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ATFX Market Update - 2020.02.17


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ATFX Market Outlook, 2020 Feb 17

Personal opinions today:

Japan Q4 GDP fell to -1.6% and an annual rate was -6.3%, the lowest since 2014. In addition, Japanese private consumption and spending and business spending fell sharply in Q4, affecting market investment sentiment. The Nikkei index fell more than 200 points after the Japanese data and the dollar fell against the yen. At noon, Japan reported December industrial production. With the data now expected to be weak, the Nikkei index and the dollar/yen could still have a chance to bearish. If Asian stock markets fell, expected to lead to bullish gold and silver prices, but crude oil prices fell.

U.S. markets are closed for the holidays, and no U.S. data are available. Investor’s focus fell on the meeting of the European organisation and a speech by the ECB’s chief economist. The impact on the Euro and other European currencies is currently bearish and is indirectly bullish on gold and silver prices. After the ECB's chief economist comments, it could cover the losses in Euro and limit gains in gold and silver prices.

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

U.S. holiday, Dow Jones closed for the day.
07:30 Japan Q4 GDP ***
08:30 RBA issued a monetary policy statement **
12:30 Japan December industrial production **
18:00 Eurozone construction output in December **
18:00 Eurogroup meeting ***
18:00 ECB chief economist speaks ***

1.0860/1.0870 resistance
1.0810/1.0800 support
Weak economic data in the eurozone, investors support dollar assets, bearish euro. Comments by the ECB’s chief economist today are likely to continue to give the outlook for the eurozone economy. If his remarks are a positive outlook for the eurozone economy. Euro/dollar is expected to test 1.0870. But technically, the Euro is limited to 1.0880 resistance against the dollar, and further downside is still possible. The Euro is likely to continue its correction against the dollar, with a 250% correction, 1.0810 currently a significant support level.

Pound to dollar
1.3080/1.3090 resistance
1.2960/1.2950 support
After the Fed chairman said last week that there was no plan to raise interest rates in the first half of the year or for the rest of the year, the British pound rebounded and rising with the 10-day moving average. Technically, the pound can test 1.3080 or 1.3090 resistance in a short rally. UK unemployment and employment change data for December will be released tomorrow, and UK consumer and retail price indices for January will be released the day after tomorrow. That was followed on Thursday by the release of the UK retail sales data for January and the PMI for the manufacturing sector for February. The market is watching the data. If the data beat market expectations, the pound upward. Technically, the British pound could test a significant resistance to $1.3120. If falls, 1.2950 are important to support for pounds.

Australian dollar
0.6745/0.6755 resistance
0.6710/0.6700 support
The RBA policy statement released this morning, the Australian dollar fell a bit. Technically, the key resistance of AUDUSD as 0.6755. If this resistance is broken, the Australian dollar could test 0.6800. For Short-term reminders, the significant support as 0.6700.

Dollar to yen
110.10/110.20 resistance
109.65/109.55 support
Japan Q4 GDP fell to -1.6% and an annual rate was -6.3%, the lowest since 2014. The Nikkei index fell and the dollar rose against the yen. Technical analysis, dollar-yen trading sideways, between 110.20 resistance and 109.55 support. If the global stock market falls, the USDJPY would test 109.55 support, or 1.0925. In addition, it is worth noting that Japan's fiscal year is approaching, corporate capital funds back, the dollar/yen is more likely to test the 108 or 107 levels.

1.3280/1.3290 resistance
1.3220/1.3210 support
U.S. retail sales rose for the fourth month continued and the Michigan consumer confidence rose above the 100 level in February, pushing oil prices and the Canadian dollar higher. Technically, the USDCAD trend to see if it can break through the 1.3210 key support level. With no data, because the U.S. and Canadian holidays today, it is believed that USDCAD will trade in ranging between 1.3220 and 1.3280 in the short term.

US crude oil futures
52.35/52.60 resistance
51.55/51.35 support
U.S. retail sales rose in January and Michigan consumer confidence rose above the 100 level in February, bullish oil prices. Separately, OPEC has offered to cut output and is waiting for support from other members. Oil prices are expected to upward for now. As this analysis estimated last week, oil at $50 or $49 could be bought by investors if prices adjust. If crude oil breaks through 52.60 resistance, it could go up to $54.

1584/1586 resistance
1576/1574 support
The U.S. federal reserve, the ECB and most Asian central Banks kept monetary policy lower, demand for gold and silver prices higher. The ECB's chief economist comments today, could talk about the interest rate and economic outlook. This has the opportunity to bearish gold and silver prices. Technically, keep an eye on $1, 586 resistance and $1, 592 for significant resistance. If gold price adjusts for gains, watch the $1576 and $1574 support levels.

U.S. Dow Jones industrial average futures US30
29550/29635 resistance
29080/28935 support
U.S. retail sales data for January and Michigan consumer confidence rose in February, and Dow futures opened higher this morning. With the U.S. holiday today, investors have a chance to limit gains before waiting for the FOMC minutes this week. Technically, Dow futures mainly resistance at 29,550 and 29,635 levels.

9985 / 10225 resistance
9550 / 9415
support We mentioned last week that the Dow futures rebounded, testing 29550 resistance. Keep watching the Dow future and global stock market indexes after the U.S. retail sales data. If Dow fell after the data, the bitcoin price could keep up further. Otherwise, the bitcoin could fall. If Dow falls before FOMC minutes, the bitcoin would rebound from lower.

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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