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ATFX Market Update - 2019.05.09


Personal opinions today
The china-us trade talks were held in Washington today, with the market watching the atmosphere and progress of the negotiations. At present, the outcome of any economic data is not important, the most important to see the results of the negotiations. If negotiations are not completed or progress is achieved in the last two days, the U.S. government is likely to impose an additional tariff of 25 per cent on Chinese imports tomorrow, undermining the global economic climate and the performance of the stock market. In any case, at this point in the lead-up to the talks, the market felt the talks had failed and the investment climate was cautious. Some equity markets saw a flight to safety, with gold and the yen rising, respectively. Crude oil prices continued to settle lower, hovering around $61. If the last bilateral relationship is improved and you temporarily raise the extra tariffs, you can change the entire market atmosphere.

[Important financial data and events to watch]
20:30 U.S. jobless claims for the week ended May 4‬
20:30 U.S. trade balance for March and PPI for April‬
20:30 Fed chairman Powell delivers the opening speech ‬
22:00 U.S. wholesale sales monthly rate for March‬
01:15 the next day, Fed chairman Evans speech ‬

Today's suggestion:

1.1200/1.1215 resistance
1.1180/1.1165 support
European central bank President Mario Draghi speech yesterday, he said the inflation target would not be changed to avoid the risk of economic recovery. The implication of the comments is that the ECB will continue to increase its loose monetary policy and the economic forecast outlook still falls short of expectations. The euro fell on the news. The Eurozone economy outlook against the U.S. economy performed, the U.S. is better than Eurozone economic data today. Expected U.S. dollar is stronger than EUR. Technically, the EURUSD daily chart reference resistance of 1.1225. Reference support at 1.1165. During this period, investors need to keep an eye on China and U.S. trade relations. If China and U.S. relations break down and money flows to the US dollar, it may affect the decline of Euro and Swiss franc.

1.3040/1.3075 resistance
1.2950/1.2920 support
The British parliament has still failed to solve the Brexit policy so far, negative effects, bearish GBP. The GBPUSD fell from 1.31 to 1.30‬, which was as low as 1.2990. In addition, due to uncertainties in China and U.S. trade negotiations, capital flows to the USD failed to change the expected trend, and the trend of the GBPUSD continued to decline. At present, we must pay attention to China and U.S. trade relations and judge the situation. The situation worsens, GBPUSD can try below 1.2950. Now, resistance refers to 1.3040 and 1.3075.

0.6995/0.7015 resistance
0.6965/0.6945 support
While the RBA kept interested rates unchanged, in line with market expectations. However, trade tensions between China and the United States confidence loss in Australia's economic outlook, bearish AUD. If the trade talks fail, the trend of the AUDUSD will fall. Now the AUDUSD reference support at 0.6965, while the NZDUSD support at 0.6545.

110.45/110.70 resistance
109.80/109.55 support
Stocks continued to fall ahead of the trade talks, with the Nikkei down more than 1,000 points in a week and the dollar losing support against the yen at 110.05. Today the China and US trade talks coming up again. If they ease tensions, stocks could rebound, with USDJPY can try the reference resistance at 110.45 and 110.70. Instead, the trade talks failed, stocks tumbled, and the dollar fell against the yen. At present, the change in market news dominates the trend of USDJPY. It is suggested to refer to the fluctuations of Dow Jones and Nikkei index, and USDJPY follows the synchronous trend. If the stock market volatility is greater, the USDJPY volatility is greater as well.

1.3495/1.3535 resistance
1.3435/1.3405 support
Crude oil inventories rose, trade tensions between China and the U.S. rose, and all the news was negative for the Canadian dollar. Technical, the USDCAD trade between 1.3475. If China and US trade talks fail today, the expected drop in crude oil demand will also hurt the Canadian economy, bearish CAD. On the contrary, if the trade talks success, crude oil prices rebound, is expected to be bullish CAD, test 1.3400.

U.S. crude futures USOIL
60.85/60.05 support
62.65/63.25 resistance
U.S. President's comments have strained relations between China and the United States, and crude oil prices are lower as inventories rise. But the United States imposed a crude oil embargo on Iran, resulting in tight supplies and stable prices. Technically, the key support is $60.85, and a breakout it could test below $60.05 to $58. Any good news from the trade talks could boost crude oil prices. For the next two days, please keep an eye on the trade talks and the results of the negotiations as a way of judging the situation.

1287/1292 resistance
1282/1277 support
China and US tensions, global stock market volatility, money flowing into gold, pushing up the price of the gold. If relations cannot solve this week, gold prices could up further. Technical resistance target 1287 And further would be $1,292 or $1,295. If tensions ease, gold could test support at 1,277. Please pay close attention to the content and situation of the China and US trade talks and the results of negotiations tomorrow.

U.S. Dow Jones industrial average futures US
3026360/26535 resistance
25785/25215 support
China is scheduled to attend the trade talks. Before leaving, the Chinese delegation said the goal of the meeting was to reach an agreement. If the talks fail and the U.S. President earlier threatened to impose additional tariffs on Chinese imports, as expected, the investment climate could suffer, and the Dow could fall sharply. Today and tomorrow, we must keep on eyes on the negotiations between China and the United States. Technically, the current resistance levels are 26360 and 26535, while the support levels are 25785 and 25215. Now we must pay attention to the trend of the Dow Jones industrial average, the trend of the Dow Jones industrial average is mainly driven by the trade talk. It is hoped that during the talks, the US President will resolve the deadlock and boost the stock market before cancelling the implementation of the tariff increase.

6100 / 6265 resistance
5850 / 5700 support
The FOMC keeps the interest rates unchanged. China and U.S. tension, global stock markets fell; Dow still has a chance to decline. The bitcoin price could stay well and rise. Technically the bitcoin price is expected to test $6100 and $6265 but keeps watching the China and U.S. trade talks results. Positive outlook, bearish the price of Bitcoin.

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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