Dollar Exhibits Strength Against Major Rivals

Trading 28 mar 2019 Commentaire »

The U.S. dollar gained against most of its major rivals on Thursday, amid growing signs of global economic slowdown.

Data from the U.S. Commerce Department showed a drop in U.S. GDP reading for the final quarter of 2018. The data showed U.S. economic growth slowed by more than previously estimated in the fourth quarter.

The report said GDP climbed by 2.2% percent in the fourth quarter compared to the previously reported 2.6% increase. Economists had expected the pace of growth to be downwardly revised to 2.4%.

With the downward revision, the pace of GDP growth in the fourth quarter is notably slower than the 3.4% jump in the third quarter.

The U.S. Federal Reserve described its current policy as being "patient as it determines what future adjustments to the target range for the federal funds rate may be appropriate." The central bank downgraded its assessment of the economy, and in its Summary of Economic Projections (SEP) it downgraded its economic forecasts.

The European Central Bank President Mario Draghi said earlier this week that "adjusting forward rate guidance" is an option to fulfill the bank's inflation target of close but below 2%, hints at monetary policy easing by the central bank.

The Reserve Bank of New Zealand joined the list of central banks that came out with dovish comments about monetary policy outlooks, given the state of global economy.

The New Zealand central bank today left its key policy rates unchanged and hinted that its next move with regard to interest rates will be a cut.

The dollar index gained nearly 0.4%, rising to 97.30.

The greenback exhibited notable strength against most of its rivals.

Amid growing prospects of a chaotic Brexit, the pound sterling traded weak against the greenback, with a unit of euro fetching $1.3058, down by about 1% from previous close of $1.3191.

On Wednesday night, the British Lawmakers rejected all alternative Brexit plans. The European Union had said earlier that if Parliament supported a modified deal, it would extend the exit deadline to May 22, but in the event of the parliament rejecting it again, then Britain has time only till April 12 to plan its moves.

Against the Euro, the dollar was up 0.17% at $1.1223

The Japanese yen was down by about 0.1% against the dollar, trading at 110.61 yen.

The Aussie was down 0.1% against the U.S. dollar. The greenback was stronger against Swiss franc and the Canadian loonie, gaining 0.1% and 0.25%, respectively, with USD/CHF and USD/CAD pairs trading at 0.9959 and 1.3442.


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Crude Oil Futures Settle Lower Again On Growth Concerns

Trading 28 mar 2019 Commentaire »

Crude oil futures settled modestly lower on Thursday, as an unexpected jump in crude inventories in the U.S. and worries about energy demand due to slowing global economy weighed on prices.

U.S. President Donald Trump's tweet, calling on OPEC to "increase the flow of Oil" contributed as well to crude oil's decline.

The latest batch of economic data from the U.S. and other parts of the globe have further raised concerns about a slowdown in global economy.

After U.S. Federal Reserve, the European Central Bank and the Reserve Bank of New Zealand have spoken about weak outlook for the global economy and hinted at more monetary easing to revive growth.

Uncertainty about Brexit also continue to weigh on global stock and commodity markets.

West Texas Intermediate Crude oil futures for May ended down $0.11, or 0.2%, at $59.30 a barrel.

On Wednesday, crude oil futures for May ended down $0.53, or 0.9%, at $59.41 a barrel.

According to the weekly data released by the Energy Information Administration (EIA) on Wednesday, crude inventories unexpectedly increased by 2.8 million barrels in the week to March 22.

The increase in inventory was due to a 506,000-barrel drop in exports and a 400,000-barrel decline in refinery runs.

The EIA reported today that domestic supplies of natural gas fell by 36 billion cubic feet for the week ended March 22.

In U.S. economic news, a report from the Commerce Department showed U.S. economic growth slowed by more than previously estimated in the fourth quarter.

The report said GDP climbed by 2.2% percent in the fourth quarter compared to the previously reported 2.6% increase. Economists had expected the pace of growth to be downwardly revised to 2.4%.

With the downward revision, the pace of GDP growth in the fourth quarter is notably slower than the 3.4% jump in the third quarter.

Meanwhile, Eurozone's economic sentiment deteriorated at a faster than expected pace in March, and for the ninth month in row, survey data from the European Commission showed on Thursday.

The economic sentiment index fell to 105.5 from 106.2 in February. Economists had expected a score of 105.9.


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Treasuries Show Modest Pullback Following Recent Strength

Trading 28 mar 2019 Commentaire »

After trending higher over the past several sessions, treasuries showed a modest move back to the downside during trading on Thursday.

Bond prices moved lower early in the session and remained in negative territory throughout the session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, ticked up by 1.5 basis points to 2.389 percent.

With the uptick on the day, the ten-year rebounded after ending Wednesday's trading at its lowest closing level since December of 2017.

The modest pullback by treasuries came as traders reacted to reports on progress in the ongoing trade talks between the U.S. and China.

A senior U.S. administration official told Reuters that U.S. and Chinese negotiators have made progress on the details of the written agreements to address U.S. concerns.

"If you looked at the texts a month ago compared to today, we have moved forward in all areas," the official said but noted, "We aren't yet where we want to be."

