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ATFX Market Outlook, 2019 Aug 9
Personal opinions today:
Today, US July PPI and next week US CPI announcement. These are the inflation data the market is looking at. The results will show US price and inflation levels, as well as the Fed reasonable interest rate. Investors should watch the July PPI monthly performance today. A stronger U.S. PPI monthly rate could lead to a stronger dollar, extending its trend until next week U.S. CPl results. If the U.S. data is good, it will be bearish for gold and the yen, and bullish the crude oil price.
In the afternoon, data from the European region was also worth watching for short-term volatility. Keep an eye on European markets today, Germany trade accounts and current accounts. For British pound, the UK trade account for June, the monthly rate of UK industrial and manufacturing output in June and the preliminary annual rate of UK GDP in the second quarter. The British data can make fluctuations in the pound, which is the most noteworthy of the European currencies.
[Important financial data and events]
09:30 RBA monetary policy statement
09:30 China CPI in July
13:45 Swiss unemployment rate for July
14:00 Germany trade account and current account
14:45 French industrial output in June
16:00 IEA releases monthly oil market report
16:30 UK trade account for June
16:30 UK industrial and manufacturing output in June
1630 UK GDP for the second quarter
20:30 US PPI in July
Yesterday, ECB economic report was likely to be bearish on the euro. Europe economy has yet to see much of a recovery, and the euro will be tested today with the release of the trade balance and current accounts for Germany. Switzerland July unemployment rate was also in focus ahead of the German data. Advice to focus on the trend of the Euro and the Swiss franc may have a temporary divergence. Also, look at U.S. economic data. If the U.S. data is weak, European currencies could see some upside. But short-term significant resistance remained at 1.1250 and significant support at 1.1170.
The British prime minister mentions that the European Union will finally accept Britain new Brexit deal. But the European commission has said it will accept only the Brexit agreement agreed by the former British prime minister by the end of October. If the British prime minister insists on a new Brexit , the market estimates that after Brexit , the UK boundaries will be divided, which will affect the economy and negatively affect the pound. Technically, the pound is stuck at 1.22 against the dollar. If the U.S. economic data is stable and Britain has no way to deal with the risk of hard Brexit, the pound may not break through the 1.22 resistance. Britain's trade account for June, industrial and manufacturing output and the most important preliminary estimate of second-quarter GDP today. Preliminary estimates now suggest the pound is strengthening at 1.21, pending the data. Watch out for any weak data that could be seriously bearish for pound.
The Reserve bank of Australia and the Reserve bank of New Zealand ended their interest rate decisions recently. The two central Banks mentions that after the rate cut, the interest rate fell to a historic low level, indicating that they have no intention of cutting interest rates again. Australia economic outlook, assuming the growth rate could reach 2.5 percent, the reserve bank of Australia said today, as low interest rates help boost growth and bullish the Australian dollar. If U.S. inflation data are weak today and next week, the Fed may consider further rate cuts, which could further bullish the Australian and New Zealand dollars.
Japan July economic outlook report showed the GDP slowed, raising expectations that the bank of Japan may ease monetary policy further, possibly bearish the yen. Technically, pay attention to 106.50 and 106.70 resistance. Currently, if the Dow and Nikkei rebound, the USDJPY could test the resistance of 106.50 and 106.70. Otherwise, it would go down to the 105.55 support. Note that the USDJPY test 105.55 support two times , looking forward to double bottom or triple bottom is not broken, may rebound.
The U.S. President and federal reserve officials said they were considering cutting interest rates as expectations of higher demand for oil, bullish the U.S. crude oil prices. Crude oil prices rose, indirectly lifting the Canadian dollar. As expected yesterday, the U.S. dollar fell below 1.3245 Canadian dollars. Technically, the USDCAD is likely to end its run at 1.33, with a move target testing support of 1.3205 or 1.3175. Its depend on US PPl growth and hope to bullish the crude oil prices.
US crude oil futures
The U.S. President and federal reserve officials have said they are considering cutting interest rates, increasing demand for crude oil. If crude oil futures break through $53.30, they could technically test the $55 level. Pay close attention to the trade war between China and the United States, and judge the trend based on good and bad news. Technically, U.S. crude oil futures have been adjusted to test support for a low of $50.60 in early June, with a rally above $53.30 and up at $54 or $55. It is recommended today to watch whether US PPl, if good increasing, it can bullish the crude oil prices.
Gold rose above $1,490 as the U.S. President and federal reserve officials weighed interest rate cuts. Dow, Nikkei and global stock markets have rebounded, which is bearish for gold. Technically, gold is estimated to have hit $1,500. If the trade war between China and the United States improves, it could lift investor sentiment. A strong Dow and Nikkei could further depress gold prices. The market focus on the July PPI monthly performance. A stronger U.S. PPI monthly rate could lead to a rise in the dollar, which could be extended until U.S. CPl results are released next week, while gold prices could fell with adjustment.
U.S. Dow Jones industrial average futures US30
The U.S. President and federal reserve officials said they were considering cutting interest rates, helping to lift the stock. The U.S. government is considering easing some restrictions on imports of Chinese telecommunications equipment suppliers. The Chinese government said the planned September trade talks with the United States would help improve bilateral trade relations, triggering a global stock market rally that lifted the dow above 26,000. The Dow could be up to 26520 if the President doesn't spoil the talks and there are no negative comments. At the moment, 26520 resistance is noteworthy, if the failure of the upper test, the Dow more likely to fall. Before the weekend, suggest to wait for adjustment, temporarily do not consider chasing more.
12050 / 12300 resistance
10850 / 10600 support
As the trade war between China and US heats up, Dow and other major stocks fell, hedge fund inflows to other capital market, bearish US dollar and bullish bitcoin. However, the sentiment maybe change, bearish bitcoin and other crypto currencies. Recommend check out the trends of gold price and compares the bitcoin price.
Enjoy trading! The content is for reference only. Please do ensure that you understand the risk.
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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.
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