Dollar Fails To Hold Early Gains, Turns Weak Against Most Rivals

Trading 04 oct 2019 Commentaire »

After initial weakness on Friday, the U.S. dollar rallied well, riding on mixed jobs data that showed fewer additions in employment in September, but the jobless rate dropped. However, the currency retreated by mid morning, weighed down by trade and political uncertainty.

The U.S. Labor Department's jobs report showed weaker than expected job growth in September, while the unemployment rate unexpectedly dropped to a nearly 50-year low.

The report said non-farm payroll employment rose by 136,000 jobs in September compared to economist estimates for an increase of about 145,000 jobs.

Meanwhile, the increases in employment in July and August were upwardly revised to 166,000 jobs and 168,000 jobs, respectively, reflecting the addition of 45,000 more jobs than previously reported.

The average monthly job growth has still slowed from 223,000 jobs per month in 2018 to 161,000 jobs per month so far in 2019.

The Labor Department also said the unemployment rate fell to 3.5% in September from 3.7% in August, dropping to its lowest level since hitting a matching rate in December of 1969.

The dollar index, which rallied to 99.0 from a low of 98.74, failed to sustain at higher levels and dropped to 98.81 later on in the day.

Against the euro, the dollar was down 0.13% at 1.0979, after having strengthened to 1.0958 soon after the release of the jobs data. A positive report on Germany's construction sector supported the euro.

Germany's construction sector expanded modestly in September, led by a growth in housing activity that offset slower declines in commercial and civil engineering, survey data from IHS Markit showed on Friday.

The construction purchasing managers' index, or PMI, rose to 50.1 in September from August's 62-month low of 46.3. Any reading above 50 indicates expansion in the sector.

The pound sterling was up marginally against the greenback at $1.2334, after having weakened to $1.2276 earlier in the day. The sterling's earlier weakness was due the survey results from the British Chambers of Commerce that said the UK economic conditions weakened in the third quarter due to a marked deterioration in manufacturing sector activity.

Against the Japanese currency, the dollar was little changed at 106.89 yen by late afternoon, dropping from the day's high of 107.12 yen a dollar.

Against the loonie, the dollar was down 0.17% at 1.3315, with data on Canada's trade balance lifting the Canadian currency.

Against Swiss franc and the Aussie, the dollar was down notably at 0.9951 and 0.6766, respectively.


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Treasuries Extend Recent Upward Trend Following Jobs Report

Trading 04 oct 2019 Commentaire »

Extending the upward trend seen over the past few sessions, treasuries moved modestly higher during trading on Friday.

Bond prices moved to the upside in morning trading and remained positive for the remainder of the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 2.1 basis points to 1.515 percent.

The continued strength among treasuries came following the release of a report from the Labor Department showing weaker than expected job growth in the month of September.

The report said non-farm payroll employment rose by 136,000 jobs in September compared to economist estimates for an increase of about 145,000 jobs.

Meanwhile, the increases in employment in July and August were upwardly revised to 166,000 jobs and 168,000 jobs, respectively, reflecting the addition of 45,000 more jobs than previously reported.

The average monthly job growth has still slowed from 223,000 jobs per month in 2018 to 161,000 jobs per month so far in 2019.

The Labor Department also said the unemployment rate fell to 3.5 percent in September from 3.7 percent in August. Economists had expected to unemployment rate to remain unchanged.

With the unexpected decrease, the unemployment rate dropped to its lowest level since hitting a matching rate in December of 1969.

The unexpected drop in the unemployment rate came as a 391,000-person jump in the household survey measure of employment more than offset an 117,000-person increase in the size of the labor force.

Even with the unemployment rate hitting a nearly 50-year low, the report said average hourly employee earnings edged down by a penny to $28.09 in September after rising by 11 cents in August.

Compared to the same month a year ago, average hourly earnings were up by 2.9 percent in September, reflecting a notable slowdown from the 3.2 percent increase in August.

Citing headwinds from weaker global growth, trade uncertainty and the strong U.S. dollar, ING Chief International Economist James Knightley expects job growth to average closer to 120,000 for the rest of the year.

"This suggests pay growth is unlikely to accelerate markedly from here and with inflation picking up, the real wage growth story may not be as positive for spending power," Knightley said. "All in all, it looks as though the Fed will need to step in with more policy easing to support the economy."

