27 Июн 2018

FOREX Newsletter

      

  FOREX Newsletter

  June 27, 2018

  Pulse of the Market

·      Markets regained composure after remarks by White House trade adviser Peter Navarro

·      The Treasury Department is due to announce restrictions on Chinese investment in the U.S by Friday

·      Incoming BOE policymaker Jonathan Haskel said that there may be slacker in the UK economy

·      Trade tensions and NAFTA tape bombs are the fastest growing risks , leaving the loonie sensitive

The U.S Dollar rose to the day’s highs against a currency basket yesterday as market sentiment recovered a day after mounting trade tensions sparked a selloff in risky assets. The U.S dollar index, which measures the greenback’s strength against a basket of six major currencies, was up 0.32% to 94.25 after ending the previous session down 0.24%. The greenback had been pressured lower as long-term U.S. Treasury yields slid amid heightened risk aversion in financial markets. Markets regained composure after remarks by White House trade adviser Peter Navarro Monday helped ease some investor concerns about U.S. trade policy. Navarro indicated that plans to bar Chinese companies from investing in U.S. technology firms won’t be as damaging to the economy as markets are anticipating. The Treasury Department is due to announce restrictions on Chinese investment in the U.S by Friday. Such a move would counter a Chinese initiative to be a global leader in technology and mark another escalation in the trade conflict between Washington and Beijing, following the threat of tit-for-tat tariffs. Besides the trade dispute with China, U.S. President Donald Trump has ratcheted up trade tensions with the European Union by threatening tariffs on cars imported from the bloc. The dollar was still a touch lower against the yen, with USD/JPY last at 109.72, having fallen to a two-week low of 109.36 on Monday. The safe haven yen is often sought by investors in times of geopolitical tensions and market turmoil. The euro fell to the day’s lows, with EUR/USD down 0.38% to 1.1658 after edging up to a two-week high. Sterling was also lower against the firmer dollar, with GBP/USD sliding 0.35%. The pound came under pressure after incoming Bank of England policymaker Jonathan Haskel said that there may be slacker in the UK economy, which would weaken the case for interest rate hikes. He added that the central bank has scope to cut rates slightly lower in case of an economic downturn. The Canadian Dollar is on the verge of another leg down that could see it reach fresh multi-year lows against the US Dollar in the weeks ahead.

 

  
Time(GMT)   Economic Release IMP Actual Forecast Prior
01:00 New Zealand ANZ Activity Outlook (JUN) Medium     13.6
08:30 BOE’s Carney Speaks About Financial Stability Report High      
11:00 U.S MBA Mortgage Applications (JUN 22) Medium     5.1%
12:30 U.S Wholesale Inventories (MoM) (MAY) Medium   0.2% 0.1%
12:30 U.S Advance Goods Trade Balance (MAY) High   -$69.0b -$68.2b
12:30 U.S Durable Goods Orders (MAY) High   -0.9% -1.6%
12:30 U.S Durables Ex Transportation (MAY) Medium   0.5% 0.9%
14:00 U.S Pending Home Sales (YoY) (MAY) Medium     0.4%
14:30 DOE U.S. Crude Oil Inventories (JUN 22) Medium     -5914k
16:15 U.S Fed’s Rosengren Speaks on Ethics and Economics Low      
19:00 Bank of Canada Governor Stephen Poloz Gives Speech in Victoria High      
21:00 RBNZ Official Cash Rate (JUN 28) High   1.75% 1.75%

 

Euro

The single currency ended yesterday’s trading session lower. EU summit that was supposed to be dominated by unity on a common problem has instead turned into discord. As of a month ago, this week’s gathering of EU heads of government in Brussels was set to focus on Brexit. The UK was expected to finally present its plans for the future relationship. Overall, the EUR/USD traded with a low of 1.1633 and a high of 1.1719 before closing the day around 1.1646 in the New York session.

 

Yen

The Japanese Yen pair built on its intraday recovery from two-week lows and is now looking to build on its momentum back above the key 110.00 psychological mark. Against the backdrop of a goodish pickup in the US Dollar demand, a positive opening across the US equity markets weighed on the Japanese Yen’s safe-haven appeal. Overall, the USD/JPY traded with a low of 109.35 and a high of 110.19 before closing the day around 110.01 in the U.S session.

