08 八月 2018

FOREX Newsletter

   

FOREX Newsletter

August 08, 2018

 

Pulse of the Market

·      Trade uncertainty has boosted the Greenback in the last few months

·      U.S economic data showed U.S job openings undershot economists’ estimates

·      Sterling was higher despite worry over the possibility of a no-deal Brexit

·      The RBA statement was mixed with central bank downgrading its inflation outlook

The U.S Dollar fell against its rivals yesterday, pressured by a rise in the Chinese Yuan as the People’s Bank of China reportedly made a fresh attempt to steady the currency. The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, rose by 0.22% to 94.99. The People’s Bank of China, PBoC, urged some lenders to prevent any “herd behavior” in the currency market, Bloomberg reported, citing people familiar with the matter. Some said the request from China’s central bank was an attempt at curbing large banks from initiating the same positions as clients, or engaging in “herd behavior,” amid a recent wave of bets against the yuan. The move helped stabilized the offshore yuan and arrived just days after the PBoC on Friday raised the cost of shorting the currency. A falling yuan runs the risk of large investment outflows from the China at a time of heightened concerns that President Donald Trump could up the trade-war ante with harsher trade penalties, stifling China’s economy. U.S. economic data showing U.S. job openings undershot economists’ estimates did little to help the greenback’s attempt at paring losses. The U.S. Labor Department’s latest Job Openings and Labor Turnover Survey (JOLTS) report, a measure of labor demand, showed job openings in June came in at 6.66 million, missing expectations of 6.74 million. Elsewhere, a stronger euro also weighed on the dollar, despite a steeper-than-expected decline in German industrial production. Sterling was also higher, with GBP/USD rising 0.07% to 1.2952, despite worry over the possibility of a no-deal Brexit. The Australian dollar recovered with AUD/USD up 0.51% to 0.7425, while NZD/USD was up 0.09% to 0.6738. The loonie was lower against the greenback, with USD/CAD up 0.08% to 1.3014. Canada runs a current account deficit, so its economy could be hurt if the flow of trade or capital slows. The country is in talks with the United States and Mexico to revamp the North American Free Trade Agreement. Canadian government bond prices were lower across a flatter yield curve. The only event risk on the docket was the RBA rate decision which proved to be a non-mover as expected with the central bank holding rates steady for 19th consecutive month.

 

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
01:30 Australia Home Loans (MoM) (JUN) Medium   0.0% 1.1%
03:05 RBA Governor Lowe Speech in Sydney (AUG 8) High      
04:30 Japan Bankruptcies (YoY) (JUL) Medium     -2.26%
05:00 Japan Eco Watchers Survey Current (JUL) Medium   47.8 48.1
11:00 U.S MBA Mortgage Applications (AUG 3) Medium      
12:30 Canada Building Permits (MoM) (JUN) Medium   -1.2% 4.7%
14:30 DOE U.S. Crude Oil Inventories (AUG 3) Medium      
21:00 RBNZ Official Cash Rate (AUG 9) High   1.75% 1.75%
23:01 U.K RICS House Price Balance (JUL) Medium   3.0% 2.0%
23:50 Japan Housing Loans (YoY) (2Q) Medium     2.7%
23:50 Japan Machine Orders (YoY) (JUN) Medium   10.0% 16.5%

 

Euro

The single currency edged higher yesterday, bouncing from a near six-week low hit in the previous session, though major currencies remained trapped in broad ranges as investors hunted for fresh triggers in foreign exchange markets. Financial markets expect another 40 basis points in rate increases from the US Federal Reserve. Overall, the EUR/USD traded with a low of 1.1549 and a high of 1.1606 before closing the day around 1.1597 in the New York session.

 

Yen

The Japanese Yen was slightly higher against the US dollar, while weakening against all other major currencies. Yesterday, the yen ended the day slightly lower against the US dollar. Following last week’s Bank of Japan meeting, trading volumes in the yen have been falling for the last five trading sessions in a row.  Overall, the USD/JPY traded with a low of 110.97 and a high of 111.46 before closing the day around 111.36 in the U.S session.

