs report pointed to sluggish wage growth

·      Sterling was higher climbing 0.53% to 1.3356, having recovered from a low of 1.3284

·      The single currency gained after data showed that German exports rose by more than imports

·      The trade sensitive Australian dollar Strengthened, with its highest level since mid-June

 

The US Dollar traded lower against all of the major currencies in the first few days of the third quarter. While it may be tempting to call this a peak, it is too early for all the bulls to retreat. However, all of the major currencies traded higher against the greenback with EUR/USD ending the week above 1.17. AUD/USD also saw gains, its rally stopped at the top of its 3-week range. Most importantly, USD/JPY ended the week above 110 because even though Friday’s labor market report fell short of expectations, the data is strong enough for the Federal Reserve to proceed with raising interest rates. Sterling should be trading much higher but unfortunately, Prime Minister May’s unpopular Brexit plan is hampering the currency’s rally. May is having a very difficult time gathering internal and external support for her complicated customs setup. The start of week’s trade was dominated by the drama from UK as Theresa May’s Brexit minister Davis resigned from her government in protest over her negotiating stance. Mr. Davis stated that he would not be able to deliver on her position as it would involve the UK giving up too much independence on the rulemaking front in order to stay in the customs union. Last week’s economic reports showed widespread improvements in the UK economy. The manufacturing, service and construction sectors all saw improvements in the month of June that took the composite PMI index to its highest level in 8 months. Thanks to a strong of positive developments, euro rose to a 3-week high against the US dollar. After reaching a deal with the EU on migration, Angela Merkel averted a collapse of Germany’s government by securing an agreement with her coalition partner the Christian Social Union.
Time(GMT)   Economic Release IMP Actual Forecast Prior
01:30 Australia NAB Business Confidence (JUN) Medium     6
01:30 China Producer Price Index (YoY) (JUN) Medium   4.5% 4.1%
01:30 China Consumer Price Index (YoY) (JUN) High   1.9% 1.8%
06:00 Japan Machine Tool Orders (YoY) (JUN) Medium     14.9%
08:30 U.K Visible Trade Balance (Pounds) (MAY) Medium   -£12,000 -£14,035
08:30 U.K Industrial Production (YoY) (MAY) Medium   1.9% 1.8%
08:30 U.K Manufacturing Production (YoY) (MAY) Medium   1.9% 1.4%
08:30 U.K Statistics Office Publishes First Monthly Estimate of GDP High      
09:00 German ZEW Survey Current Situation (JUL) Medium   78.2 80.6
09:00 German ZEW Survey Expectations (JUL) High   -18.5 -16.1
09:00 Euro-Zone ZEW Survey (Economic Sentiment) (JUL) High     -12.6
11:00 U.K NIESR Gross Domestic Product Estimate (JUN) Medium     0.2%
12:15 Canada Housing Starts (JUN) Medium   210.0k 195.6k
12:30 Canada Building Permits (MoM) (MAY) Medium   -0.5% -4.6%
14:00 U.S JOLTS Job Openings (MAY) Low   6660 6698
23:50 Japan Machine Orders (YoY) (MAY) Medium   10.2% 9.6%

 

Euro

The single currency rose to its highest since June 14 yesterday as investors bought riskier assets following favorable U.S jobs data last week. Investors appear to be ignoring the worsening trade conflict between the United States and China, preferring to focus on decent economic numbers. Data showing a healthy rise in German exports have also helped. Overall, the EUR/USD traded with a low of 1.1731 and a high of 1.1789 before closing the day around 1.1749 in the New York session.

 

Yen

The Japanese Yen ticked lower yesterday. In North American trade, USD/JPY traded up 0.09% on the day. On the release front, Japan’s current account surplus narrowed to JPY 1.85 billion, crushing the estimate of JPY 1.18 billion. Today, Japan releases machine tool reports and PPI, while the U.S publishes JOLT Jobs Openings. Overall, the USD/JPY traded with a low of 110.33 and a high of 110.88 before closing the day around 110.82 in the U.S session.