Reports on producer and consumer price inflation are likely to attract attention next week along with the minutes of the Federal Reserve's latest monetary policy meeting.

Bond traders are also likely to keep an eye on the results of the Treasury Department's auctions of three-year and ten-year notes and thirty-year bonds.


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Oil Futures Snap 8-day Losing Streak, Settle Modestly Higher

Trading 04 oct 2019 Commentaire »

Crude oil prices moved higher on Friday and snapped an eight-session losing streak, after fairly decent monthly jobs data from the U.S. Labor Department eased concerns about growth in the world's largest economy and the outlook for energy demand.

However, crude's upside was not any significantly sharp as Saudi Arabia said it has fully restored its oil production following the attacks on its oil facilities in mid-September.

West Texas Intermediate Crude oil futures for November ended up $0.36, or about 0.7%, at $52.81 a barrel.

On Thursday, WTI crude oil futures for November ended down $0.19, or about 0.4%, at $52.45 a barrel, the lowest settlement in nearly two months.

For the week, crude oil futures shed about 5.5%, posting their second straight weekly loss.

According to a report from Baker Hughes, oil rig count fell for the sixth straight week, with the number of active U.S. rigs drilling for oil dropped by three to 710 this week. The total active rig count fell by five to 855, the report said.

In a speech during a plenary session at Russian Energy Week in Moscow, Saudi Arabia's Energy Minister Prince Abdulaziz bin Salman said the kingdom's oil production capacity now stands at 11.3 million barrels per day (mbpd).

The U.S. Labor Department's jobs report showed weaker than expected job growth in September. However, the unemployment rate unexpectedly dropped to a nearly 50-year low.

The report said non-farm payroll employment rose by 136,000 jobs in September compared to economist estimates for an increase of about 145,000 jobs.

Meanwhile, the increases in employment in July and August were upwardly revised to 166,000 jobs and 168,000 jobs, respectively, reflecting the addition of 45,000 more jobs than previously reported.

The average monthly job growth has still slowed from 223,000 jobs per month in 2018 to 161,000 jobs per month so far in 2019.

The Labor Department also said the unemployment rate fell to 3.5% in September from 3.7% in August, dropping to its lowest level since hitting a matching rate in December of 1969.

Investors are eagerly awaiting next week's U.S.-China trade talks for any signs of a breakthrough on a trade deal.


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Gold Futures Settle Slightly Weak

Trading 04 oct 2019 Commentaire »

Gold prices settled slightly lower on Friday as traders chose to pick up riskier assets such as equities after the mixed jobs data from the U.S. Labor Department raised prospects for a rate cut by the Federal Reserve and helped ease fears of a recession as well.

The dollar was quite sluggish, swinging between gains and losses in a narrow range. It was seen hovering around 98.80 in early afternoon trades, down 0.06% from previous close.

Gold futures for December ended down $0.90, or nearly 0.1%, at $1,512.90 an ounce, after having eased to $1,501.40 in morning trades.

On Thursday, gold futures for December up $5.90, or about 0.4%, at $1,513.80 an ounce.

For the week, gold futures gained about 0.4%.

Silver futures for December ended down $0.051, at $17.625 an ounce, while Copper futures for December settled higher by $0.0090, at $2.5625 per pound.

The U.S. Labor Department's jobs report showed weaker than expected job growth in September, while the unemployment rate unexpectedly dropped to a nearly 50-year low.

The report said non-farm payroll employment rose by 136,000 jobs in September compared to economist estimates for an increase of about 145,000 jobs.

Meanwhile, the increases in employment in July and August were upwardly revised to 166,000 jobs and 168,000 jobs, respectively, reflecting the addition of 45,000 more jobs than previously reported.

The average monthly job growth has still slowed from 223,000 jobs per month in 2018 to 161,000 jobs per month so far in 2019.

The Labor Department also said the unemployment rate fell to 3.5% in September from 3.7% in August, dropping to its lowest level since hitting a matching rate in December of 1969.


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

Dollar Rebounds After U.S. Jobs Data

Trading 04 oct 2019 Commentaire »

The U.S. dollar rebounded from its recent lows against its most major counterparts in the European session on Friday, after the release of mixed jobs data that showed the economy created fewer jobs than expected in September, but the jobless rate dropped.

