ATFX Market Update - 2020.02.11

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ATFX Market Outlook, 2020 Feb 11

Personal opinions today:

Investment sentiment continued to be positive yesterday, supported by U.S. non-farm payrolls data for January and a good reading on wages. Moreover, the improvement of trade relations between China and the United States will boost the investment confidence of American enterprises and increase the expectation of corporate earnings growth. Now, investors are looking for gains in January consumer prices, retail sales, and the Michigan consumer sentiment index, which will be released this week, and could see gains in Dow futures and the dollar index. The lack of good news in Europe and commodity currencies is expected to be bearish for the Euro and commodity currencies. If Dow futures and the dollar continue to strengthen, it is believed that this will limit the upside space for gold and silver prices, more likely to adjust recent gains, prices fell. China’s industrial and manufacturing sectors returned to work after the Chinese New Year holiday, boosting demand for crude oil. Tomorrow morning, the market will wait to see the outlook for the energy report and the results of oil inventories, with the monthly short-term energy outlook from the international energy agency (EIA) and last week's API crude oil inventories.

In European trading today, U.K released its first estimate of its December merchandise trade account and Q4 GDP. Investors now waiting for the annual report from ECB and testimony from federal reserve and Bank of England governor appeared at the hearing tonight. These speeches would directly affect the European currencies, global stock markets, and gold prices. The market could also volatility tonight, please pay attention!

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

17:30 U.K. Trade account for December **
17:30 U.K. GDP for Q4 ***
17:30 UK industrial and manufacturing output in December *
19:00 U.S. January NFIB small business confidence index *
22:00 ECB President delivers annual report ***
23:00 Fed chairman Powell testifies ***
23:30 Bank of England governor attends the hearing ***
The next day 01:00 EIA releases short-term energy outlook **
The next day, 05:30 U.S. API crude oil stocks change ***

EURUSD
1.0935/1.0945 resistance
1.0890/1.0880 support
U.S. jobs and economic growth were strong in January, and the federal reserve has a good outlook for the U.S. economy. The ECB's outlook for the future is uncertain given the steady performance of European economic data. As here analysis estimates yesterday, the Euro has tested 1.0930 support against the dollar. Watch tonight for ECB President annual report on the bank's monetary policy and outlook. Technically, the EURUSD note is limited to 1.0985 resistance, short-term resistance 1.0940. The Euro could continue its downward trend against the dollar, with an opportunity to test last year's low of 1.0880. In addition, pay attention to the pound fluctuations, indirect impact on the Euro.

Pound to dollar
1.2935/1.2955 resistance
1.2885/1.2855 support
As markets wait for the release of the UK's Q4 GDP results today, they are advised to take note. Investors now expect GDP growth to fall. Resistance to the dollar is believed to be limited to 1.2955 ahead of the data. In addition, the governor of the Bank of England, Carney, will appear at a hearing tonight on how the presentation of monetary policy could affect the value of the pound. Looking ahead, the pound is trading at $1.2855.

Australian dollar
0.6715/0.6725 resistance
0.6685/0.6675 support
Strong U.S. economic and job data and a rise in the U.S. dollar index had limited the Australian dollar's gains. Looking back at recent Australian economic data showing growth, the Australian dollar is likely to rise as investors look for a pick-up in first-quarter growth. Stay focused on the Aussie adjustment to the current 0.66 level, or consider buying AUDUSD as low as possible. If the future time, looking at the United States and China economic growth, bullish the Australian dollar. On the other hand, investors assuming that the Australian and New Zealand dollars moved higher tomorrow morning after the reserve bank of New Zealand raised interest rates and was expected to confirm it was on hold.

Dollar to yen
109.95/110.05 resistance
109.55/109.45 support
Risk aversion in the United States cooled after January's economic and job data showed growth. U.S. Dow futures and global stock markets are expected to have limited losses. The dollar/yen is expected to support resistance at 109, above 110. If Dow futures continue their upward trend, the dollar could test 110.20 resistance against the yen. Believe that, this week under the United States economic data outlook, driving the global stock market, bullish USDJPY, test the 110.20 resistance.

USDCAD
1.3315/1.3325 resistance
1.3270/1.3260 support
Recent U.S. economic and job data beat expectations, easing fears of a slowdown in oil demand, and could help ease crude prices and boost the Canadian dollar. Tomorrow's EIA report and last week's change in crude oil inventories are important short-term factors for oil prices. If crude oil price breaks through resistance at $52.38, expect to see gains in the Canadian dollar. Technically, USDCAD keeps an eye on the 1.3325 resistance, looking below the 1.3260 support level.

US crude oil futures
52.35/52.60 resistance
49.55/49.35 support
U.S. strong job and economic data in Jan, it could lead to gains in crude oil prices. If OPEC’s cuts are confirmed, and if they are coordinated with other producers, they could stabilize prices and lead to a rebound. The EIA report and the change in crude oil inventories last week are worth watching. Technically, keep an eye on the $49.55 and $49.35 support levels, looking in the $51 or above.

Gold
1575/1577 resistance
1560/1558 support
Recent U.S. economic data has been strong, and Dow futures rise and gold cools amid risk aversion, it could be bearish for gold. Gold prices rose on concerns that Central Banks around the world continue to keep interest rates low and increase the money supply. On the other hand, non-farm data in the United States show average wages rising. Expectations for inflation and consumption data out of the U.S. this week provide an opportunity to bearish sentiment for gold prices.

U.S. Dow Jones industrial average futures US30
29415/29600 resistance
28855/28695 support
The U.S. payrolls and average wages rising, which could lift Dow futures. Short-term Dow futures move to adjust for gains, with a target of 28855 or 28695 support. If combined with U.S. data or good news on signs of economic recovery, Dow futures could test 29,600 resistance.

BTCUSD:
10000 / 10250 resistance
9550 / 9300 support U.S. job data rose much more than expected, it could foresee the Dow futures rebounded, back to record high 29400 levels. Keep watching the Dow future and global stock market indexes. If Dow fell, the bitcoin price could up. Otherwise, the bitcoin could fall.

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

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

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