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ATFX Market Outlook, 2019 Aug 27
Personal opinions today:
The Dow fell on Friday, and Asian stocks also fell in early trading as the US raised tariffs on $550 billion of Chinese imports. The dollar index had fallen as low as 97, while the dollar fell sharply against the yuan to close at 7.19. Risk aversion has risen, with gold prices and the yen rose sharply. Following US President Donald Trump's remarks yesterday that China called Washington to confirm and continue the trade talks in September, Trump welcomed. Then Dow futures rebounded, while Asian stocks regained some of their losses. Of course, U.S. durable goods orders were higher than expected in July, and the dollar's strength pushes the gold prices, and the yen goes lower, while crude oil futures traded as high as $55.
Earlier today in Europe, the Euro was already downward after Germany released its final quarterly GDP estimate for the second quarter, which was expected to be flat. If the German data turn out to be weaker than market expectations, that could trigger a dip in the Euro. For the US data today, the figures only for reference. Among them, the Richmond Fed manufacturing index in August and the consumer confidence index in August is more critical but less influential. Perhaps the most crucial time of day in the US trading hours. When the President's comments were more closely watched. Both the Fed's monetary policy and China and US relations are the focus of the market, making global markets volatile.
[Important financial data and events]
14:00 German Q2 GDP final
21:00 U.S. FHFA home price index for June
21:00 U.S. Us cities Housing prices in June
22:00 U.S. Richmond Fed manufacturing index for August
22:00 U.S. CB consumer confidence index for August
Next day 04:30 US API crude oil inventories change
The Fed chairman dovish speech and the US has raised extra tariffs on Chinese imports, which has strained relations with China and the dollar down earlier yesterday. European data were weak, with Germany's IFO business climate index falling in August and U.S. durable goods orders unexpectedly rising in July. The Euro failed to stay strong, falling from its high. Technically, the Euro's preliminary suggested support level against the dollar is above 1.1110, and if German data continues to be weak today, the Euro could test support at 1.1060. The euro's resistance level against the dollar was lowered by weaker European data than the U.S. data. The Euro has an opportunity to test resistance to 1.1135 or 1.1160 if U.S. economic data show weakness or if the chances of the Fed may cut interest rates in September. If EURUSD falls, the Euro could fall further until the U.S. releases its revised second-quarter real GDP figure on Thursday.
The G7 meeting ended after the British prime minister softened his stance on EU demands for a Brexit. The British prime minister accepted the European commission's proposal to revise the backup plan on the Irish border in the hope of pushing for an agreed Brexit at the end of October. Yesterday here said that under routine procedures, the U.K. prime minister would have to successfully lobby MPS who support a hard Brexit to reach a consensus. But the estimate success rate is not high, pound face confidence crisis at any time, adjust significantly. Pound lack of reasons to rise believe in paying attention to the downside risks. If the pound breaks through the 1.2215 support, it will test the 1.20 level. Technically, the adjusted fall in the pound's rebound within a week is expected to lead to the lower support of 1.2170 and more likely to fall further before the United States releases its revised Q2 real GDP on Thursday.
The Australian dollar rebounded on news that trade talks between the United States and China were expected to resume in mid-september, easing the investment climate. But after the rally, the only thing left to watch is whether the fed's monetary policy and US President Donald Trump's comments will bring the AUDUSD up. Otherwise, the Australian dollar's gains could be halted ahead of Thursday's U.S. real GDP revision. Technically, this analysis has pointed out before that the Australian dollar is concerned about the resistance of 0.6785 against the us dollar. If it fails to break through, the trend will adjust, and the New Zealand dollar will also follow the trend of the Australian dollar.
The trade war between China and the United States escalated, but negotiations continued in mid-september to reassure the market. The Dow and the global stock market rebounded, while the dollar rebounded against the yen following the Dow and Nikkei. For now, the dollar is getting a boost against the yen in the belief that good news in the markets is easing trade war tensions. Any comments add to market against market sentiment, the USDJPY could continue to fall. Technical analysis points to the observation of USDJPY resistance 105.80 and 106.00 resistance yesterday. The USDJPY did not break through the resistance completely, careful trend reversal, its more important to watch the Dow and Nikkei trends.
Relations between China and the United States have improved, with the U.S. President saying before the end of the G7 summit that he is willing to talk and negotiate with Iran and seek to ease U.S. sanctions against Iran. Crude oil prices have rebounded, the Canadian dollar indirectly benefited from the rise. Technically, the previous conservative estimates of dollar support were 1.3275 and 1.3260. With the help of the rising crude oil price and the easing trade war atmosphere, the USDCAD exceeded the original support target. If the crude oil price is well established, the USDCAD has the opportunity to test the support of 1.3205.
US crude oil futures
The market will wait to see the U.S. API and EIA inventories change tomorrow, crude oil prices rise limit. If the dovish comments of the Fed chairman are extrapolated, the China and US trade talks will continue, which is expected to increase crude oil prices. But the administration's willingness to negotiate with Iran to defuse sanctions could increase supplies and limit price increases. Technical crude oil resistance remained at 55.10. Expect fed chairman to boost oil prices with more dovish comments and a reduction in U.S. API and EIA inventories. Otherwise, watch crude oil prices dip.
The trade tensions between China and the United States escalated, and the stock market fell sharply. Fed chairman releases dovish comments, gold prices soar. But China and US relations improving, through a telephone call between the two trade ministers yesterday, provided good news, eased tensions and adjusted the gold price. News and comments on the gold price is very sensitive, please more focus and catch up the market news. Second, you can watch the Dow futures fluctuations at the same time to catch up the gold price.
U.S. Dow Jones industrial average futures US30
The trade tensions between China and the United States has shown easing, with U.S. durable goods orders over market expectations and investment sentiment back. Dow rebounded. Next, the markets will be watching Thursday for the release of revised U.S. real GDP in Q2 figures. In addition, if the trade war between China and the U.S. eases further, it could keep the Dow up. More importantly, U.S. markets typically take note of comments from the federal reserve and the US President speaks during US trading hours, and if the bullish mood, the Dow could technically test for higher resistance.
10600 /10850 resistance
10150 / 9950 support
Looking trade tensions between the US and China early yesterday, bullish the bitcoin price and followed the gold price rose. However, trade tensions cool down. It is because China intended to going trade talks in September. As mentioned yesterday, If no intention to cool down the tensions, the bitcoin price could rise further. Now we seem it may cool down; the bitcoin price could fall a bit. Technically, it supports may looking at 9950.
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.
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