Italy Service Sector Contracts For First Time Since May 2016

Trading 06 nov 2018 Commentaire »

Italy's service sector activity declined for the first time in nearly two-and-a-half years in October, amid slower growth in new business, survey data from IHS Markit showed on Tuesday.

The services Purchasing Managers' Index, or PMI, fell to 49.2 in October from 53.3 in September. Economists had forecast a score of 52.

A PMI reading below 50 suggests contraction in the sector.

New business grew at the slowest pace in 44 months amid subdued client demand. Consequently, job creation fell to a 14-month low.

Profit margins remained under pressure as selling prices fell for a ninth month, while operating costs registered strong growth.

Meanwhile, business confidence remained solid with over a third of businesses expecting activity to be higher in a year's time.


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Gold Edges Higher As Dollar Retreats Slightly

Trading 06 nov 2018 Commentaire »

Gold prices were edging higher after a slightly weak start, with traders seeking the safe haven investment after the dollar pared some early gains ahead of US midterm elections and the Federal Reserve's monetary policy meeting.

The Fed is expected to hold rates unchanged this month. The central bank's accompanying statement is likely to provide clues about future rate hikes.

The dollar index, which advanced to 96.51 on Monday and was holding steady around 96.25 earlier this morning, is currently at 96.13, up marginally from previous close.

Gold futures for December were up $7.20, or 0.59%, at $1,237.00 an ounce.

Silver futures for December were advancing by $0.038, or 0.26%, at $14.685 an ounce.

Copper futures for December were flat $2.756 per pound.

In economic news, eurozone private sector expanded at the weakest pace in over two years in October as both manufacturing and services recorded slower rates of growth, latest survey data from IHS Markit showed on Tuesday.

Eurozone's producer price inflation accelerated for a fifth straight month in September, preliminary data from Eurostat showed. Producer prices grew 4.5% year-on-year following a 4.3% increase in August, which was revised from 4.2%. Economists had forecast a 4.3% rise in prices.

The Service sector in UK registered its slowest rate of expansion in seven months in October.

A report from IHS Markit and the Chartered Institute of Procurement & Supply on Monday showed the service sector in UK to have registered its slowest rate of expansion in seven months in October. The services Purchasing Managers' Index dropped more-than-expected to 52.2 in October from 53.9 in September. The expected level was 53.4.

In the U.S. midterm elections, the Democrats are expected to regain control of the House while Republicans are expected to hold on to a slim majority in the Senate. Reuters notes that if Republicans retain their House majority, global stocks are likely to rally on hopes of more tax cuts.


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Spain Service Sector Growth Improves

Trading 06 nov 2018 Commentaire »

Spain's services sector expanded at a faster pace in October, thanks to a strong gain in new orders, survey data from IHS Markit showed on Tuesday.

The services Purchasing Managers' Index, or PMI, rose to 54 from 52.5 in September. Economists had forecast a score of 51.8.

A PMI score above 50 suggests growth in activity and the latest reading was the strongest since June.

The Spanish services sector has expanded in each month throughout the past five years, IHS Markit said.

Despite the marked gain in new business, employment growth was at a two-year low due to subdued business confidence and cost pressures intensified amid higher prices of fuel and energy.

Output prices rose only slightly due to a further squeeze on operating margins.


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Australian Dollar Extends Rally After RBA Raises Economic Growth Forecast

Trading 06 nov 2018 Commentaire »

The Australian dollar continued to be higher against its major counterparts in the European session on Tuesday, after the Reserve Bank of Australia kept its interest rate on hold and slightly upped its growth forecast for this year and next.

The board of the Reserve Bank of Australia, governed by Philip Lowe, voted to maintain the cash rate at 1.50 percent. The interest rate has been at the current level since August 2016.

"Taking account of the available information, the Board judged that holding the stance of monetary policy unchanged at this meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time," the bank said in a statement.

The bank raised its forecast for economic growth in 2018 and 2019, which is expected to average around 3.5 percent. Earlier, the bank expected GDP growth to average 3.25 percent for both this year and next.

