28 6 月 2018

FOREX Newsletter

      

FOREX Newsletter

June 28, 2018

 

     
Pulse of the Market

·      The U.S Dollar rose broadly yesterday, including against the Swiss franc and Japanese yen

·      Sterling weakened as imminent Brexit talks and doubts the BOE will raise interest rates this year

·      The euro fell from the threat of a political crisis in Germany and uncertainty over EU summit

·      Despite easing in trade tensions, the trade-sensitive Australian dollar remained under pressure

 

The U.S dollar rose sharply against its rivals yesterday, as a rout of safe-haven currencies prompted traders to pile into the greenback after the White House softened its stance on restricting foreign investment. The U.S dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.48% to 94.81. U.S President Donald Trump said he would back Congress’ passage of the Foreign Investment Risk Review Modernization Act (FIRRMA), which would expand the powers of the Committee on Foreign Investment in the United States (CFIUS), helping it combat alleged theft of U.S. intellectual property by China. The decision to back CFIUS not the somewhat harsher International Emergency Economic Powers Act of 1977 – which would have allowed Trump to unilaterally impose restrictions – sparked risk appetite, sending safe-haven currencies like the yen and Swiss franc sharply lower against the greenback. USD/JPY rose 0.25% to Y110.34, while USD/CHF rose 0.50% 0.9962. Mixed U.S. economic data showing an unexpected narrowing of the U.S. trade deficit and weaker durable goods orders did little to curb demand for the dollar. The Commerce Department said yesterday Core Durable Goods Orders fell 0.3% last month, missing economist forecast for a 0.5% rise. The US trade deficit narrowed to $64.85 billion, well below economists’ forecasts of $68.9 billion, from a revised $67.34 billion. The dollar’s move higher was also supported by a slump in both the euro and sterling as the latter was weighed down by Brexit angst, and uncertainty as to whether the Bank of England would hike interest rates this year. USD/CAD rose 0.02% to C$1.3309 as rallying oil prices continued to support the loonie, limiting gains in the currency pair, after the Energy Information Administration’s weekly report showed a massive draw in domestic crude supplies.

 

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
06:00 German GfK Consumer Confidence (JUL) Medium   10.6 10.7
08:00 ECB Publishes Economic Bulletin Medium      
09:00 Euro-Zone Economic Confidence (JUN) Low   112 112.5
09:00 Euro-Zone Consumer Confidence (JUN) Low   -0.5 -0.5
10:00 BOE’s Bailey Speaks on the Future of Payments in London Low      
12:00 German Consumer Price Index (YoY) (JUN) High   2.2% 2.2%
12:30 U.S Initial Jobless Claims (JUN 23) Medium   220k 218k
12:30 U.S Continuing Claims (JUN 16) Medium   1718k 1723k
12:30 U.S Gross Domestic Product Annualized (QoQ) (1Q) High   2.2% 2.2%
12:30 U.S Personal Consumption (1Q) Medium   1.0% 1.0%
12:30 U.S Core PCE (QoQ) (1Q) Medium     2.3%
13:30 BOE Chief Economist Andy Haldane Speaks in London Medium      
22:45 New Zealand Building Permits (MoM) (MAY) Medium     -3.7%
23:01 U.K GfK Consumer Confidence (JUN) Medium   -7 -7
23:30 Japan Jobless Rate (MAY) Medium   2.5% 2.5%

 

Euro

The single currency was under pressure from worries about the trade conflict, the threat of a political crisis in Germany, and uncertainty over a European Union summit dealing with immigration. The U.S. dollar index which measures the greenback against a basket of six currencies was up 0.65 percent at 95.274, on pace for its second day of gains. Overall, the EUR/USD traded with a low of 1.1539 and a high of 1.1670 before closing the day around 1.1555 in the New York session.

 

Yen

The Japanese Yen pair rallied after a moderation in the U.S administration’s approach to Chinese investment. The dollar was up 0.15 percent against the yen at 110.21 yen and advanced 0.64 percent against the franc. The Japanese and Swiss units tend to benefit at the dollar’s expense in times of geopolitical and financial tensions. Overall, the USD/JPY traded with a low of 109.66 and a high of 110.47 before closing the day around 110.27 in the U.S session.