 

British Pound

The British Pound has stabilized a little after this week’s drop to an 11 month low on growing concerns about a no-deal Brexit. It has gained a little ground against the dollar – up 0.03% – but is still in negative territory against the euro – down 0.37%. On the economic front, UK house prices grew by 1.4% month on month in July. Overall, the GBP/USD traded with a low of 1.2921 and a high of 1.2971 before closing the day at 1.2937 in the New York session.

 

Canadian Dollar

The Canadian Dollar strengthened to a nearly eight-week high against its U.S counterpart yesterday as oil prices rose and the greenback broadly fell. The price of oil, one of Canada’s major exports, was boosted by revived U.S. sanctions against major crude exporter Iran that could tighten global supply. U.S crude prices were up 0.8 per cent at $69.53 a barrel. Overall, USD/CAD traded with a low of 1.2960 and a high of 1.3073 before closing the day at 1.3050 in the New York session.

 

Australian Dollar

The Australian Dollar firmed against the US Dollar (USD) yesterday. This is the best level of AUD/USD trading in a week and comes from growing risk sentiment after a high-impact Reserve Bank of Australia (RBA) meeting. RBA officials left interest rates on hold at 1.5% as expected, but there were hints about a potential rate hike coming in 2019 or 2020. Overall, AUD/USD traded with a low of 0.7380 and a high of 0.7437 before closing the day at 0.7421 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 also issuing a bearish stance. The Relative Strength Index is above 45 and lies below the neutral zone. In general, the pair has gained 0.34%.

 

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 34 reading and lies below the neutral zone. On the whole, the pair has lost 0.09%.

  

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 52 reading and lies above the neutral region. In general, the pair has gained 0.39%.

  

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 66 and lies above the neutral region. On the whole, the pair has gained 0.39%.

  

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 31 and lies below the neutral region. In general, the pair has lost 0.21%.

 

 

Appendix

  

FOREX Closing Prices for August 07, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.15515 1.16067 1.15492 1.15972 0.0042
USD/JPY 111.387 111.46 110.973 111.365 -0.0500
GBP/USD 1.2942 1.29719 1.29219 1.29375 -0.0008
USD/CHF 0.99625 0.99671 0.99288 0.99538 -0.0013
USD/CAD 1.30008 1.3073 1.296 1.30507 0.0046
EUR/JPY 128.68 129.209 128.571 129.163 0.4370
GBP/JPY 144.168 144.414 143.783 144.099 -0.1250
CHF/JPY 111.783 111.935 111.621 111.847 0.0520
AUD/JPY 82.259 82.727 82.147 82.624 0.3170
EUR/GBP 0.89235 0.89641 0.89209 0.89617 0.0035
EUR/CHF 1.15099 1.15466 1.1509 1.1545 0.0028
GBP/CHF 1.28923 1.29116 1.28664 1.28798 -0.0027

 

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1505 1.1527 1.1562 1.1584 1.1620 1.1642 1.1677
USD/JPY 110.59 110.78 111.07 111.27 111.56 111.75 112.05
GBP/USD 1.2866 1.2894 1.2916 1.2944 1.2966 1.2994 1.3016
USD/CHF 0.9894 0.9912 0.9933 0.9950 0.9971 0.9988 1.0009
USD/CAD 1.2870 1.2915 1.2983 1.3028 1.3096 1.3141 1.3209
EUR/JPY 128.12 128.34 128.75 128.98 129.39 129.62 130.03
GBP/JPY 143.15 143.47 143.78 144.10 144.41 144.73 145.05
CHF/JPY 111.35 111.49 111.67 111.80 111.98 112.12 112.30
AUD/JPY 81.69 81.92 82.27 82.50 82.85 83.08 83.43
EUR/GBP 0.8891 0.8906 0.8934 0.8949 0.8977 0.8992 0.9020
EUR/CHF 1.1483 1.1496 1.1520 1.1534 1.1558 1.1571 1.1596
GBP/CHF 1.2815 1.2841 1.2860 1.2886 1.2905 1.2931 1.2951

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

 

 

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