 

British Pound

The British Pound skidded lower yesterday after British foreign minister Boris Johnson resigned, with the pound falling against both the dollar and the euro. Johnson followed former Brexit minister David Davis in resigning. Davis had resigned last night in opposition to Prime Minister Theresa May’s plan for life after leaving the European Union.  Overall, the GBP/USD traded with a low of 1.3187 and a high of 1.3360 before closing the day at 1.3255 in the New York session.

 

Canadian Dollar

The Canadian Dollar weakened pulling back from a nearly four-week high, as investors weighed whether cautious language might accompany an expected BOC interest rate hike. The BOC likely hike interest rates as strong job growth and rising inflation pressures override concerns about a deepening trade rift with the United States, a Reuters poll found. Overall, USD/CAD traded with a low of 1.3063 and a high of 1.3120 before closing the day at 1.3104 in the New York session.

 

Australian Dollar

The Australian Dollar has suffered against its US counterpart since the start of the year and the signs aren’t looking favorable for a sustained recovery in the currency any time soon. The Australian dollar traded at US74.33¢ on Monday, with the currency lifted by Friday’s well-received US payrolls data, which weighed down the greenback. Overall, AUD/USD traded with a low of 0.7460 and a high of 0.7466 before closing the day at 0.7460 in the New York session.

 

Euro-Yen

EUR/JPY is trading above 14 and below 50, 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also issuing a bearish stance. The Relative Strength Index is above 59 and lies above the neutral zone. In general, the pair has gained 0.43%.

 

Sterling-Yen

Currently, GBP/JPY is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 54 reading and lies above the neutral zone. On the whole, the pair has gained 0.17%.

 

Aussie-Yen

Currently, the cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 55 reading and lies above the neutral region. In general, the pair has gained 0.81%.

 

 Euro-Sterling

This cross is currently trading above 14, 50 and 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 0.22%.

   

Sterling-Swiss

This cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The Relative Strength Index is above 46 and lies below the neutral region. In general, the pair has lost 0.12%.

 

Appendix

  

FOREX Closing Prices for July 09, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.17503 1.17892 1.17313 1.17494 0.0005
USD/JPY 110.451 110.883 110.333 110.828 0.4040
GBP/USD 1.33103 1.33608 1.31879 1.32558 -0.0027
USD/CHF 0.98896 0.99283 0.9856 0.99133 0.0008
USD/CAD 1.3092 1.31205 1.30638 1.31048 0.0004
EUR/JPY 129.798 130.235 129.659 130.229 0.5620
GBP/JPY 147.034 147.589 146.088 146.929 0.2540
CHF/JPY 111.652 112.009 111.546 111.765 0.2640
AUD/JPY 82.093 82.77 81.986 82.724 0.6620
EUR/GBP 0.88257 0.88999 0.88116 0.88619 0.0020
EUR/CHF 1.16223 1.16542 1.16036 1.16491 0.0017
GBP/CHF 1.31656 1.31991 1.30847 1.3142 -0.0015

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1666 1.1699 1.1724 1.1757 1.1782 1.1815 1.1840
USD/JPY 109.93 110.13 110.48 110.68 111.03 111.23 111.58
GBP/USD 1.3003 1.3095 1.3176 1.3268 1.3348 1.3441 1.3521
USD/CHF 0.9798 0.9827 0.9870 0.9899 0.9942 0.9972 1.0015
USD/CAD 1.3016 1.3040 1.3072 1.3096 1.3129 1.3153 1.3186
EUR/JPY 129.27 129.47 129.85 130.04 130.42 130.62 131.00
GBP/JPY 144.65 145.37 146.15 146.87 147.65 148.37 149.15
CHF/JPY 111.07 111.31 111.54 111.77 112.00 112.24 112.46
AUD/JPY 81.43 81.71 82.22 82.49 83.00 83.28 83.78
EUR/GBP 0.8727 0.8770 0.8816 0.8858 0.8904 0.8946 0.8992
EUR/CHF 1.1566 1.1585 1.1617 1.1636 1.1668 1.1686 1.1718
GBP/CHF 1.2970 1.3028 1.3085 1.3142 1.3199 1.3256 1.3314

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.

