Dollar Retreats After Scaling 2-year High

Trading 03 sept 2019 Commentaire »

The U.S. dollar rose to a more than 2-year high on Tuesday amid global economic slowdown and dovish policy stance by most of the central banks across the globe.

The dollar index rose to a high of 99.37, but retreated in mid morning trade after data showed a contraction in U.S. manufacturing activity in the month of August.

The euro, which was trading at $1.0927 early on in the session, recovered to $1.0980 by mid morning before losing some ground and dropping to $1.0966.

Eurozone producer price inflation eased to the lowest since late 2016 in July largely reflecting weak energy prices, data from Eurostat showed Tuesday.

Producer prices grew 0.2% annually in July, as expected, following a 0.7% rise in June. This was the lowest inflation since November 2016, when the rate was 0.1%.

The sterling dropped to a near three-year low to $1.1960 amid political uncertainty in the U.K., but later regained some lost ground and was moving around $1.2080, gaining about 0.12%.

Data from IHS Markit's purchasing managers' survey showed UK construction sector contracted for the fourth consecutive month in August as new work declined the most in over ten years, leading business optimism to plummet to over a decade-low.

The yen was up 0.15%, with a dollar fetching 106.06 yen, as compared to 106.22 yen on Friday. Earlier in the day, the yen had weakened to 106.38.

The dollar was up against the loonie at 1.3339, down 0.6% against the Aussie at 0.6759 after the Australian central bank left its interest rate unchanged.

Against Swiss franc, the dollar was down 0.3% at 0.9876.

A report from the Institute for Supply Management today showed U.S. manufacturing activity contracted for the first time in three years.

The ISM said its purchasing managers index fell to 49.1 in August after dipping to 51.2 in July, with a reading below 50 indicating a contraction in manufacturing activity. Economists had expected the index to edge down to 51.0.

With the bigger than expected decrease, the PMI dropped below 50 for the first time since August of 2016 and hit its lowest level since January of 2016.

Meanwhile, a report released by the Commerce Department showed construction spending in the U.S. inched up by 0.1% to an annual rate of $1.289 trillion in July, after sliding by 0.7% to a revised June rate of $1.288 trillion. Economists had expected construction spending to rise by 0.3% compared to the 1.3% nosedive originally reported for the previous month.

On the trade front, U.S. President Donald Trump indicated U.S. and Chinese officials still plan to meet for trade talks this month but argued the U.S. "can't allow China to rip us off anymore as a country."

In a series of tweets this morning, Trump threatened to get tougher on China if he wins re-election and dismissed suggestions that he work with the European Union to go after Chinese trade practices.


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

Crude Oil Futures Decline Sharply, Settle At 1-week Low

Trading 03 sept 2019 Commentaire »

Crude oil prices declined sharply on Tuesday amid signs of rising OPEC and Russian oil output and on concerns about the outlook for near term energy demand.

Uncertainty about a U.S.-China trade deal and disappointing U.S. manufacturing activity data for the month of August also contributed to oil's decline.

West Texas Intermediate crude oil futures for October ended down $1.16, or 2.1%, at $53.94 a barrel, the lowest close since August 26.

On Friday, WTI crude oil futures ended down $1.61, or about 2.8%, at $55.10 a barrel.

OPEC's output rose last month for the first month this year as higher supply from Iraq and Nigeria outweighed bigger-than-planned cutbacks by the Saudis caused by U.S. sanctions on Iran.

Russia's oil output in August was slightly higher than levels agreed under OPEC+ output deal.

According to the report released by the Institute for Supply Management, U.S. manufacturing activity contracted for the first time in three years in the month of August.

The ISM said its purchasing managers index fell to 49.1 in August after dipping to 51.2 in July, with a reading below 50 indicating a contraction in manufacturing activity. Economists had expected the index to edge down to 51.0.

With the bigger than expected decrease, the PMI dropped below 50 for the first time since August of 2016 and hit its lowest level since January of 2016.

The report also showed an end to a 35-month expansion in production, as the production index dipped to 49.5 in August from 50.8 in July.

Employment in the manufacturing sector also contracted for the first time since September of 2016, with the employment index slumping to 47.4 in August from 51.7 in the previous month.

The new export orders index experienced the biggest loss among the sub-indexes, tumbling to 43.3 in August from 48.1 in July.