Meanwhile, caution prevailed ahead of key economic and political events scheduled for the week, which includes the midterm elections in the U.S., and the Federal Reserve's monetary policy review.

In the US midterm elections, it is expected that the democrats will regain control of the House while Republicans hold on to a slender majority in the Senate. Reuters is of the view that global stocks may rally on hope of more tax cuts if Republicans retain their House majority.

The currency has been trading in a positive territory against its major counterparts in the Asian session.

The aussie strengthened to a 4-day high of 0.7240 against the greenback, from a low of 0.7205 hit at 10:15 pm ET. The aussie is poised to find resistance around the 0.74 level.

The aussie firmed to 81.97 against the yen, its highest since October 2. The aussie is seen finding resistance around the 83.00 region.

Data from the Ministry of Internal Affairs and Communications showed that Japan household spending fell 1.6 percent on year in September, coming in at 271,273 yen.

That was well shy of expectations for an increase of 1.5 percent and down sharply from the 2.8 percent gain in August. After falling to 1.5832 against the euro at 10:15 pm ET, the aussie reversed its course and touched a 4-day high of 1.5755. On the upside, 1.55 is possibly seen as the next resistance level for the aussie.

Survey data from IHS Markit showed that Eurozone's private sector expanded at the weakest pace in over two years in October as both manufacturing and services recorded slower rates of growth.

The composite Purchasing Managers' Index, or PMI, fell to 53.1 from September's 54.1. The reading was the lowest since September 2016. The flash reading for the composite PMI was 52.7.

The aussie appreciated to 0.9497 against the loonie, a level not seen since September 6. Next key resistance for the aussie is likely seen around the 0.96 area.

The aussie held steady against the kiwi, after having advanced to a 4-day high of 1.0851 at 11:30 pm ET. The pair was valued at 1.0813 when it closed deals on Monday.

Looking ahead, at 8:30 am ET, Canada building permits for September will be out.


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Crude Oil Edges Lower On Demand Growth Concerns

Trading 06 nov 2018 Commentaire »

Crude oil prices are edging lower Tuesday morning, amid prospects of a drop in demand for crude due to the likely impact of the ongoing U.S.- China trade disputes on global economic growth.

Last week's data from the U.S. Energy Information Administration revealed that U.S. crude stockpiles increased for a sixth successive weak, although the increase was less than expected.

Also, with output from Saudi Arabia and Russia rising notably and the Trump administration granting sanctions exemptions to some top buyers of Iranian oil, including India, China and South Korea, supply worries are subsiding fast.

Crude oil futures for December were drifting down by $0.30, or 0.49%, to $62.80 a barrel. On Monday, crude oil futures ended down $0.04, or less than 0.1%, at $63.10 a barrel.

The American Petroleum Institute will come out with its weekly oil report after trading hours today.

The official crude inventory data from the Energy Information Administration is due on Wednesday morning.


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Russia Services Growth At 11-Month High

Trading 06 nov 2018 Commentaire »

Russia's services sector expanded the most in nearly a year during October, boosted by solid growth in both output and new business, survey data from IHS Markit showed on Tuesday.

The services Purchasing Managers Index climbed to 56.9 from 54.7 in September. Economists had forecast a reading of 54.5.

A PMI score above 50 suggests growth in activity and the latest reading was the highest since November 2017.

Survey participants attributed the rise in output to a faster increase in new orders. Service sector employment grew for the first time since May. Inflationary pressures continued to build.

The composite PMI, which combined manufacturing and services, rose to 55.8 from 53.5 in September. The reading was the strongest thus far this year.


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USD/JPY analysis for November 06, 2018

Trading 06 nov 2018 Commentaire »

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Recently, the USD/JPY pair has been trading upwards. The price tested the level of 113.44. Anyway, according to the H1 time – frame, I have found the fake breakout of the resistance at 113.37, which is a sign that buyers got trapped. I have also found broken upward trendline, which is a sign that sellers are in control. My advice is to watch for selling opportunities. The downward target is set at the price of 112.60.This bearish idea will be invalid if the price breaks the level of 113.45.

