Dollar Mostly Subdued Against Major Rivals

Trading 01 avr 2019 Commentaire »

The U.S. dollar was mostly subdued against major currencies on Monday as it lost some of its safe haven appeal as worries about growth faded a bit after data showed a jump in Chinese manufacturing sector activity in the month of March.

Rising optimism about U.S.-China trade talks too weighed on the greenback as investors chose to pick up equities.

Economic data from the U.S. was a mixed bag, with data on retail sales showing a drop in February, and the ISM Manufacturing Index for March rising above expectations. Construction spending too increased in February, beating expectations.

A report from the Institute for Supply Management showed an unexpected increase by its index of activity in the manufacturing sector in the month of March.

The ISM said its purchasing managers index rose to 55.3 in March after falling to 54.2 in February, with a reading above 50 indicating growth in the manufacturing sector. Economists had expected the index to come in unchanged.

Data from the Commerce Department showed U.S. retail sales unexpectedly dipped by 0.2% in February after climbing by an upwardly revised 0.7% in January. Economists had expected sales to rise by 0.3% compared to the 0.2% uptick originally reported for the previous month.

The dollar index was up slightly at 97.27, after moving in the range of 97.03 - 97.30.

According to official data, Chinese factory activity in March unexpectedly grew for the first time in four months, according to official data. The Caixin/Markit Manufacturing Purchasing Managers' Index rose to 50.8 from 49.9 in February, recording the strongest reading in eight months.

The dollar was down by about 0.009% against the Yuan, at 6.7115 yuan a dollar.

The euro shed about 0.05% against the greenback, falling to $1.1212, weighed by weak eurozone data. In economic releases, official data showed that the euro zone manufacturing sector saw its biggest contraction for nearly six years in March, as demand and output slumped.

In other economic news from eurozone, inflation slowed in March, defying expectations for stability, while the unemployment rate remained unchanged in February.

Even as Brexit uncertainty continued, U.K. manufacturing sector grew at the fastest pace in over a year in March, as stockpiling by businesses hit a record, survey data from IHS Markit showed.

The dollar was weak against the British Pound, ahead of outcome of another voting by British MPs on Brexit alternatives. The lawmakers have been asked to vote on four options, including a customs union and a referendum.

The Pound Sterling was up 0.6% with a sterling fetching $1.3114, rising from a low of $1.3009.

Against the loonie, the dollar was down 0.24%, at 1.3317, despite weak manufacturing sector activity in Canada. The IHS Markit Canada Manufacturing Purchasing Managers' index, a measure of manufacturing business conditions, came in with a reading of 50.5 for March, its lowest since September 2016, from 52.6 in February.

The Aussie was gaining 0.27%, with the AUS/USD pair trading at 0.7115. The dollar was up 0.4% against the franc, at 0.9992,

The Japanese yen was down against the greenback, with a unit of the latter fetching 111.35 yen, after closing at 110.86 on Friday.


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

Oil Futures Settle Sharply Higher On Positive Economic Data

Trading 01 avr 2019 Commentaire »

Crude oil prices rose sharply on Monday, as worries about global energy demand eased after data showed a notable improvement in manufacturing activity in the world's second largest economy.

OPEC-led output cuts and sanctions on U.S. sanctions Iran and Venezuela continued to support crude oil prices.

West Texas Intermediate Crude oil futures for May ended up $1.45, or 2.4%, at $61.59 a barrel, the highest level in nearly five months.

On Friday, oil futures for May ended up $0.84, or 1.4%, at $60.14 a barrel.

With today's gains, crude oil futures have nearly 35% since the beginning of this year.

Crude output from OPEC dropped for a fourth month as Saudi Arabia continued with output curbs aimed at balancing global markets. Escalating economic crisis in Venezuela too tightened the energy market.

According to a report from Baker Hughes last Friday, U.S. energy firms reduced the number of oil rigs operating to their lowest in nearly a year, cutting the most rigs during one quarter in three years. In the January - March quarter, the rig count dropped by 69. In January - March 2016 quarter, the rig count had fallen by 164.

In the week to March 29, oil rig count dropped by eight, to 816, falling for a sixth straight week. For the month, the rig count fell by 37, the most in a month since April 2016.

In economic news, Chinese factory activity in March unexpectedly grew for the first time in four months, according to official data. The Caixin/Markit Manufacturing Purchasing Managers' Index rose to 50.8 from 49.9 in February, recording the strongest reading in eight months.

On the trade front, U.S.-China trade talks are reported to be progressing well, with Washington saying the negotiations that concluded on Friday in Beijing were "candid and constructive".

Beijing announced that it would continue to suspend additional tariffs on U.S. vehicles and auto parts after April 1 as a gesture after Washington delayed tariff hikes on Chinese imports.

A delegation led by Vice Premier Liu He will be in Washington this week for another round of talks.