Traders now await weekly oil reports from the American Petroleum Institute (API) and U.S. Energy Information Administration (EIA). While API's weekly oil report is due Tuesday evening, the EIA's inventory data is due out at 10.30 am ET on Thursday.


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

Treasuries Move To Upside Following Weak Manufacturing Data

Trading 03 sept 2019 Commentaire »

After initially showing a lack of direction, treasuries showed a strong move to the upside following the release of weak U.S. manufacturing data.

Bond prices gave back some ground over the course of the afternoon but remained firmly positive. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, slid 4 basis points to 1.466 percent.

The ten-year yield hit a three-year intraday low of 1.429 percent shortly after the release of a report from the Institute for Supply Management showing U.S. manufacturing activity contracted for the first time in three years.

The ISM said its purchasing managers index fell to 49.1 in August after dipping to 51.2 in July, with a reading below 50 indicating a contraction in manufacturing activity. Economists had expected the index to edge down to 51.0.

With the bigger than expected decrease, the PMI dropped below 50 for the first time since August of 2016 and hit its lowest level since January of 2016.

"Comments from the panel reflect a notable decrease in business confidence," said Timothy R. Fiore, Chair of the ISM Manufacturing Business Survey Committee.

He added, "August saw the end of the PMI expansion that spanned 35 months, with steady expansion softening over the last four months."

A separate report from the Commerce Department showed construction spending inched up by less than expected in the month of July.

The strength among treasuries also came after new tariffs took effect over the Labor Day weekend in the escalating U.S.-China trade.

The U.S. officially imposed a 15 percent tariff on approximately $112 billion worth of Chinese imports, leading to Chinese retaliatory tariffs on billions of dollars worth of U.S. goods.

President Donald Trump repeated his claim in remarks to reporters on Sunday that China is paying for the tariffs by devaluing their currency.

Trump indicated U.S. and Chinese officials still plan to meet for trade talks this month but argued the U.S. "can't allow China to rip us off anymore as a country."

In a series of tweets this morning, Trump threatened to get tougher on China if he wins re-election and dismissed suggestions that he work with the European Union to go after Chinese trade practices.

Trading on Wednesday may be impacted by reaction to remarks by several Federal Reserve officials as well as the Fed's Beige Book, a compilation of anecdotal evidence on economic conditions in the twelve Fed districts.


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

Gold Futures Settle Sharply Higher On Safe-haven Appeal

Trading 03 sept 2019 Commentaire »

Gold prices surged higher on Tuesday on safe-haven appeal after global stocks drifted lower amid a lack of clarity on resumption of U.S.-China trade talks and due to political uncertainty over Brexit chaos.

Data showing a contraction in U.S. manufacturing activity for the first time in three years and the dollar's retreat from higher levels contributed as well to gold's uptick.

The dollar index, which advanced to 99.37 earlier in the day, eased to 98.93 later on in the session, up just slightly from previous close.

Gold futures for December ended up $26.50, or 1.7%, at $1,555.90 an ounce, their highest settlement since April 2013.

On Friday, gold futures for December ended down $7.50, or 0.5%, at $1,529.40 an ounce, losing ground for a third successive session.

Silver futures for December ended up $0.895, at $19.237 an ounce, while Copper futures for December settled at $2.5280 per pound, down $0.235 from previous close.

In economic news, U.S. manufacturing activity contracted for the first time in three years in the month of August, according to a report released by the Institute for Supply Management on Tuesday.

The ISM said its purchasing managers index fell to 49.1 in August after dipping to 51.2 in July, with a reading below 50 indicating a contraction in manufacturing activity. Economists had expected the index to edge down to 51.0.

With the bigger than expected decrease, the PMI dropped below 50 for the first time since August of 2016 and hit its lowest level since January of 2016.

Meanwhile, a report released by the Commerce Department showed a slight uptick in U.S. construction spending in the month of July following a smaller than previously estimated slump in June.

The Commerce Department said construction spending inched up by 0.1% to an annual rate of $1.289 trillion in July after sliding by 0.7% to a revised June rate of $1.288 trillion.

Economists had expected construction spending to rise by 0.3% compared to the 1.3% nosedive originally reported for the previous month.

