U.S. Manufacturing Index Unexpectedly Indicates Faster Growth In March

Trading 01 avr 2019 Commentaire »

Indicating a faster rate of growth in U.S. manufacturing activity in the month of March, the Institute for Supply Management released a report on Monday showing an unexpected increase by its index of activity in the sector.

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.

On the inflation front, the prices index jumped to 54.3 in March from 49.4 in February, pointing to a return of increasing raw materials prices after a two-month respite.

The ISM is scheduled to release a separate report on Wednesday on activity in the service sector in the month of March

The non-manufacturing index is expected to dip to 58.0 in March from 59.7 in February, although a reading above 50 would still indicate growth in the service sector.


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The task of the bulls EUR/USD is to keep 1.1180

Trading 01 avr 2019 Commentaire »

The general fundamental background of Monday is very different from the fundamental picture of Friday. The panic subsided, risk appetite increased, the configuration of many currency pairs has changed. Events of a global nature still have priority over macroeconomic reports – and this fact today actually "saved" the single currency from the next downward turn. Despite the extremely weak data on the growth of European inflation, the EUR/USD pair showed modest corrective growth, following external fundamental factors.

Inflation in the eurozone has indeed disappointed. After a slight increase in February, the consumer price index returned to the January level, that is, at 1.4%. Core inflation fell even more than forecasts: most experts expected a decline to 0.9% (from the level of 1%), while the release came out at 0.8%. This is the weakest indicator growth rate since April 2018. On the one hand, this result did not come as a surprise after the extremely disappointing data from Germany. Let me remind you that in January, the German consumer price index in annual terms showed a positive trend (+ 1.5%), after a strong decline in January. However, in March, the indicators slowed down again, being at the level of 1.3%. European inflation actually repeats this trajectory.

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On the other hand, today's release served as another reminder that the European Central Bank will not soon recall tightening monetary policy, at least not this year. But if such rates of reduction in core inflation continue to persist, then the option of mitigating the parameters of monetary policy is not excluded.

However, the market actually ignored the most important release, focusing today on larger-scale events. First, there are prospects for ending the trade war between the United States and China. For several weeks, the parties remained silent, which provoked rather alarming rumors about the failure of the negotiation process. But at the weekend, it became known that Beijing did not renew the effect of retaliatory duties on American goods (namely, cars and automotive components from the United States at a rate of 25%), thereby extending the "pause" in effect from January 1. This suggests that China still intends to find a compromise with Washington because such a significant step was made on the eve of the next round of talks to be held this week in the US capital.

The experts also noted the fact that representatives of the Middle Kingdom responded quickly responded to the concerns of the American side about the prospects for the negotiation process. There is another example of a "curves" on the part of Beijing. Thus, the US authorities have repeatedly demanded that the government of the People's Republic of China limit the turnover of fentanyl - the strongest opioid analgesic, which is usually used in medicine as an anesthetic. Americans have long complained about the fact that China is the largest supplier of fentanyl to the US market, while this drug causes addiction, which often leads to an overdose, and often – to death. This issue, which has little to do with the trade war, was discussed for a long time and was resolved unexpectedly this week: just before the next round of China-US negotiations. The Chinese have significantly tightened control over the turnover of fentanyl and its derivatives – in fact, meeting the demands of the Americans.

In other words, traders once again had the hope of concluding a broad trade deal that would put an end to a trade war and — perhaps — slow the decline of the global economy. This fact weakened anti-risk sentiment and halted the growth of the dollar, which gained momentum last week.

In addition, the single currency is closely monitoring the pound, or rather – for Brexit. Tonight in the British Parliament will be held "signal voting", the results of which will allow understanding – whether soft Brexit is real in principle or not. A considerable number of rumors proliferate around this topic, most of which, surprisingly, is positive. Thus, according to one of the versions, during today's vote, Labor can support the so-called "Single Market Amendment 2.0". This amendment implies a "soft" version of Brexit and implies free movement in the region. If the interests of the Labor Party and the Conservatives converge on this option, then the chances for approval of the transaction will increase significantly in the near future. And although the market is already tired of being disappointed by the British Parliament, optimism over the pound today prevails. Partly due to this factor, the euro is also kept afloat, especially on the background of indecision of dollar bulls.

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Thus, all the factors listed above allow the EUR/USD pair to keep within the 12th figure, thereby maintaining the potential for corrective growth towards the middle line of the Bollinger Bands indicator on the daily chart, which corresponds to 1.1290. The task of the EUR/USD bears has not changed since last week: they need to break through the lower line of the Bollinger Bands (1.1180), thereby entrenched in the 11th figure. Only in this case, it will be possible to talk about a more large-scale movement down to the main support level of 1.10.

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Dollar Advances Following ISM Manufacturing Index, Construction Spending

Trading 01 avr 2019 Commentaire »

After the release of U.S. ISM manufacturing index for March, construction spending for February and business inventories for January at 10:00 am ET Monday, the greenback climbed against its major counterparts.

The greenback was trading at 111.10 against the yen, 0.9971 against the franc, 1.1227 against the euro and 1.3107 against the pound around 10:01 am ET.


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

Trading 01 avr 2019 Commentaire »

U.S. Construction Spending Jumps 1.0% In February


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*U.S. Business Inventories Climb 0.8% In January

Trading 01 avr 2019 Commentaire »

U.S. Business Inventories Climb 0.8% In January


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*ISM U.S. Manufacturing Index Rises To 55.3 In March

Trading 01 avr 2019 Commentaire »

ISM U.S. Manufacturing Index Rises To 55.3 In March


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Dollar At Multi-day Low Vs Franc After Disappointing U.S. Retail Sales Data

Trading 01 avr 2019 Commentaire »

The U.S. dollar declined to a multi-day low against the Swiss franc in the European session on Monday, following a data showing a modest decrease in U.S. retail sales for February.

