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ATFX Market Update - 2019.05.06


Personal opinions today

After a sharp rise in private ADP jobs in April, the US nonfarm payrolls rose more than expected to 263,000 in April. Private nonfarm payrolls totaled 230,000 in April, and the unemployment rate fell to 3.6 percent, beating market expectations. Unfortunately, hourly wages under expectations, fell below market estimates. The dollar index's rally ended after U.S. service sector purchasing managers fell short of market expectations in April, while the EURO , GBP and gold price rallied.

Separately, the US President expressed dissatisfaction with the progress of Sino-U.S. trade talks and considered raising additional tariffs on some us $200 billion worth of Chinese imports to US goods on Friday. U.S. Dow futures were among the first to fall, and Asian stocks followed, with regional currencies such as the China RMB, AUD and NZD falling. Crude oil futures tumbled to $60. The dollar broke above 110.50 yen. If there is no any good news this week to ease tensions, which have dampened investment sentiment, it will affect global stock markets, crude oil prices and Asia currencies except JPY. Conventional safe-haven funds would push up the price of gold and the JPY.

[Important financial data and events to watch]
(UK, Japan and South Korea are closed for the day)
15:50 final French services PMI in April
15:55 German final service PMI in April
16:00 Eurozone services PMI in April
16:30 Eurozone investors confidence sentiment index in May
17:00 Eurozone retail sales rate in March
18:00 US Chicago fed releases highlights of Evans speech
The next day, 01:45, governor of the bank of Canada speech

Today's suggestion:

1.1210/1.1225 resistance
1.1155/1.1140 support
U.S. nonfarm payrolls rose more than expected in April and the unemployment rate fell to 3.6 percent. But the dollar ended its gains after average U.S. wages and services purchasing managers fell short of expectations in April. The euro was supported, hitting a high of 1.12. The US President's latest comments have damaged Sino-U.S. relations and spilt over into European currencies. And expectations that the eurozone retail sales rate would fall to minus 0.1 percent limited the euro's gains in the short term. Technical by daily chart, the EURUSD resistance are 1.1210 and 1.1225. Support are 1.1155 and 1.1140.

1.3155/1.3175 resistance
1.3095/1.3075 support
U.S. jobs data showed strong growth, but the average wage and services purchasing manager index fell short of market expectations, ending the dollar's rally. In addition, the President of the United States has said the Fed rate cuts, boosting the GBP. But the latest news is that the President of the United States will plan to impose tariffs on Chinese imports, threatening that money may flow to the dollar and limiting the rise of the GBP. In the short term, the key resistance are 1.3155 and 1.3175. The first target support are 1.3095 and 1.3075.

0.6985/0.7005 resistance
0.6945/0.6930 support
Australia, which has tight trade relations with China, fell on expectations of a slowdown due to trade tensions between U.S. And China. The opening today, AUDUSD broke through 0.6985 support, close to 0.6960 support. The reserve bank of Australia (RBA) believes there are downside risks to AUD ahead of its policy meeting tomorrow. Now AUDUSD can refer to 0.6985 and 0.7005 resistance. The first support are 0.6945 and 0.6930. In addition, the Reserve Bank of New Zealand interest rates decision on Wednesday and the market watched the monetary policy and economic outlook, with short-term reference to the NZDUSD support at 0.6585.

110.85/111.05 resistance
109.85/109.60 support
The Dow Jones industrial average fell on the impact of the US President's remarks, while the Nikkei followed fell, with the USDJPY once testing support for 110.25. If tensions between the U.S. and China rise and stocks continue to fall, USDJPY will keep fall. Short-term technical support are 109.85 and 109.60, and upper reference resistance are 110.85 and 111.05. At present, the change of market news dominates the trend of the USDJPY. It is suggested to refer to the fluctuation of the U.S. Dow and follow the synchronous development.

1.3530/1.3575 resistance
1.3405/1.3375 support
Tensions between China and the United States and the possible failure of trade talks between the two countries have hurt crude oil prices and the Canadian dollar. Technical trend, the USDCAD once again test resistance 1.3475. If crude oil prices fall, the USDCAD could test near the $1.36 level. If crude oil prices rebound, bullish for the Canadian dollar. The USDCAD could test 1.33.

U.S. crude futures USOIL
59.85/59.05 support
62.65/63.55 resistance
U.S. President's comments have strained relations between the United States and China, and this week trade talks between the two countries are likely to fail. Technically, crude oil prices fell below 62.25 support and extended an adjustment wave of 23.6 percent to see $60.80 again, with the next test likely to be below $59 to $58. Believe that if the Sino-U.S. relationship improved, can be boost the price of crude oil.

1288/1292 resistance
1280/1276 support
Market tensions are rising again, with tensions over Sino-U.S. relations and trade becoming a global stock market trouble, and gold set to become a safe-haven asset with a chance to push up the price of gold. If relations cool down this week, gold prices could fall. The technical resistance targets is $1,288 and $1,292. If tensions ease, gold price could test support $1,276.

U.S. Dow Jones industrial average futures US30
26140/26305 resistance
25960/25785 support
China and U.S. tensions and trouble on global stock markets, Dow fell sharply. If trade talks between China and the United States are expected to continue and import tariffs on Chinese imports are lifted, that could boost the investment climate and allow the Dow to rebound. Technically, refer to resistance 26140 and 26305 and support 25960 and 25785.

5850 / 6000 resistance
5400 / 5270 support
The FOMC keeps the interest rates unchanged. China and U.S. tension and troubled on global stock markets; Dow fell sharply. The bitcoin price could up. Now the market waiting for the US non-farm payroll results. If good number, positive bitcoin. Technically the bitcoin price is expected testing US5500, test lower support 5200 or 5070 support.

Enjoy trading! The content is for reference only. Please do ensure that you understand the risk.

Information provided by ATFX, Chief Analyst of Asia Pacific: Martin Lam

Registered Australian Accountant/ Certified Professional Manager / Certified Financial
Advisor Experienced Investor / Media Market Commentator Martin Lam has Over 17 years’ experience in global investment market. Familiar with the worldwide stock indices, precious metals such Gold and Silver, Crude oil and Forex. He operated Martin Currency Trading Company and had partnership with a number of well-known international financial corporations and institutions. Before he join ATFX, he was TeleTrade Greater China development and Sales Director. Mr. Lam attends Hong Kong Now TV and China CCTV finance channel once a week. He also had regularly invited by different media, such as DBC Digital Financial Channel, Hong Kong Economic Times, The Standard, Ming Pao to share his experience to trade in Forex, Precious metals, Crude oil and worldwide stock indices.
Contact: cs.gm@atfx.com or wechat: ATFX_China

Legal: ATFX is a trading name of AT Global Markets Limited (ATGM, registration number 24226 IBC 2017). ATGM is an International Business Company in Saint Vincent and the Grenadines. Registered address is : the Financial Services Centre, Stoney Ground, Kingstown, St.Vincent & the Grenadines.

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