On the trade front, China has approached the World Trade Organization after the Trump administration levied an extra 15% tariff on $300 billion worth of Chinese imports from September 1.

China will "firmly safeguard its own legitimate rights and interests and resolutely uphold the multilateral trading system as well as the international trade order in line with WTO rules," the Chinese Ministry of Commerce said.

Meanwhile, in Brexit news, the U.K. Prime Minister Boris Johnson today lost his majority in Parliament as conservative lawmaker Phillip Lee defected to the pro-European Liberal Democrat party. Lee said Johnson was ignoring expert advice on Brexit.


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

September 3, 2019 : EUR/USD Intraday technical analysis and trade recommendations.

Trading 03 sept 2019 Commentaire »

analytics5d6e90471713c.jpg

Back in June 24, the EURUSD looked overbought around 1.1400 facing a confluence of supply levels which generated significant bearish pressure over the pair.

Shortly after, In the period between 8 - 22 July, a sideway consolidation-range was established between 1.1200 - 1.1275 until a triple-top reversal pattern was demonstrated around the upper limit.

Then, Evident bearish momentum (bearish engulfing H4 candlestick) could bring the EURUSD below 1.1175.

This facilitated further bearish decline towards 1.1115 (Previous Weekly Low) then 1.1025 (the lower limit of the depicted recent bearish channel) where significant signs of bullish recovery were demonstrated.

Shortly-After in Mid-August, the EUR/USD has been trapped between 1.1235-1.1175 for a few trading sessions until bearish breakout below 1.1175 occurred on August 14.

Bearish breakout below 1.1175 promoted further bearish decline towards 1.1075 where the backside of the broken bearish channel has provided temporary bullish demand for sometime (Bullish Triple-Bottom pattern).

Bullish persistence above 1.1115 was needed to confirm the short-term trend reversal into bullish.

However, the depicted Triple-Bottom pattern was invalidated especially after the EURUSD pair bulls have failed to establish Bullish persistence above 1.1115.

Moreover, the recently established short-term uptrend line has been invalidated as well. This turned the short-term outlook as bearish.

By the end of last week's consolidations, a quick bearish decline was demonstrated towards 1.0980-1.0965 where the backside of the broken channel comes to meet the EURUSD pair again.

Trade recommendations :

Risky traders were advised to look for a valid BUY entry anywhere around the current price levels of 1.0950. T/p levels to be located around 1.1015 and 1.1050.

Conservative traders should wait for bullish pullback towards 1.1050-1.1070 for a valid SELL entry. S/L should be placed just above 1.1095 while target levels can be determined later based on upcoming price action.

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

September 3, 2019 : GBP/USD Intraday technical analysis and trade recommendations.

Trading 03 sept 2019 Commentaire »

analytics5d6e8d331801b.jpg

On July 5, a consolidation range bearish breakout was demonstrated below 1.2550 corresponding to the lower limit of the depicted consolidation range.

Moreover, Bearish breakdown below 1.2385 (Broken Key-Support) facilitated further bearish decline towards 1.2320, 1.2210 and 1.2100 which corresponded to significant key-levels on the Weekly chart.

In Early August, another consolidation-range was temporarily established above 1.2100 before August 9 when temporary bearish movement was executed towards 1.2025.

Recent bullish recovery was demonstrated off the recent bottom (1.2025).

This brought the GBP/USD pair back above 1.2100 (Lower limit of the recently established consolidation-zone).

As expected, further bullish advancement was demonstrated towards 1.2230 then 1.2280 where recent bearish rejection was demonstrated.

Bullish persistence above 1.2160 (the recent consolidation range pivot-point) was needed to enhance further bullish advancement towards 1.2320 then 1.2380.

However, recent bearish rejection was demonstrated around 1.2215 (backside of the depicted broken uptrend line).

That's why, another quick bearish decline took place towards 1.2100 then 1.2000 (corresponding to a prominent bottom established on August 9).

Today, early signs of bullish recovery (Bullish Engulfing candlesticks) were manifested around 1.1960 bringing the GBPUSD back towards 1.2100.

Trade Recommendations:

Conservative traders are advised to wait for the current bullish pullback to pursue towards 1.2160 (backside of the depicted broken uptrend) for a valid SELL entry.

T/P level to be placed around 1.2100 and 1.2020, while S/L should be placed above 1.2220.