Data from the Commerce Department showed that 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.

Investors awaited high-level trade talks between the world's two largest economies after Washington remarked that the negotiations 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.

The greenback showed mixed trading against its major counterparts in the Asian session. While it fell against the euro and the pound, it held steady against the franc. Against the yen, it rose.

The greenback that closed Friday's trading at 0.9951 against the franc fell to a 5-day low of 0.9931. Continuation of the greenback's downtrend may take it to a support around the 0.98 mark.

Data from the Federal Statistical Office showed that Switzerland's retail sales fell for the fourth consecutive month in February.

Retail sales fell a calendar-adjusted 0.2 percent year-on-year in February, same as in January. In December, retail sales declined 0.5 percent.

The greenback edged down to 110.81 against the yen, from an early near a 2-week high of 111.19. The greenback is seen challenging support around the 108.00 region.

The U.S. currency remained lower at 1.3113 against the pound, down from last week's closing value of 1.3034. On the downside, 1.33 is likely seen as the next support for the greenback.

Survey data from IHS Markit showed that UK manufacturing sector grew at the fastest pace in over a year in March, as stockpiling by businesses hit a record as they braced for Brexit disruptions.

The CIPS purchasing managers' index, or PMI, for the manufacturing sector climbed to a 13-month high of 55.1 from 52.1 in February. Economists had forecast a score of 51.2.

The greenback fell back to 1.1247 against the euro, not far from a 4-day low of 1.1250 touched at 4:30 am ET. Next key support for the greenback is likely seen around the 1.14 region.

Preliminary data from the statistical office Eurostat showed that Eurozone inflation slowed in March, defying expectations for stability, while the unemployment rate remained unchanged in February.

Headline inflation slowed to 1.4 percent from 1.5 percent in February. Economists had expected the inflation rate to remain unchanged.

The greenback retreated to 0.6836 against the kiwi, a pip short of a 5-day low of 0.6837 seen at 1:45 am ET. If the greenback declines further, 0.70 is likely seen as its next support level.

The greenback pulled back to 0.7129 against the aussie, just few pips short of a 5-day low of 0.7132 hit at 3:30 am ET. The greenback is poised to find support around the 0.73 region.

The greenback slipped to 1.3337 against the loonie, its lowest since March 21. This follows a high of 1.3370 set at 8:30 am ET. The greenback is likely to challenge support around the 1.31 level.

The U.S. ISM manufacturing index for March, construction spending for February and business inventories for January are scheduled for release shortly.


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BITCOIN Analysis for April 1, 2019

Trading 01 avr 2019 Commentaire »

Bitcoin managed to sustain the bullish momentum despite the volatile situation and sudden spikes along the way. The price consolidated for a certain period at around $4,000. However, with strong bearish rejection it managed to set clear momentum with upward pressure.

The price is currently breaching above the recent high of $4,150 and expected to rally higher towards $4,250 resistance area without any further consolidation along the way. The dynamic level of 20 EMA, Tenkan and Kijun line have been carrying the price higher. BTC price is still able to push towards $4,250. The Chikou Span has also cleared above the price line area. BTC is likely to find support along the way and reinforce upward pressure in the market. As for the current price formation, the 3rd Wave formation is on the way and it is expected to reach $4,250 before it consolidates and corrects itself. As the price remains above $4,000, BTC is going to trade under the impulsive bullish momentum.

SUPPORT: 3,800-80, 4,000

RESISTANCE: 4,250, 4,500

BIAS: BULLISH

MOMENTUM: NON-VOLATILE

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Bitcoin analysis for April 01, 2019

Trading 01 avr 2019 Commentaire »

BTC has been trading upwards. The price tested the level of $4.125 with the strong momentum. We expect upward continuation.

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According to the H4 time – frame, we found that there is the successful rejection of the 20-exponential moving average (yellow line), which is sign that buyers supporting the Bitcoin. ADX is reading is about 40 level, which suggests strong trend condition. Resistance levels are seen at the price of $4.159 and $4.212. Short-term support is seen at the price of $4.020.

Trading recommendation: We are still holding long position from $4.070. Now, we moved our SL on breakeven so we got risk free position. Main targets are set at the price of $4.159 and $4.212.

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U.S. Retail Sales Unexpectedly Show Modest Pullback In February

Trading 01 avr 2019 Commentaire »

The Commerce Department released a report on Monday unexpectedly showing a modest decrease in U.S. retail sales in the month of February following a significantly upwardly revised increase in sales in the previous month.

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.

The unexpected drop in retail sales came despite a rebound in sales by motor vehicle and parts dealers, which increased by 0.7 percent in February after plunging by 1.9 percent in January.

Excluding the rebound in auto sales, 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.

Sales by building materials and supplies dealers showed a substantial pullback, nose-diving by 4.4 percent in February after spiking by 4.4 percent in January.

The report also showed notable decreases in sales by miscellaneous store retailers, electronics and appliance stores, and grocery stores, more than offsetting a rebound in sales by gas stations.

Closely watched core retail sales, which exclude autos, gasoline, building materials and food services, edged down by 0.2 percent in February after spiking by an upwardly revised 1.7 percent in January.

Despite the monthly decrease, total retail sales in February were up by 2.2 percent compared to the same month a year ago, although that still reflects a slowdown from the 2.8 percent year-over-year jump in January.


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