FOREX INVESTORS MAJOR CURRENCY PAIRS 7.18.17 This morning, the greenback is trading lower against most of the major currencies, ahead of the US NAHB housing market index, slated to release in a few hours.
The EUR is trading higher against the USD, after the latest ZEW survey data indicated that investor sentiment across the Eurozone deteriorated more-than-expected in July.
The GBP is trading lower against the USD, after Britain’s annual inflation slowed in June, easing for the first time since October 2016, thus reducing the odds of an interest rate hike by the Bank of England in the near future. Yesterday, the Brexit Minister, David Davis and European Union’s chief negotiator, Michel Barnier, began four days of talks to settle Brexit terms.
The AUD gained ground against the USD, after minutes of the Reserve Bank of Australia’s (RBA) July meeting revealed that officials maintained a bullish outlook on the Australian economy and acknowledged recent improvement in the nation’s labor market, public investment and retails sales. Further, it revealed that policymakers now expect a cash rate of 3.5% to keep inflation in check and growth at reasonable levels.
Yesterday, the greenback traded higher in the New York session, against the key currencies. Macroeconomic data indicated that the New York Empire State manufacturing index fell more-than-expected in July. Meanwhile, two more Republican senators refused to support plans to repeal and replace Obamacare with Republican health-care bill, further delaying the US President, Donald Trump’s plans to implement his tax and fiscal reforms.
This morning at 09:40 GMT, the EUR is trading at 1.1555 against the USD, 0.66% higher from the New York close. Data indicated that the ZEW economic sentiment index fell more-than-expected across the Eurozone in July. This morning, the pair traded at a high of 1.1560 and a low of 1.1472. The Euro traded 0.1% higher against the US Dollar in the New York session yesterday, with the pair closing the session at 1.1479. The pair is expected to its find support at 1.1487 and its first resistance at 1.1592.
EUR/USD’s rally resumed and surges to as high as 1.1537 so far. Intraday bias is back on the upside for 1.1615 key resistance next. Decisive break there will pave the way to 1.2 handle. On the downside, below 1.1434 minor support will turn bias neutral and bring retreat. But near term outlook will stay bullish as long as 1.1312 support holds.
In the bigger picture, the firm break of 1.1298 resistance further affirm medium term reversal. That is, an important bottom was formed at 1.0339 on bullish convergence condition in weekly MACD. Further rise would be seen to 55 month EMA (now at 1.1763). Sustained break there will pave the way to 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516 next. This will now remain the favored case as long as 1.1118 support holds.
At 09:40 GMT, the pair is trading at 1.3038, with the Pound trading 0.12% lower against US Dollar from the New York close, after data showed that UK’s consumer price index rose less-than-expected on an annual basis in June. The pair witnessed a high of 1.3126 and a low of 1.3016 during the session. Yesterday, the Pound traded 0.16% lower against the US Dollar in the New York session and ended at 1.3054, amid dissension between British government as it wades into second round of Brexit negotiations. Immediate downside, the first support level is seen at 1.2994, while on the upside, the first resistance level is situated at 1.3104.
GBP/USD remains on the upside for the moment. Current rise should target 61.8% projection of 1.2108 to 1.3047 from 1.2588 at 1.3168. Overall, choppy rebound from 1.1946 is seen as a corrective pattern, hence, we’d be cautious on strong resistance from 1.3168 to limit upside. But firm break of 1.3168 will bring further rise towards 1.3444 key resistance. On the downside, below 1.3046 minor support will turn intraday bias neutral first.
This morning, at 09:40 GMT, the US Dollar is trading at 112.25 against the Yen, 0.35% lower from the New York close. Going ahead, investors will look forward to Japan’s final machine tool orders data, slated to release tomorrow. During the session, the pair traded at a high of 112.66 and a low of 111.99. Yesterday, the US Dollar traded 0.16% higher against the Yen in the New York session and ended at 112.64. The pair is expected to its find support at 111.87 and its first resistance at 112.75.
USD/JPY’s fall from 114.49 continues today and reaches as low as 111.98 so far. Intraday bias remains on the downside for deeper decline. As noted before, he rejection from 114.36 resistance suggests that whole correction from 118.65 is possibly still in progress. Sustained break of 55 day EMA (now at 112.03) will pave the way to 108.12 and below. On the upside, above 112.86 minor resistance will turn intraday bias neutral first.
The US Dollar is trading at 0.9549 against the Swiss Franc at 09:40 GMT this morning, 0.79% lower from the New York close. Amid a lack of major economic releases in Switzerland today, investor sentiment would be determined by global macroeconomic events. The pair traded at a high of 0.9635 and a low of 0.9541 this morning. Yesterday, the USD traded 0.16% higher against the CHF in the New York session and ended at 0.9625. The pair is expected to its find support at 0.9515 and its first resistance at 0.9609.
Breach of 0.9595 minor support indicates that consolidation pattern fro 0.9551 has completed at 0.9699. Intraday bias is turned back to the downside for 0.9551 first. Break will extend the fall from 1.0342 to 0.9443 key support level next. At this point, we’d expect strong support from there to bring rebound. On the upside, above 0.9699 will extend the consolidation with another rise. But upside should be limited by 0.9770 resistance and bring fall resumption.