 

 

09 Jul 2018

FOREX Newsletter

      

FOREX Newsletter

July 09, 2018
 

 

  Pulse of the Market

·      The U.S economy added 213,000 jobs in June, above forecasts for 200,000 new jobs

·      U.S unemployment rate unexpectedly rose to 4%, the Labor Department said on Friday

·      Sterling gained almost 0.5% last week to snap a three-week 1.5% decline

·      U.S and China trade tariffs kicked in Friday, raising the prospect of a trade war

 

 

The U.S Dollar slumped against its rivals Friday, on mixed U.S. economic data showing the economy created more jobs than expected but wage growth undershot estimates. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell by 0.34% to 93.81. The U.S. economy added 213,000 jobs in June, above forecasts for 200,000 new jobs while the unemployment rate unexpectedly rose to 4%, the Labor Department said on Friday. The Federal Reserve’s view that a tighter labor market would lead to wage growth, increasing inflationary pressures, continues to be challenged as average hourly earnings grew slower-than-expected for the month. Average hourly earnings grew 0.2%, undershooting economists’ forecast for a 0.3% increase. The weaker average hourly earnings print scaled back some bullish investor expectations for two Fed rate hikes this year. The softer average earnings indicator is likely to catch more attention as it highlights a still tame wage inflation environment. That could lead some market participants to start questioning whether we will see two Fed rate rises in second after all. The dollar was also weighed down by an uptick in the Canadian dollar as upbeat employment data, reaffirmed investor expectations that the Bank of Canadian would hike interest rates by 25 basis points next week. U.S, and China trade tariffs kicked in Friday, raising the prospect of a trade war between the world’s largest economic superpowers, but the reaction in safe-haven currencies was muted, as some said markets had priced in the impact. The Canadian Dollar will climb over the coming year, a Reuters poll showed, but forecasters are less bullish than they were a month ago as escalating trade uncertainty competes with expected Bank of Canada interest rate hikes. The poll of more than 40 foreign exchange strategists predicted the Canadian dollar will rise to C$1.30 to the greenback, or 76.92 U.S. cents, in three months, from around C$1.3140 on Thursday. Hawkish comments last week by Bank of Canada Governor Stephen Poloz have left money markets largely expecting the central bank to lift its benchmark interest rate, which sits at 1.25 percent, by 25 basis points next week.

 

  

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
04:30 Japan Bankruptcies (YoY) (JUN) Medium     -4.36%
05:45 Switzerland Unemployment Rate (JUN) Medium     2.4%
06:00 German Trade Balance (MAY) Medium     20.4b
06:00 German Current Account (euros) (MAY) Low     22.7b
08:00 Switzerland Total Sight Deposits CHF (6 JUL) Low      
08:30 Euro-Zone Sentix Investor Confidence (JUL) Low     9.3
19:00 U.S Consumer Credit (MAY) Medium     $9.262b
22:45 New Zealand Card Spending Retail (MoM) (JUN) Low     0.4%
22:45 New Zealand Card Spending (MoM) (JUN) Low     0.5%
23:01 U.K BRC Sales Like-For-Like (YoY) (JUN) Low     2.8%
23:30 ANZ Roy Morgan Weekly Consumer Confidence Index (8 JUL) Low      

 

Euro

The single currency jumped in Friday’s trading session. The Euro was supported by the strong industrial production data from the Eurozone’s biggest economy and a Bloomberg report mentioning that some ECB members believe that postponing the first hike in the Euro Area until late-2019 could prove to be too late. Overall, the EUR/USD traded with a low of 1.1678 and a high of 1.1765 before closing the day around 1.1744 in the New York session.

 

Yen

The Japanese Yen pair closed lower last week in reaction to concerns over a fourth rate hike by the U.S. Federal Reserve and safe-haven buying due to the escalation of the trade dispute between the United States and China. Both factors contributed to lower Treasury yields which made the U.S Dollar a less-attractive asset.  Overall, the USD/JPY traded with a low of 110.36 and a high of 110.76 before closing the day around 110.42 in the U.S session.