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

Treasuries Move Significantly Lower On Upbeat Manufacturing Data

Trading 01 avr 2019 Commentaire »

Treasuries moved significantly lower during the trading day on Monday, extending the pullback seen over the two previous sessions.

Bond prices came under pressure early in the session and saw further downside as the day progressed. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, jumped by 8.3 basis points to 2.497 percent.

The initial weakness among treasuries came as continued optimism about U.S.-China trade talks as well as a upbeat Chinese manufacturing data reduced the appeal of safe haven assets such as bonds.

Official data showed Chinese manufacturing activity unexpectedly grew for the first time in fourth months in March.

A private survey also showed the manufacturing sector in the world's second biggest economy returning to growth.

Additionally, Beijing has announced that it will continue to suspend additional tariffs on U.S. vehicles and auto parts after April 1 as a gesture after Washington delayed tariff hikes on Chinese imports.

A delegation led by Chinese Vice Premier Liu He is headed to Washington later this week for another round of trade talks.

Treasuries saw further downside following the release of a report from the Institute for Supply Management unexpectedly showing a faster rate of growth in U.S. manufacturing activity in the month of March.

The ISM said its purchasing managers index rose to 55.3 in March after falling to 54.2 in February, with a reading above 50 indicating growth in the manufacturing sector. Economists had expected the index to come in unchanged.

"Comments from the panel reflect continued expanding business strength, supported by gains in new orders and employment," said Timothy Fiore, Chair of the ISM Manufacturing Business Survey Committee. Meanwhile, traders largely shrugged off a separate report from the Commerce Department showing an unexpected decrease in U.S. retail sales in February.

The report said retail sales dipped by 0.2 percent in February after climbing by an upwardly revised 0.7 percent in January.

Economists had expected sales to rise by 0.3 percent compared to the 0.2 percent uptick originally reported for the previous month.

Excluding a rebound in sales by motor vehicle and parts dealers, retail sales fell by 0.4 percent in February after jumping by a revised 1.4 percent in January.

Ex-auto sales had been expected to climb by 0.4 percent compared to the 0.9 percent increase originally reported for the previous month.

Following the slew of U.S. economic data released today, trading on Tuesday may be impacted by reaction to a report on durable goods orders in February.


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Gold Futures Settle Lower As Traders Seek Riskier Assets

Trading 01 avr 2019 Commentaire »

Gold prices edged lower on Monday, as optimism about trade talks and encouraging factory data out of the U.S. and China prompted traders to seek riskier assets such as equities.

The U.S. dollar was subdued as well, after coming off three-week highs.

Gold futures for June ended down $4.30, or 0.3%, at $1,294.20 an ounce.

On Friday, gold futures for June ended up $3.20, or 0.2%, at $1,298.50 an ounce.

Silver futures for May ended down $0.011, at $15.099 an ounce, while Copper futures for May settled at $2.9245, down $0.0115 from previous close.

In U.S. economic news, a report from the Institute for Supply Management showed an unexpected increase by its index of activity in the manufacturing sector in the month of March.

The ISM said its purchasing managers index rose to 55.3 in March after falling to 54.2 in February, with a reading above 50 indicating growth in the manufacturing sector. Economists had expected the index to come in unchanged.

"Comments from the panel reflect continued expanding business strength, supported by gains in new orders and employment," said Timothy Fiore, Chair of the ISM Manufacturing Business Survey Committee.

The report said the new orders index climbed to 57.4 in March from 55.5 in February, while the production index ticked up to 55.8 from 54.8.

The employment index also surged up to 57.5 in March from 52.3 in February, indicating a notable acceleration in the rate of job growth in the manufacturing sector. The index reached its highest level since November of 2018.

In news from China, factory activity in March unexpectedly grew for the first time in four months, according to official data. The Caixin/Markit Manufacturing Purchasing Managers' Index rose to 50.8 from 49.9 in February, recording the strongest reading in eight months.

On the trade front, Beijing announced that it would continue to suspend additional tariffs on U.S. vehicles and auto parts after April 1 as a gesture after Washington delayed tariff hikes on Chinese imports.

A delegation led by Vice Premier Liu He will be in Washington this week for another round of talks.


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

April 1, 2019 : EUR/USD intraday technical levels and trade recommendations.

Trading 01 avr 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 1.1220 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, a bullish breakout above 1.1235 would initiate another bullish pullback towards 1.1280-1.1320 where a better SELL entry can be offered.

Trade recommendations :

Conservative traders should wait for abullish pullback towards 1.1280-1.1320 for a low-risk SELL entry.

TP levels to be located around 1.1200, 1.1170 and 1.1120. SL to be located above 1.1350.

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

April1, 2019 : GBP/USD approaching a confluence of supply levels to be watched

Trading 01 avr 2019 Commentaire »

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On January 2nd, the market initiated the depicted uptrend line around 1.2380.