The pair is trading at 1.2607 at 09:40 GMT this morning, with the USD trading 0.71% lower against CAD from the New York close. The pair traded at a high of 1.2701 and a low of 1.2605 this morning. The US Dollar advanced against the Canadian Dollar in the New York session yesterday, closing 0.35% higher at 1.2697. The Canadian Dollar lost ground, after Canada’s existing home sales declined on a monthly basis in June. The pair is expected to its find support at 1.2574 and its first resistance at 1.2670.
USD/CAD lost some downside momentum with 4 hour MACD crossed above signal line. But with 1.2770 minor resistance intact, intraday bias remains on the downside for further fall. Current decline is expected to target a test on 1.2460 low. Meanwhile, considering bullish convergence condition in 4 hour MACD, break of 1.2770 will indicate short term bottoming In such case, there will be lengthier consolidation before staging another decline.
The pair is trading at 0.7939 at 09:40 GMT this morning, with the Australian Dollar trading 1.8% higher against US Dollar from the New York close, following the release of hawkish minutes of the RBA’s latest meeting. This morning, the pair traded at a high of 0.7941 and a low of 0.7786. The Australian Dollar traded 0.38% lower against the US Dollar in the New York session yesterday, with the pair closing the session at 0.7799. The pair is expected to its find support at 0.7836 and its first resistance at 0.7991.
AUD/USD’s rise resumed after brief consolidation and reaches as high as 0.7903 so far. The break of near term channel resistance indicates upside acceleration. Intraday bias stays on the upside for 61.8% projection of 0.6826 to 0.7833 from 0.7328 at 0.7950 next. Break there will target 100% projection at 0.8335. On the downside, below 0.7785 will turn intraday bias neutral and bring consolidations before staging another rally.
Gold is trading at $1235.80 per ounce at 09:40 GMT this morning, 0.19% higher from the New York close. This morning, the precious metal traded at a high of $1238.10 per ounce and a low of $1232.20 per ounce. Yesterday, gold traded marginally lower in the New York session and closed at $1233.50 per ounce, amid strength in the greenback. Immediate downside, the first support level is seen at $1230.30 per ounce, while on the upside, the first resistance level is at $1239.70 per ounce.
A weaker U.S. Dollar and lower U.S. Treasury yields are helping to support gold pricesearly Tuesday. Although the market is trading higher, buyers look a little tentative as gold inches its way through a major retracement zone.
Keep in mind that although the U.S. Dollar is falling and that theoretically, gold as a dollar-denominated asset is expected to rise because a cheaper dollar tends to increase foreign demand, gold is also sensitive to rising interest rates.
With the odds of a Fed rate hike later this year quickly diminishing, and the chances of a rate hike by the European Central Bank, on the heels of a Bank of Canada rate hike last week, slowly increasing, this gold rally may actually face some resistance.
The precious metal is trading at $16.11 per ounce at 09:40 GMT this morning, 0.06% higher from the New York close. During the session, silver traded at a high of $16.20 per ounce and a low of $16.06 per ounce. In the New York session yesterday, silver fell 0.09% and closed at $16.10 per ounce. Immediate downside, the first support level is seen at $15.99 per ounce, while on the upside, the first resistance level is at $16.21 per ounce.
Banks expect gold to match its 2016 average this year, but cut their silver price forecasts after the metal slid 9 percent in the second quarter.
A poll of 39 analysts and traders conducted by Reuters this month returned an average silver price forecast of $17.32 an ounce for 2017, down from an average view of $17.98 in a similar poll conducted three months ago.
That is just over 1 percent above last year’s average of $17.09 an ounce.
The commodity is trading at $46.19 per barrel at 09:40 GMT this morning, 0.54% higher from the New York close. Crude oil witnessed a high of $46.26 per barrel and a low of $45.81 per barrel during the session. In the New York session yesterday, crude oil fell 0.73% to close at $45.94 per barrel, after the EIA forecasted that US shale-oil production is set to rise in August. Immediate downside, the first support level is seen at $45.76 per barrel, while on the upside, the first resistance level is at $46.68 per barrel.
Oil prices extended gains on Tuesday following a report that Saudi Arabia is considering further limiting the amount of oil it ships beyond its borders.
The Saudis are considering cutting crude oil exports by 1 million barrels a day, according to Bloomberg News.
Brent crude futures, the international benchmark for oil prices, were up 85 cents, or 1.8 percent, at $49.27 per barrel by 8:16 a.m. ET (1216 GMT), up 13 cents, or 0.3 percent, from their last close.
U.S. West Texas Intermediate (WTI) crude futures were rose 82 cents, or 1.8 percent, to $46.84 per barrel.
MAJOR CURRENCY PAIRS 7.18.17
On an annual basis, in the UK, the consumer price index recorded a rise of 2.60% in June, compared to an advance of 2.90% in the prior month. Markets were anticipating the consumer price index to climb 2.90%.
On an annual basis in the UK, the house price index registered a rise of 4.70% in May, compared to a revised advance of 5.30% in the prior month. Market anticipation was for the house price index to climb 3.00%.
In July, the economic sentiment index in the Eurozone fell to a level of 35.60. In the prior month, the economic sentiment index had recorded a reading of 37.70.
In July, the economic sentiment index in Germany dropped to 17.50, compared to a level of 18.60 in the prior month. Markets were anticipating the economic sentiment index to fall to 18.00.
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