 

British Pound

The British Pound continues to be very noisy in general, as we have around the 1.32 level. It looks as of the 1.30 level underneath is trying to for some type of significant support and at this point I think it’s very difficult to imagine that this market will break down below. The only thing keeping this market down is the uncertainty between the UK and the EU. Overall, the GBP/USD traded with a low of 1.3201 and a high of 1.3288 before closing the day at 1.3283 in the New York session.

 

Canadian Dollar

The Canadian Dollar is expected to climb over the coming year, a Reuter’s poll showed, but forecasters are less bullish than they were a month ago as escalating trade uncertainty competes with expected Bank of Canada interest-rate hikes. The poll of more than 40 foreign-exchange strategists predicted the Canadian dollar will rise. Overall, USD/CAD traded with a low of 1.3074 and a high of 1.3148 before closing the day at 1.3100 in the New York session.

 

Australian Dollar

The Australian Dollar enjoyed a reprieve last week from the recent relentless selling pressure that had pushed the currencies to multi-year lows. Nothing happened domestically to trigger the technical reversals on the weekly charts. However, due to a shift in investor sentiment on the U.S Dollar, Aussie sellers were forced to make aggressive position-adjustments, sending prices higher. Overall, AUD/USD traded with a low of 0.7374 and a high of 0.7442 before closing the day at 0.7432 in the New York session.

 

 

Euro-Yen

EUR/JPY is trading above 14 and below 50, 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also issuing a bearish stance. The Relative Strength Index is above 56 and lies above the neutral zone. In general, the pair has gained 0.24%.

 

 

Sterling-Yen

Currently, GBP/JPY is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 52 reading and lies above the neutral zone. On the whole, the pair has gained 0.22%.

 

 

Aussie-Yen

Currently, the cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 50 reading and lies above the neutral region. In general, the pair has gained 0.33%.

 

 

Euro-Sterling

This cross is currently trading above 14, 50 and 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 56 and lies above the neutral region. On the whole, the pair has lost 0.02%.

 

  

Sterling-Swiss

This cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The Relative Strength Index is above 48 and lies below the neutral region. In general, the pair has gained 0.17%.

 

 

 Appendix

  

FOREX Closing Prices for July 06, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.16894 1.17659 1.16786 1.17441 0.0052
USD/JPY 110.55 110.767 110.361 110.424 -0.2210
GBP/USD 1.32176 1.32884 1.32016 1.32832 0.0058
USD/CHF 0.993 0.99421 0.98824 0.99053 -0.0030
USD/CAD 1.31318 1.31484 1.30744 1.31009 -0.0031
EUR/JPY 129.248 129.944 129.219 129.667 0.3090
GBP/JPY 146.276 146.734 146.098 146.675 0.3250
CHF/JPY 111.333 111.726 111.237 111.501 0.1070
AUD/JPY 81.643 82.226 81.558 82.062 0.3100
EUR/GBP 0.88437 0.88659 0.88343 0.88423 -0.0002
EUR/CHF 1.16125 1.16376 1.16032 1.16316 0.0017
GBP/CHF 1.31316 1.31607 1.31114 1.31574 0.0022

 

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1606 1.1642 1.1693 1.1730 1.1780 1.1817 1.1868
USD/JPY 109.86 110.11 110.27 110.52 110.67 110.92 111.08
GBP/USD 1.3140 1.3171 1.3227 1.3258 1.3314 1.3345 1.3401
USD/CHF 0.9818 0.9850 0.9878 0.9910 0.9937 0.9970 0.9997
USD/CAD 1.2993 1.3034 1.3067 1.3108 1.3141 1.3182 1.3215
EUR/JPY 128.55 128.89 129.28 129.61 130.00 130.34 130.73
GBP/JPY 145.63 145.87 146.27 146.50 146.91 147.14 147.54
CHF/JPY 110.76 111.00 111.25 111.49 111.74 111.98 112.23
AUD/JPY 81.00 81.28 81.67 81.95 82.34 82.62 83.01
EUR/GBP 0.8798 0.8816 0.8829 0.8848 0.8861 0.8879 0.8892
EUR/CHF 1.1576 1.1590 1.1611 1.1624 1.1645 1.1659 1.1679
GBP/CHF 1.3076 1.3094 1.3126 1.3143 1.3175 1.3192 1.3224

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.