The report comes as U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin arrive in Beijing for a new round of high-level talks with Chinese officials.

Selling pressure was relatively subdued, however, with traders also digesting a batch of largely disappointing economic data, including a Commerce Department showing GDP growth slowed by more than previously estimated in the fourth quarter.

The Commerce Department said GDP climbed by 2.2 percent in the fourth quarter compared to the previously reported 2.6 percent increase. Economists had expected the pace of growth to be downwardly revised to 2.4 percent.

With the downward revision, the pace of GDP growth in the fourth quarter is notably slower than the 3.4 percent jump in the third quarter.

The National Association of Realtors also released a report showing an unexpected pullback in pending home sales in the month of February.

NAR said its pending home sales index slumped by 1.0 percent to 101.9 in February after soaring by 4.3 percent to 102.9 in January. Economists had expected pending home sales to climb by 0.7 percent.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

Meanwhile, a separate report from the Labor Department showed an unexpected decrease in first-time claims for U.S. unemployment benefits in the week ended March 23rd.

The report said initial jobless claims dipped to 211,000, a decrease of 5,000 from the previous week's revised level of 216,000.

The drop came as a surprise to economists, who had expected jobless claims to rise to 225,000 from the 221,000 originally reported for the previous week.

Another batch of economic data may attract attention on Friday, with traders likely to keep an eye on reports on personal income and spending, new home sales, and consumer sentiment.


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Gold Futures Settle Sharply Lower

Trading 28 mar 2019 Commentaire »

Gold futures declined sharply on Thursday, extending losses to a third successive session, as the dollar gained in strength against most major currencies amid growing worries about global economic slowdown.

The dollar index rose to 97.30, gaining gained nearly 0.4%, with its safe haven appeal turning out to be stronger than the yellow metal today.

Gold futures for April settled at $1,289.80 an ounce, losing $20.60, or 1.6%, the biggest single session loss in about 7 months.

Gold futures for June ended down $21.60, or 1.6%, at $1,295.30 an ounce.

On Wednesday, gold futures for April ended down $4.60, or 0.4%, at $1,310.40 an ounce, after falling $7.60, or 0.6%, a session earlier.

Silver futures for May ended down $0.325, at $14.973 an ounce, while Copper futures for May settled at $2.8725 per pound, gaining $0.0095 for the session.

The dollar rose against major currencies following dovish comments from the European Central Bank and the Reserve Bank of New Zealand.

The ECB President Mario Draghi's recent comments that "adjusting forward rate guidance" is an option to fulfill the bank's inflation target of close but below 2%, hints at monetary policy easing by the central bank.

Meanwhile, the Reserve Bank of New Zealand has kept interest rates unchanged and indicated that its next move would be to lower interest rates.

Mounting uncertainty about Brexit after the British Lawmakers failed to rally behind any single option to exit from the EU aided the dollar's upmove.

On the trade front, reports suggest the possibility of the U.S. and China concluding trade negotiations in the next month or so.

After the current round of discussions in Beijing, officials from the U.S. and China are scheduled to meet next week in Washington for further negotiations.

In U.S. economic news, a report from the Commerce Department showed U.S. economic growth slowed by more than previously estimated in the fourth quarter.

The report said GDP climbed by 2.2% percent in the fourth quarter compared to the previously reported 2.6% increase. Economists had expected the pace of growth to be downwardly revised to 2.4%.

With the downward revision, the pace of GDP growth in the fourth quarter is notably slower than the 3.4% jump in the third quarter.

The National Association of Realtors released a report showing an unexpected pullback in pending home sales in the month of February.

NAR said its pending home sales index slumped by 1% to 101.9 in February after soaring by 4.3% to 102.9 in January. Economists had expected pending home sales to climb by 0.7%.

The Labor Department's report said initial jobless claims dipped to 211,000, a decrease of 5,000 from the previous week's revised level of 216,000.

The drop came as a surprise to economists, who had expected jobless claims to rise to 225,000 from the 221,000 originally reported for the previous week.


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Seven-Year Note Auction Attracts Average Demand

Trading 28 mar 2019 Commentaire »

Finishing off this week's series of long-term securities auctions, the Treasury Department sold $32 billion worth of seven-year notes on Thursday, attracting average demand.

The seven-year note auction drew a high yield of 2.281 percent and a bid-to-cover ratio of 2.54.

Last month, the Treasury also sold $32 billion worth of seven-year notes, drawing a high yield of 2.538 percent and a bid-to-cover ratio of 2.60.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

The ten previous seven-year note auctions had an average bid-to-cover ratio of 2.52.

Today's seven-year note auction came after the Treasury sold $40 billion worth of two-year notes on Tuesday and $41 billion worth of five-year notes on Wednesday.


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Bitcoin analysis for March 28, 2019

Trading 28 mar 2019 Commentaire »

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Trading recommendations:

We found well defined trading range from $4.026 (resistance) and $3.986 (support). In the background, there are double climatic bars, which is indication for potential weakness. Our advice is to watch for potential breakout of the support ($3.986) to confirm further downside and potential distribution. Downward targets are seen at $3.902 and $3.853. Additionaly, there is a bearish divergence on the stochastic oscillator.

