09 八月 2018

FOREX Newsletter

FOREX Newsletter

August 09, 2018

 

  Pulse of the Market

·      The Dollar edged lower against a currency basket of currencies yesterday, sliding for a second day

·      The Euro hovered around the $1.16 yesterday but failed to capitalize on a pause in the Dollar’s rally

·      The recent rally in the Dollar has faded as investor concerns over global trade tensions waned

·      The BOJ board members had disagreed on how far interest rates should be allowed to move

The U.S Dollar edged higher yesterday as investors worried about trade tensions and examined the Bank of Japan’s recent shift in interest-rate policy. The euro hovered around the $1.16 mark on Wednesday but failed to capitalize on a pause in the dollar’s rally, while solid data out of China calmed nerves about recent Sino-U.S trade tensions. The dollar has weakened since hitting a three-week high on Monday, when the prospect of a full-blown trade war increased demand for the currency. Traders said the dollar needed a fresh impetus or an escalation in the trade tensions to move higher. The Chinese trade data, coupled with the PBOC moves, is helping quieting markets, with range-bound trading. The People’s Bank of China announced last week that it would impose a reserve requirement on FX forwards and wanted to see a stable Yuan. China’s currency has since recovered some of its losses but was 0.2 weaker at 6.8380 in offshore markets, still off last week’s 6.9125 lows. Traders say market sensitivity to trade war headlines has diminished and investors will want to see evidence the dispute is having real impact before they panic. In a reminder the dispute has not disappeared, however, the U.S. Trade Representative’s office said on Tuesday that the U.S would begin collecting 25 percent tariffs on another $16 billion of Chinese goods later this month. The yen rose half a percent after reports that Bank of Japan board members had disagreed on how far interest rates should be allowed to move from the central bank’s target. The Yen rose to 110.84, a one-week high. The pound fell to the lowest levels of the year yesterday as the currency was pressured lower by growing fears over the prospect of Britain exiting the European Union without a trade deal in place. Sentiment on the pound has soured after Britain’s International Trade Secretary Liam Fox said in an interview published in the Sunday Times newspaper there was a 60:40 chance that the UK would leave the European Union without an agreement.

 

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
01:30 China Producer Price Index (YoY) (JUL) Medium 4.5% 4.7%
01:30 China Consumer Price Index (YoY) (JUL) High 2.0% 1.9%
05:45 Switzerland Unemployment Rate (JUL) Medium 2.4% 2.4%
06:00 Japan Machine Tool Orders (YoY) (JUL) Medium 11.4%
08:00 ECB Publishes Economic Bulletin (JUL) Medium
12:15 Canada Housing Starts (JUL) Medium 219.5k 248.1k
12:30 Canada New Housing Price Index (YoY) (JUN) Medium 0.7% 0.9%
12:30 U.S Initial Jobless Claims (AUG 4) Medium 220k
12:30 U.S Continuing Claims (JUL 28) Medium 1735k
12:30 U.S Producer Price Index Final Demand (YoY) (JUL) Low 3.4% 3.4%
13:00 Mexico CPI (YoY) (JUL) High 4.81% 4.65%
14:00 U.S Wholesale Inventories (MoM) (JUN) Low 0.0% 0.0%
14:00 U.S Wholesale Trade Sales (MoM) (JUN) Low 2.5%
23:50 Japan Gross Domestic Product Annualized s.a. (QoQ) (2Q) High 1.4% -0.6%

 

Euro

The single currency was steady against the Dollar in yesterday’s trading session but the currency will be increasingly vulnerable to losses over coming weeks as the new Italian government thrashes out its 2019 budget plan ahead of a possible showdown with EU fiscal hawks in Brussels toward the end of the year. Overall, the EUR/USD traded with a low of 1.1571 and a high of 1.1626 before closing the day around 1.1611 in the New York session.

 

Yen

The Japanese Yen pair fell as we continue to see a lot of noise in this market. The ¥111 level underneath does offer quite a bit of demand though that could turn things around and have the buyers jumping back in. The market of course continues to react to the trade war fears and the like, so this could be a bit of “Ground Zero” for reaction to the headlines.  Overall, the USD/JPY traded with a low of 110.81 and a high of 111.41 before closing the day around 110.99 in the U.S session.