 

British Pound

The British Pound hit lows of $1.31 against the US dollar as investors digested recent dovish comments from MPC member-in-waiting Johnathan Haskel. Investors haven’t had much in the form of significant UK data releases to assess this week, but Sterling has seen some movement as markets reacted to a range of combative statements from the Bank of England (BoE). Overall, the GBP/USD traded with a low of 1.3104 and a high of 1.3231 before closing the day at 1.3114 in the New York session.

 

Canadian Dollar

The Canadian Dollar continues to have an uneventful week. Yesterday Canadian Dollar fell on the release front; the sole Canadian event was a speech from BoC Governor Stephen Poloz. In the U.S, the focus was on durable goods orders. Today, the U.S will publish Final GDP for the first quarter and unemployment claims. Overall, USD/CAD traded with a low of 1.3274 and a high of 1.3384 before closing the day at 1.3344 in the New York session.

 

Australian Dollar

The Australian Dollar continued to edge lower yesterday Despite the slight easing in trade policy tensions, the Australian and New Zealand Dollars, which are dependent on trade with China, remained under pressure. If you look at the broader trade policy backdrop it is still fluid and still uncertain. Overall, AUD/USD traded with a low of 0.7321 and a high of 0.7405 before closing the day at 0.7337 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 41 and lies below the neutral zone. In general, the pair has lost 0.57%.

 

 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 35 reading and lies below the neutral zone. On the whole, the pair has gained 0.08%.

 

 

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 37 reading and lies below the neutral region. In general, the pair has lost 0.48%.

 

 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 54 and lies above the neutral region. On the whole, the pair has gained 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 35 and lies below the neutral region. In general, the pair has lost 0.18%.

 

 Appendix

 

FOREX Closing Prices for June 27, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.1645 1.16708 1.15392 1.15559 -0.0090
USD/JPY 110.028 110.471 109.667 110.272 0.2560
GBP/USD 1.32205 1.32319 1.31047 1.31144 -0.0107
USD/CHF 0.99076 0.99746 0.98895 0.99734 0.0069
USD/CAD 1.32991 1.3384 1.32748 1.33445 0.0040
EUR/JPY 128.144 128.322 127.236 127.424 -0.7340
GBP/JPY 110.519 110.634 110.342 110.589 0.0860
CHF/JPY 110.998 111.118 110.494 110.593 -0.4250
AUD/JPY 81.312 81.608 80.722 80.947 -0.3900
EUR/GBP 0.88054 0.88261 0.87952 0.88132 0.0006
EUR/CHF 1.15391 1.15528 1.15074 1.15237 -0.0013
GBP/CHF 1.31037 1.31114 1.30581 1.3078 -0.0023

 

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1375 1.1457 1.1506 1.1589 1.1638 1.1720 1.1770
USD/JPY 109.00 109.33 109.80 110.14 110.61 110.94 111.41
GBP/USD 1.2942 1.3023 1.3069 1.3150 1.3196 1.3278 1.3323
USD/CHF 0.9832 0.9861 0.9917 0.9946 1.0002 1.0031 1.0087
USD/CAD 1.3176 1.3225 1.3285 1.3334 1.3394 1.3444 1.3503
EUR/JPY 125.91 126.57 127.00 127.66 128.09 128.75 129.17
GBP/JPY 110.12 110.23 110.41 110.52 110.70 110.81 110.99
CHF/JPY 109.73 110.11 110.35 110.74 110.98 111.36 111.60
AUD/JPY 79.69 80.21 80.58 81.09 81.46 81.98 82.35
EUR/GBP 0.8766 0.8781 0.8797 0.8812 0.8828 0.8842 0.8859
EUR/CHF 1.1458 1.1483 1.1503 1.1528 1.1549 1.1573 1.1594
GBP/CHF 1.3000 1.3029 1.3054 1.3083 1.3107 1.3136 1.3160

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

 

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