13 Дек 2018

FOREX Newsletter

FOREX Newsletter

December 13, 2018


 

Pulse of the Market

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

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

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

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

 

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

 

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

Euro

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

 

Yen

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

 

British Pound

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

 

Canadian Dollar

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

 

Australian Dollar

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

 

Euro-Yen

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

 

Sterling-Yen

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

  

Aussie-Yen

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

 

Euro-Sterling

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

 

Sterling-Swiss

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

 

Appendix

  

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

  

 

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

 

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

 

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