This uptrend line managed to push price towards 1.3200 before the GBP/USD pair came to meet the uptrend again around 1.2775 on February 14.

Another bullish wave was demonstrated towards 1.3350 before the bearish pullback brought the pair towards the uptrend again on March 11.

A weekly bearish gap pushed the pair slightly below the trend line (almost reaching 1.2960) before the bullish breakout above short-term bearish channel was achieved on March 11.

Bullish persistence above 1.3060 allowed the GBPUSD pair to pursue the bullish momentum towards 1.3130, 1.3200 then 1.3360 where the recent bearish pullback was initiated.

Bullish persistence above 1.3250 was needed for confirmation of a bullish Flag pattern. However, significant bearish pressure was demonstrated below 1.3250 demonstrating a false bullish breakout above 1.3200 (the upper limit of the depicted bearish channel).

Hence, the short term outlook turned to become bearish towards 1.3150 - 1.3120 where the depicted uptrend line failed to provide any immediate bullish support.

By the end of last week, the price levels of 1.3020-1.3000 (the lower limit of the depicted movement channel) demonstrated significant bullish rejection which pushed the pair up towards the price zone of (1.3150-1.3160) where the backside of the broken uptrend line is located.

Trade Recommendations:

Intraday traders can have a valid SELL entry around the upper limit of the movement channel as well as the backside of the broken uptrend line (1.3160-1.3180).

SL to be located above 1.3200. TP levels to be located around 1.3100 and 1.3020.

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

Elliott wave analysis of GBP/JPY for April 1, 2019

Trading 01 avr 2019 Commentaire »

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The break above above 145.50 has confused our bearish outlook. At this point, we have to take a neutral stand and await a more clear count before engaging again.

A break above resistance at 146.47 will shift the short-term bias towards the upside for a new rally towards 148.50 and 151.50 as the next targets. On the other hand, a break below 143.79 will confirm more downside pressure towards 141.00 before a corrective low should be in place.

R3: 148.03

R2: 147.38

R1: 146.47

Pivot: 145.55

S1: 145.13

S2: 144.85

S3: 144.36

Trading recommendation:

Our stop at 145.50 was hit for a loss and we has taken a neutral stand for now.

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

Elliott wave analysis of EUR/JPY for April 1, 2019

Trading 01 avr 2019 Commentaire »

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EUR/JPY has broken above minor resistance at 124.74, which indicates the corrective consolidation from 123.82 is still developing and likely will cause a minor pop to 125.27 before turning around again towards the downside.

It will take an unexpected break above resistance at 126.18 to shift the bias towards the upside again.

R3: 125.27

R2: 129.95

R1: 124.74

Pivot: 124.56

S1: 124.12

S2: 123.75

S3: 123.37

Trading recommendation:

We are short EUR from 124.25 with our stop placed at 126.20.

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

U.S. Construction Spending Unexpectedly Jumps 1.0% In February

Trading 01 avr 2019 Commentaire »

Construction spending in the U.S. unexpectedly showed a significant increase in the month of February, according to a report released by the Commerce Department on Monday.

The Commerce Department said construction spending surged up by 1.0 percent to an annual rate of $1.320 trillion in February after spiking by an upwardly revised 2.5 percent to a rate of $1.307 trillion in January.

Economists had expected construction spending to dip by 0.2 percent compared to the 1.3 percent jump originally reported for the previous month.

The unexpected increase in construction spending came as spending on public construction soared by 3.6 percent to an annual rate of $325.8 billion in February.

Spending on highway construction led the way higher, skyrocketing by 9.5 percent to a rate of $111.1 billion, while spending on educational construction climbed by 0.8 percent to a rate of $76.3 billion.

The report said spending on private construction spending also rose by 0.2 percent to an annual rate of $994.5 billion in February.

The Commerce Department said an increase in spending on residential construction more than offset a drop in spending on non-residential construction.

Reflecting another monthly increase, construction spending in February was up by 1.1 percent compared to the same month a year ago.


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

U.S. Business Inventories Climb More Than Expected In January

Trading 01 avr 2019 Commentaire »

A report released by the Commerce Department on Monday showed business inventories in the U.S. increased by more than expected in the month of January.

The Commerce Department said business inventories climbed by 0.8 percent in January, matching the upwardly revised increase in the previous month. Economists had expected inventories to rise by 0.5 percent.

The report showed wholesale inventories surged up by 1.2 percent, while retail and manufacturing inventories increased by 0.8 percent and 0.5 percent, respectively.

Meanwhile, the Commerce Department said business sales rose by 0.3 percent in January after slumping by 0.9 percent in the previous month.

Retail and wholesale sales climbed by 0.8 percent and 0.5 percent, respectively, more than offsetting a 0.4 percent drop in manufacturing sales.

With inventories rising by more than sales, the total business inventories/sales ratio edged up to 1.39 in January from 1.38 in December.


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