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EUR/USD analysis for November 06, 2018

Trading 06 nov 2018 Commentaire »

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Recently, the EUR/USD pair has been trading upwards. The price tested the level of 1.1425. According to the H1 time – frame, I have found a potential end of the downward correction (expanded flat) in the background, which is a sign that selling looks risky. Most recently, I found the breakout of the intraday bullish flat, which is a sign that buyers are in control. My advice is to watch for buying opportunities. The upward take profit levels are set at the price of 1.1450 and at the price of 1.1503.

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Today, the market is focused on voting in the US Congress

Trading 06 nov 2018 Commentaire »

After D. Trump was encouraged by markets last week with a statement that he had a new trade proposal for China, the fall in global stock markets stopped. And in the foreign exchange market, the US dollar passed some of of the positions it won.

After D. Trump was encouraged by the markets last week with a statement that he had a new trade proposal for China, the fall in global stock markets stopped, and the US dollar passed some of the previously won positions on the foreign exchange market.

After a wave of euphoria, investors are currently trying to understand for themselves what the president's words are - another trick in his not too subtle economic and political struggle with competitors both inside and outside the country, or is he really following his old tradition after heavy pressure on the opponent begins to hand back, while hoping to get what he want.

Assessing the existence of such sentiments, we believe that activity in the foreign exchange market, and in general in world markets, is likely to be before November 30, when the G20 Summit will take place. But the situation may change radically and high volatility may return to the markets again.

We have in mind today's vote in the US Congress. If the Republicans win, then Trump will have strong support in his internal and external affairs. But if the victory comes from the Democrats, this will most likely lead to strong movements in the US financial market which can also contribute to a strong increase in volatility and a resumption falling local stock market which at the same time may lead to an increase in demand for the dollar as an asset safe haven.

We have no doubt that this event can overshadow all the news that will be released today, since the degree of tension that has developed between the personality of the 45th President of the United States and his ideological opponents that can plunge local political life chaos with all the negative consequences. Based on this scenario, it is necessary to exercise caution in making decisions.

From the economic statistics data released today, the values of the business activity index in the services sector of Germany and the euro zone, as well as the figures for production inflation in the euro area, will attract attention.

Forecast of the day:

The EURGBP pair is trading above the level of 0.8725, generally remaining in the "outset". It can turn up and rush to 0.8780 in the wake of positive data on industrial inflation in the euro zone if it holds above 0.8725.

The EURJPY pair is trading below the level of 129.30. The pair also has the potential for local growth in the wake of positive data on inflation from the euro zone. The intersection of the price level of 129.30 may lead the pair to rise to 130.15.

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Analysis of the divergence of EUR / USD for November 6. Eurocurrency chances for growth are small

Trading 06 nov 2018 Commentaire »

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The EUR / USD currency pair made a return to the correctional level of 76.4% - 1.1422. The release of quotes from this Fibo level will allow traders to expect a reversal in favor of the American currency and a resumption of decline in the direction of the correction level of 100.0% - 1.1303. There is no maturing divergence in any indicator. Fixing the pair above the Fibo level of 76.4% will increase the chances for further growth in the direction of the next correctional level of 61.8% - 1.1497.

The Fibo grid is built on extremes from August 15, 2018, and September 24, 2018.

Daily

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On the 24-hour chart, the pair made a U-turn in favor of the euro currency around the correctional level of 127.2% - 1.1285 and started the growth process in the direction of the correction level of 100.0% - 1.1553. The ripening divergences on the current schedule on November 6 are not observed. Fixing the pair below the Fibo level of 127.2% will work in favor of the American currency and resuming the fall in the direction of the correctional level of 161.8% - 1.0941.

The Fibo grid is built on extremums from November 7, 2017, and February 16, 2018.

Recommendations to traders:

New purchases of the EUR / USD currency pair can be made with the target of 1.1497 and a Stop Loss order below the Fibo level of 76.4% if the pair closes above the correction level of 1.1422.

Sales of the EUR / USD currency pair will be possible with the goal of 1.1303 with a Stop Loss order above the Fibo level of 76.4% if the pair bounces the correction level of 1.1422.

The material has been provided by InstaForex Company - www.instaforex.com