 

British Pound

The British Pound fell after comments by John Haskel, an incoming member of the Monetary Policy Committee of the Bank of England. Haskel was a relatively unknown voice until now, and his dovish commentary and the concerns he voiced for the possible impact on the British economy after the Brexit resulted in a swift sell off for the Pound. Overall, the GBP/USD traded with a low of 1.3190 and a high of 1.3290 before closing the day at 1.3221 in the New York session.

 

Canadian Dollar

The Canadian Dollar continues to have a quiet week. Yesterday North American session, USD/CAD is traded up 0.19% on the day. On the release front, there were no Canadian events until Thursday, so U.S indicators will have an added impact on the movement of USD/CAD. The Bank of Canada has dropped hints that it is ready to raise rates in the second half of 2018. Overall, USD/CAD traded with a low of 1.3278 and a high of 1.3327 before closing the day at 1.3304 in the New York session.

 

Australian Dollar

The Australian Dollar continued to struggle through yesterday as a lack of any meaningful data for release to start of the week hindered any chance of movements higher. The Aussie dollar was dragged down once again by ongoing trade tensions and a drop-in equity prices. Aussie was one of the worst performing currencies of the day. Overall, AUD/USD traded with a low of 0.7378 and a high of 0.7421 before closing the day at 0.7388 in the New York session.

 

 

Euro-Yen

EUR/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also issuing a bearish stance. The Relative Strength Index is above 42 and lies below the neutral zone. In general, the pair has lost 0.28%.

 

 Sterling-Yen

Currently, GBP/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 41 reading and lies below the neutral zone. On the whole, the pair has lost 0.18%.

  

Aussie-Yen

 

 

Currently, the cross is trading below 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 40 reading and lies below the neutral region. In general, the pair has lost 0.08%.

 

 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 53 and lies above the neutral region. On the whole, the pair has lost 0.07%.

 

 Sterling-Swiss

This cross is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bearish stance and MACD is indicating a bullish tone. The Relative Strength Index is above 37 and lies below the neutral region. In general, the pair has lost 0.06%.

 

 

Appendix

 

FOREX Closing Prices for June 26, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.17018 1.1719 1.16335 1.16461 -0.0059
USD/JPY 109.751 110.197 109.35 110.016 0.2420
GBP/USD 1.32777 1.32901 1.31906 1.32211 -0.0060
USD/CHF 0.98675 0.99213 0.98565 0.99047 0.0034
USD/CAD 1.32925 1.3327 1.32785 1.33048 0.0006
EUR/JPY 128.46 128.481 127.777 128.158 -0.3550
GBP/JPY 145.752 145.778 144.948 145.503 -0.2690
CHF/JPY 111.182 111.231 110.74 111.018 -0.2230
AUD/JPY 81.339 81.425 80.935 81.337 -0.0650
EUR/GBP 0.88103 0.88207 0.87965 0.88073 -0.0006
EUR/CHF 1.15515 1.15626 1.15226 1.15365 -0.0017
GBP/CHF 1.31045 1.31266 1.30648 1.31014 -0.0008

  

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1528 1.1581 1.1613 1.1666 1.1699 1.1752 1.1784
USD/JPY 108.66 109.01 109.51 109.85 110.36 110.70 111.21
GBP/USD 1.3078 1.3134 1.3178 1.3234 1.3277 1.3333 1.3377
USD/CHF 0.9802 0.9829 0.9867 0.9894 0.9932 0.9959 0.9997
USD/CAD 1.3231 1.3255 1.3280 1.3303 1.3328 1.3352 1.3377
EUR/JPY 127.09 127.43 127.80 128.14 128.50 128.84 129.20
GBP/JPY 144.21 144.58 145.04 145.41 145.87 146.24 146.70
CHF/JPY 110.27 110.51 110.76 111.00 111.25 111.49 111.74
AUD/JPY 80.55 80.74 81.04 81.23 81.53 81.72 82.02
EUR/GBP 0.8771 0.8784 0.8796 0.8808 0.8820 0.8832 0.8844
EUR/CHF 1.1479 1.1501 1.1519 1.1541 1.1559 1.1581 1.1599
GBP/CHF 1.3007 1.3036 1.3069 1.3098 1.3130 1.3159 1.3192

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.