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

U.S. Construction Spending Inches Less Than Expected In July

Trading 03 sept 2019 Commentaire »

A report released by the Commerce Department on Tuesday showed a slight uptick in U.S. construction spending in the month of July following a smaller than previously estimated slump in June.

The Commerce Department said construction spending inched up by 0.1 percent to an annual rate of $1.289 trillion in July after sliding by 0.7 percent to a revised June rate of $1.288 trillion.

Economists had expected construction spending to rise by 0.3 percent compared to the 1.3 percent nosedive originally reported for the previous month.

The uptick in construction spending came as an increase in spending on public construction was partly offset by a dip in spending on private construction.

The report said spending on public construction climbed by 0.4 percent to an annual rate of $325.7 billion, as spending on education construction surged up by 1.6 percent.

On the other hand, spending on private construction edged down by 0.1 percent to a rate of $963.1 billion, with a 0.6 percent increase in spending on residential construction more than offset by a 0.8 percent drop in spending on non-residential construction.

Compared to the same month a year ago, construction spending in July was down by 2.7 percent, as a 4.8 percent slump in spending on private construction more than offset a 4.0 percent jump in spending on public construction.


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

Nigeria Economic Growth Slows For Second Consecutive Quarter

Trading 03 sept 2019 Commentaire »

Nigeria's economic growth slowed for a second quarter in a row in the three months to June, figures from the National Bureau of Statistics showed on Tuesday.

Gross domestic product grew 1.94 percent year-on-year after a 2.10 percent increase in the first quarter, which was revised from 2.01 percent due to oil output revisions. In the fourth quarter of 2018, the economy grew 2.38 percent.

Stability in oil output as well as the successful political transition supported second quarter growth, the agency said.

The oil sector grew 5.15 percent year-on-year in the second quarter after a revised 6.61 percent expansion in the previous three months. The sector's contribution to total real GDP eased to 8.82 percent.

The non-oil sector growth slowed to 1.64 percent in the second quarter, but the contribution to GDP rose to 91.18 percent from 90.78 percent in the previous quarter.

In the first half of 2019, the economy grew 2.02 percent versus 1.69 percent in the same period last year.


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

U.S. Manufacturing Activity Contracts For First Time In Three Years

Trading 03 sept 2019 Commentaire »

U.S. manufacturing activity contracted for the first time in three years in the month of August, according to a report released by the Institute for Supply Management on Tuesday.

The ISM said its purchasing managers index fell to 49.1 in August after dipping to 51.2 in July, with a reading below 50 indicating a contraction in manufacturing activity. Economists had expected the index to edge down to 51.0.

With the bigger than expected decrease, the PMI dropped below 50 for the first time since August of 2016 and hit its lowest level since January of 2016.

"Comments from the panel reflect a notable decrease in business confidence," said Timothy R. Fiore, Chair of the ISM Manufacturing Business Survey Committee.

He added, "August saw the end of the PMI expansion that spanned 35 months, with steady expansion softening over the last four months."

The drop by the headline index came as customer demand contracted for the first time since December of 2015, with the new orders index sliding to 47.2 in August from 50.8 in July.

The report also showed an end to a 35-month expansion in production, as the production index dipped to 49.5 in August from 50.8 in July.

Employment in the manufacturing sector also contracted for the first time since September of 2016, with the employment index slumping to 47.4 in August from 51.7 in the previous month.

The new export orders index experienced the biggest loss among the subindexes, tumbling to 43.3 in August from 48.1 in July.

"Respondents expressed slightly more concern about U.S.-China trade turbulence, but trade remains the most significant issue, indicated by the strong contraction in new export orders," said Fiore.

"Respondents continued to note supply chain adjustments as a result of moving manufacturing from China," he added. "Overall, sentiment this month declined and reached its lowest level in 2019."

On the inflation front, the prices index inched up to 46.0 in August from 45.1 in July, although the reading below 50 still indicates prices contracted for the third straight month.

The ISM is scheduled to release a separate report on service sector activity in the month of August on Thursday. The index of activity in the sector is expected to tick up to 53.9 in August from 53.7 in July.


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

*ISM U.S. Manufacturing Index Drops To 49.1 In August

Trading 03 sept 2019 Commentaire »

ISM U.S. Manufacturing Index Drops To 49.1 In August


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