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ATFX Market Outlook, 2019 Aug 16
Personal opinions today:
Eurozone economic growth is weak, and the European central bank said it would announce increasing the monetary stimulus measures at its September meeting, including interest rate cuts and issues bond purchases again, to raise capital flows in the market, which will be bearish for the Euro. On the other side of the dollar, the yield on the 10-year Treasury bond, which reflects long-term U.S. funding and inflation expectations, fell, although Treasury yields improved upside down. The spread between 2-year and 10-year Treasury yields is closer less than 10 basis points, and interest rate futures are pricing in a 77% chance of a 25 basis point cut in the Fed meeting in September. It believed that the US-China trade talks in September could serve as a rationale for whether the global central banks will cut interest rates.
Market expectations of a drop in the Eurozone trade account in June which have become an excuse for the Euro to fall, with the euro expected to rise if the actual result is in line or better than expected. Add in the total number of U.S. building permits, new home starts, and the Michigan consumer confidence index for August, and the dollar is expected to fall ahead of the U.S. data. The dollar fell on estimates of weakness in the US economy, which could boost the price of gold and the yen. Oil prices are likely to fall as OPEC releases its monthly market report during trading hours between Europe and the US. Statements reflect supply and output, which can affect prices. The dollar is now expected to fall against major currencies, while European currencies are expected to rise.
[Important financial data and events]
17:00 Eurozone trade accounts for June
20:30 U.S. building permits for July
20:30 U.S. new housing starts in July
22:00 U.S. Michigan consumer confidence index for August
Pending OPEC monthly oil market report
The European central bank is considering to cut interest rates and issues quantitative easing monetary policy, which is bearish for the euro but good for the economy. European market focus is on expectations of weak U.S. economic data that could be bullish the Euro. It is worth noting the performance of the U.S. data. Estimates in anticipation of weak U.S. economic data, at least stability in the Euro.
U.S. economic data was expected to be weak, with the dollar falling and pound decline steady. Technically, the Brexit issue limited the rise of the pound, with 1.2140 as one of the critical resistance levels. If the pound breaks through 1.2015 support, it may go down to 1.1970, or it may go down to adjust the wave 150%, 1.1945 support. In the short term, market doubts about the U.S. recession, the federal reserve cut interest rates in September, offset the negative news of Brexit, the expected decline. The current technical support level can refer to as the resistance between 1.2035 and 1.2015. Watch the U.S. economic data today.
US-China trade friction, the failure to improve overall, the Chinese and US economies, and the prospect of global economic growth and recession, have caused us Treasury yields to flip. The dollar falls on weak U.S. data today. Or industrial metals prices rebound, the Australian dollar is expected to rise. In the short term, expectations are that weak U.S. data could boost the Australian and New Zealand dollars. Technically, the Australian dollar maintains a resistance of 0.6795 against the U.S. dollar, which could test the 0.6815 resistance range. Investors in the New Zealand dollar can look to the Australian dollar trends.
Global economic growth failed to improve, and the Dow bounced back. Just as the USDJPY followed the Dow and Nikkei, the dollar/yen traded back and forth between 105 and 106 levels. It's worth noting that there are three US dominant data performances today. Among them, the Michigan consumer confidence index in August is more critical. The performance of the Dow and Nikkei will drag the USDJPY. If US economic data is flat or positive today, the stock market expected to rebound, while the USDJPY rise.
Crude oil futures prices have fallen since last week's drawdown in U.S. crude oil inventories, which has weighed against the Canadian dollar. Besides, speculation of a recession in the United States and around the world increased the risk of a fall in the price of crude oil and the Canadian dollar fell. Between Europe and US trading hours, watch OPEC monthly oil market report. The report reflects supply and output, which can affect the price of crude oil. Besides, the US dollar is now expected to fall; the Canadian dollar may rise. Technically, pay attention to the resistance of 1.3335 and 1.3350, and look down at the support of 1.3265 and 1.3215.
US crude oil futures
The US government has delayed implementing the extra tariffs for some Chinese imports, and China and the US have agreed to hold the talks in September, hoping to receive bullish oil price news. Between Europe and US trading hours, watch OPEC monthly market report. The report reflects supply and output, which can affect the price of crude oil. It's worth watching U.S. economic data. If the data is weak, the federal reserve's signal that it will consider a rate cut next month could drive bullish oil prices.
Expected weak US data, US Treasury yields could be upside down again. If the stock market falls, there is another excuse to push up the price of gold. U.S. economic data and U.S. interest rate futures are also noteworthy when referring to gold prices. , it is recommended to apply to the Dow's performance. If the dow rises, it could hurt gold prices. If today's U.S. economic data is flat, improving U.S. Treasury yields upside down, the Dow rebounding, gold prices may be adjusted, or even below $1,500. On the contrary, 1529 and 1534 dollar resistance.
U.S. Dow Jones industrial average futures US30
Weak data in the US and a slower outlook for global growth. Treasury yields could be upside down again, with the Dow falling early last night. Looking ahead to U.S. data, the Dow is trading in a narrow range amid expectations of weakness and a possible federal reserve rate cut next month. If the likelihood of a U.S. recession increases, a potential presidential speech to improve relations with China could lift the Dow. Technically, the Dow broke through 25860 support, down to adjust wave, 25395 again. Hopefully, Dow could get a rebound today if U.S. economic data isn't as weak as market expectations, U.S. - China relations do well, or the federal reserve considers interest rate cuts.
10650 / 10900 resistance
10050 / 9850 support
As the trade war between China and the US cool down. Decreasing the cryptocurrencies demands. However, markets are expecting weak U.S. economic data and a slower outlook for global growth today. US treasury yields probably upside down again, Fed may cut interest rates. It perhaps an excuse to purchase cryptocurrencies for against any risks. Recently here we mentioned, the sentiment may be changes, bearish bitcoin and other cryptocurrencies. Also, here recommend check out the trends of gold price and the bitcoin price in the same direction.
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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