ATFX Market Update - 2019.10.17

Personal opinions today:

The Fed Beige book did not indicate a U.S. recession, the economy is still expanding at a moderate pace, suggesting the Fed may need to watch the economy for some time before cutting interest rates. Dow futures fell and gold rose. Meanwhile in Britain, Brexit negotiations are expected to make progress, news said the President of the Brexit negotiations, there were opportunities for a New Deal to be reached. The European parliament will meet in two days to formally discuss and implement the new Brexit agreement. If accepted, the next step would be a formal vote in parliament. If the whole process is rejected by any party, Britain will leave the EU without agreement, which will bring negative effects. The success of Brexit will affect the price of pound, the Euro, commodities and even global stock markets. Keep an eye on it and be aware that the price may fluctuate a lot in these two days.

In European trading yesterday, the UK released the September CPI and retail price index, and the final CPI for the Eurozone in September. During that period today, Switzerland reported September trade accounts and the UK reported September retail sales. If the data beat expectations, European currencies could find resistance. U.S. weekly jobless claims, the Philadelphia fed manufacturing index and U.S. industrial output in September will be highlighted during the session. A weaker than expected U.S. data could bearish Dow futures and crude oil prices, while gold could lead the rally, leading silver to follow.

[Important financial data and events]
Note: * is the degree of importance

8:30 Australia's unemployment rate in September **
12:30 RBA 2019 annual report **
14:00 Swiss September trade account *
16:30 UK September retail sales **
20:30 US housing starts in September *
20:30 U.S. jobless claims last week ***
20:30 Philadelphia Fed manufacturing index October **
21:15 U.S. industrial output in September **
The next day at 02:00 Fed governor spoke **

Today's suggestion:

Euro/dollar
1.1095/1.1110 resistance
1.1055/1.01045 support
The Euro continued to test 1.11 on the Brexit deal seems successful. U.K. Retail sales figures released and a meeting of the European parliament today are expected to discuss whether the Brexit deal, if approved, and submitted to the British parliament for a final vote. In recent days, though, the Euro is expected to find new resistance because of the news. Brexit negotiations news, will continue to affect the pound move, indirectly affect the Euro.

Sterling versus dollar
1.2870/1.2880 resistance
1.2755/1.2745 support
The British prime minister presented the new agreement to the European Union. The EU would accept the new agreement and submit it to the European commission for discussion within two days. After that, the British parliament finally voted on whether the new Brexit agreement could be supported by British MPS, so as to successfully leave the EU by the end of October. If ultimately rejected, it could lead to a deep negative for pound. Keep watching the pound move.

Australian dollar to US dollar
0.6800/0.6810 resistance
0.6750/0.6740 support
The market digested the successful US and China trade negotiations, the Australian dollar trend overall positive. Australia's unemployment rate did better in September and the Australian dollar rose. Following the release of the RBA's 2019 annual report, it would believe it will affect the volatility of the Australian and New Zealand dollars. If the report shows the economy is doing well and there is no rush to cut interest rates further, it could be positive for the Australian dollar.

Dollar/yen
108.85/108.95 resistance
108.45/108.35 support
Investment sentiment was boosted by progress in US-China trade talks and the prospect of support for Brexit deal from the European Union, with Dow and Nikkei futures rising, pushing the dollar up 109 key resistance against the yen. It's worth noting that the U.S. reported a falling data in retail sales. In addition, the Fed Beige book, which said the economy was moderate and gave no indication that it expected to cut interest rates. The news made the Dow and Nikkei futures likely to fall respectively, the dollar will follow the trend against the yen, failed to break resistance.

U.S. dollar to Canadian dollar
1.3230/1.3240 resistance
1.3190/1.3180 support
Crude oil prices fell, indirectly affected short Canadian dollar. With U.S. inflation falling, U.S. retail sales weaker than expected, and a weaker dollar, the Canadian dollar could be worth more. U.S. dollar/Canadian dollar trading recommendations focus on crude oil prices. If crude oil prices fall, the chances of the U.S. dollar rising against the Canadian dollar remain high.

United States crude oil futures
54.05/54.30 resistance
52.35/52.05 support
U.S. economic data for September continued to be weak, with the already announced decline economy data. Then, release of U.S. retail sales forecast as weak as crude oil demand, bearish for oil prices. The market is watching U.S. economic data after the Beige book and API crude oil inventory data, bearish oil price, it may test below $52. But if there is new and good news on the US and China trade deal, it could be bullish for crude oil prices. Technical $52 level or below, it may be supported by investors to build long positions, worthy of attention.

Gold
1498/1500 resistance
1484/1482 support
China and the United States have made progress in trade negotiations, and the new Brexit plan may be accepted by the European Union and the British parliament. The news cooled demand for gold and the prices fell. But U.S. retail sales fell and the Fed did not respond to the rate cut. Money returned to the gold market again for a safe parking, gold prices rose. A technical decline in Dow futures could cause gold to rise. Silver tends to track gold, so keep an eye on it. It's worth watching these two days as the European parliament discusses a new plan for Britain to leave the EU. If it's rejected, it's gold price upward.

U.S. Dow Jones industrial average futures US30
27040/27110 resistance
26800/26720 support
Dow futures adjusted after US Retail Sales data and the Fed beige book. The contraction in U.S. retail sales in September. Without any further news to lift the spirits, Dow futures downside risk increased.

BTCUSD:
8600/ 8850 resistance
7885 / 7655 support
As US economy slowdown, FOMC would consider cut Fed fund rate. It is supposed good for crypto currencies, bullish Bitcoin and other crypto currencies. Risk off because the Brexit deal maybe approach successful the the crypto market demand decreased. Technically, the bitcoin price support at US7885 is very important. Assuming the bitcoin price as followed the gold price.

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

Information provided by AT Global Market, 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.

Legal: AT Global Markets Limited (ATGM, registration number 24226 IBC 2017). ATGM is an International Business Company in Saint Vincent and the Grenadines.

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