 

British Pound

The British Pound fell to the lowest level in more than nine months against the euro in yesterday’s session amid growing concern that the U.K could end up leaving the European Union with no agreement for future economic ties. Investors have turned more bearish on the U.K. currency as the Brexit deadline approaches. Overall, the GBP/USD traded with a low of 1.2851 and a high of 1.2958 before closing the day at 1.2883 in the New York session.

 

Canadian Dollar

The Canadian Dollar weakened to a two-week low earlier in the session but pared its losses as investors decided that the impact on the currency of potential Canadian asset sales will be short-lived. The Saudi central bank and state pension funds have instructed their overseas asset managers to dispose of their Canadian equities, bonds and cash holdings. Overall, USD/CAD traded with a low of 1.3004 and a high of 1.3117 before closing the day at 1.3024 in the New York session.

 

Australian Dollar

The Australian Dollar gained yesterday, thanks to a recent RBA event. RBA Governor Philip Lowe has given a speech which has raised AUD trader confidence; Mr. Lowe stressed that the next interest rate change would likely be a hike instead of a cut. While Mr. Lowe didn’t indicate when interest rates could be increased, this assertion and his broadly positive outlook have enabled Aussie gains. Overall, AUD/USD traded with a low of 0.7381 and a high of 0.7437 before closing the day at 0.7435 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 42 and lies below the neutral zone. In general, the pair has lost 0.4%.

 

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 29 reading and lies below the neutral zone. On the whole, the pair has lost 0.77%.

  

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 50 reading and lies above the neutral region. In general, the pair has lost 0.17%.

  

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 70 and lies above the neutral region. On the whole, the pair has gained 0.57%.

 

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 26 and lies below the neutral region. In general, the pair has lost 0.63%.

 

Appendix

 

FOREX Closing Prices for August 08, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.15977 1.16268 1.15718 1.16115 0.0014
USD/JPY 111.359 111.419 110.818 110.993 -0.3720
GBP/USD 1.29372 1.29581 1.28519 1.28831 -0.0054
USD/CHF 0.99538 0.9969 0.99261 0.99342 -0.0020
USD/CAD 1.30518 1.31178 1.30044 1.30243 -0.0026
EUR/JPY 129.166 129.433 128.535 128.853 -0.3100
GBP/JPY 144.081 144.254 142.704 142.985 -1.1140
CHF/JPY 111.842 111.998 111.304 111.744 -0.1030
AUD/JPY 82.629 82.764 82.0748 82.487 -0.1370
EUR/GBP 0.89621 0.90151 0.89574 0.90132 0.0051
EUR/CHF 1.1544 1.15552 1.15252 1.15333 -0.0012
GBP/CHF 1.28792 1.28863 1.27904 1.27981 -0.0082

 

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1525 1.1548 1.1580 1.1603 1.1635 1.1658 1.1690
USD/JPY 110.13 110.48 110.73 111.08 111.34 111.68 111.94
GBP/USD 1.2731 1.2792 1.2837 1.2898 1.2944 1.3004 1.3050
USD/CHF 0.9874 0.9900 0.9917 0.9943 0.9960 0.9986 1.0003
USD/CAD 1.2866 1.2935 1.2980 1.3049 1.3093 1.3162 1.3207
EUR/JPY 127.55 128.04 128.45 128.94 129.35 129.84 130.24
GBP/JPY 140.82 141.76 142.37 143.31 143.92 144.86 145.47
CHF/JPY 110.67 110.99 111.37 111.68 112.06 112.38 112.75
AUD/JPY 81.43 81.75 82.12 82.44 82.81 83.13 83.50
EUR/GBP 0.8918 0.8938 0.8975 0.8995 0.9033 0.9053 0.9091
EUR/CHF 1.1491 1.1508 1.1521 1.1538 1.1551 1.1568 1.1581
GBP/CHF 1.2668 1.2729 1.2764 1.2825 1.2859 1.2921 1.2955

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

 

 

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