With InstaForex you can earn on cryptocurrency's movements right now. Just open a deal in your MetaTrader4.

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March 28, 2019 : EUR/USD Intraday technical analysis and trade recommendations.

Trading 28 mar 2019 Commentaire »

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On January 10th, the market initiated the depicted bearish channel around 1.1570.

The bearish channel's upper limit managed to push price towards 1.1290 then 1.1235 before the EUR/USD pair could come again to meet the channel's upper limit around 1.1420.

Shortly after, the recent bearish movement was demonstrated towards 1.1175 (channel's lower limit) where significant bullish recovery was demonstrated on March 7th.

Bullish persistence above 1.1270 enhanced further bullish advancement towards 1.1290-1.1315 (the Highlighted-Zone) which failed to provide adequate bearish pressure.

On March 18, a bullish breakout attempt was executed above 1.1327 (the upper limit of the Highlighted-zone). This enhanced further bullish movement towards 1.1450 demonstrating a false bullish breakout above the upper limit of the depicted movement channel.

On the other hand, On March 22, significant bearish pressure was demonstrated around 1.1380 leading to the current bearish decline towards 1.1260 then 1.1220.

The short term outlook for EURUSD pair remains bearish towards 1.1170 and 1.1120.

Bearish persistence below 1.1235 (Fibonacci 78.6%) is mandatory to pursue towards the next mentioned bearish targets.

Otherwise, another bullish pullback would be demonstrated towards 1.1280-1.1300.

Trade recommendations :

Based on previous recommendations, for those who sold the EURUSD around 1.1385 should lower their SL to 1.1250 to secure more profits.

Remaining TP levels to be located around 1.1170 and 1.1120.

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EUR./USD analysis for March 28, 2019

Trading 28 mar 2019 Commentaire »

EUR/USD has been trading downwards. Anyway, we see potential oversold condition at the price of 1.1210 and downside looks very limited.

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According to the H1 time – frame, we found potential falling wedge in creation and bullish divergence on the MACD oscillator, which is sign that we might see change in trend dynamic from bearish to bullish. Key short – term support is seen at the price of 1.1177. The potential breakout of the 1.1260 would confirm further upward movement. Resistance levels are seen at 1.1286 and 1.1326.

Trading recommendation: We are long EUR from 1.1224 and with targets at 1.1286-1.1326. Protective stop is placed at 1.1175.

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Analysis of Gold for March 28, 2019

Trading 28 mar 2019 Commentaire »

Gold has been trading downwards as we expected. The Gold reached all three targets from yesterday. Still strong bearish momentum present but with the potential for balancing.

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Our analysis from yesterday went perfectly and all three targets at $1.303.15, $1.298.90 and $1.293.00 were met. Momentum is still strong for downside but we would not advise you to sell anything at this point since we might see potential balancing or corrective rally. Also, there is the key short-term support at $1.280.50.

Trading recommendation: We closed our short position on Gold at $1.293.00 with the profit of 200 pips. We are neutral now but with the view that Gold may visit $1.280.50 in the next period.

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GBP / USD. March 28. Results of the month. Brexit: complete uncertainty.The pound is at a loss

Trading 28 mar 2019 Commentaire »

24-hour timeframe

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The whole world has been waiting for a decision on Brexit for several months. At the end of last year, it seemed that the situation was nearing its end. March is over, and all that can be said about this is complete uncertainty. The only thing in which the British Parliament, Theresa May and the EU leaders agreed is that the Brexit should be postponed. However, there is no unity of opinion. The EU is ready to prolong the UK release dates until April 12, if the Parliament accepts the agreement, and by May 22, in the case of a "tough" scenario. None of these options are suitable for London. Thus, the parties "agreed" to move Brexit "later." And during this time, try to find new points of contact. What are these points, it is difficult to even guess. The pound sterling responds to these events very discreetly. This is amazing. By and large, no deterioration is expected yet, but the very fact that the parties cannot come to a consensus is very alarming. One gets the impression that traders are simply waiting for the first step from strong and large players, in order to later support their decision and follow the trend. If so, then the pound can wait for a strong and sharp collapse. There is only one way out of this situation – the acceptance of the agreement reached by Theresa May. But it does not suit the Parliament. However, in the absence of better options, the "deal" can still be approved by the House of Commons on the third attempt. However, first you need to organize a third vote. If it fails, it will be a complete absurdity, since London cannot even formulate what it wants, what kind of "divorce".

Trading recommendations:

The upward trend in the pair is not broken in the long term. However, the pair is being adjusted now, and trading in complete uncertainty is fraught with increased risks. Thus, we recommend extremely cautious trading in the coming weeks, preferably intraday.

In addition to the technical picture should also take into account the fundamental data and the time of their release.

Explanation of the illustration:

Ichimoku indicator:

Tenkan-sen - the red line.

Kijun-sen - the blue line.

Senkou Span A - light brown dotted line.

Senkou Span B - light purple dotted line.

Chinkou Span - green line.

Bollinger Bands indicator:

3 yellow lines.

MACD Indicator:

A red line and a histogram with white bars in the indicator window.

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