Data from the Labor Department showed that U.S. employment increased less than expected in the month of September.

The report said non-farm payroll employment rose by 136,000 jobs in September compared to economist estimates for an increase of about 145,000 jobs.

Meanwhile, the increases in employment in July and August were upwardly revised to 166,000 jobs and 168,000 jobs, respectively, reflecting the addition of 45,000 more jobs than previously reported.

The Labor Department also said the unemployment rate fell to 3.5 percent in September from 3.7 percent in August. Economists had expected to unemployment rate to remain unchanged.

Data from the Commerce Department showed that the U.S. trade deficit widened more than anticipated in August.

The report said the trade deficit widened to $54.9 billion in August from $54.0 billion in July. Economists had expected the trade deficit to widen to $54.5 billion.

Recent data on manufacturing and services came in well below expectations, fueling concerns over a significant slowdown in economy.

Market participants widely expect the Federal Reserve to cut interest rates at its upcoming meeting on October 30.

The currency dropped against its major rivals in the previous session, excepting the franc.

The greenback recovered to 1.0957 against the euro, from a low of 1.0997 hit at 8:30 am ET. The greenback is seen finding resistance around the 1.06 level.

Survey data from IHS Markit showed that Germany's construction sector expanded modestly in September, led by a growth in housing activity that offset slower declines in commercial and civil engineering.

The construction purchasing managers' index, or PMI, rose to 50.1 in September from August's 62-month low of 46.3. Any reading above 50 indicates expansion in the sector.

Reversing from a low of 1.2357 touched at 10:15 pm ET, the greenback appreciated to 1.2279 against the pound. The next possible resistance for the greenback is seen around the 1.21 level.

The greenback reached as high as 107.13 against the yen, following a decline to 106.56 at 8:30 am ET. Next immediate resistance for the greenback is seen around the 109.00 level.

Following a 9-day decline to 0.6337 against the kiwi at 8:30 am ET, the greenback bounced off to 0.6307 immediately. Should the greenback rises further, it may find resistance around the 0.61 level.

In contrast, the greenback fell to a 2-day low of 0.9925 against the franc, compared to 0.9987 hit late New York Thursday. On the downside, 0.97 is possibly seen as the next support level for the greenback.

The greenback declined to a 2-day low of 1.3297 against the loonie from Thursday's closing value of 1.3334. The currency is likely to locate support around the 1.30 level.

Though the greenback recovered from data-led decline against the aussie, it was short-lived. The greenback was trading at 0.6762 versus the aussie, near a 3-day low of 0.6766 hit at 8:30 am ET. The currency may locate support around the 0.71 mark, if it weakens further.

Data from the Australian Bureau of Statistics showed that Australia's retail sales increased in August.

Retail sales advanced 0.4 percent on month, following a flat growth a month ago. This was the fastest growth in four months. However, the pace of growth was slightly slower than the expected 0.5 percent.

Looking ahead, Canada Ivey PMI for September will be released shortly.

Fed Chairman Jerome Powell will deliver a speech in Washington at 2:00 pm ET.


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BTC 10.04.2019 – Sell zone for Bitcoin, bearish flag in creation

Trading 04 oct 2019 Commentaire »

BTC has been trading downside as we expected yesterday. Our yesterday's target at $8,046 has been met. Most recently, I found that bearish flag is in creation based on the 1H time-frame.

analytics5d975e9968d03.jpg

Purple lines – Bear flag

Purple falling line – Expected path

Green rectangle – Important support

My advice is to watch for selling opportunities on the BTC since it is still in the downtrend. The downward channel is active and there is more chance for downside. Potential downward targets are set at the price of $8,046 and $7,755.

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

U.S. Trade Deficit Widens More Than Expected To $54.9 Billion In August

Trading 04 oct 2019 Commentaire »

With the value of imports rising by more than the value of exports, the Commerce Department released a report on Friday showing the U.S. trade deficit widened by more than anticipated in the month of August.

The report said the trade deficit widened to $54.9 billion in August from $54.0 billion in July, while economists had expected the trade deficit to widen to $54.5 billion.

The wider trade deficit came as the value of imports climbed by 0.5 percent to $262.8 billion in August after edging down to $261.4 billion in July.

Significant increases in imports of cell phones and other household goods, semiconductors, and other industrial machines were partly offset by a steep drop in imports of industrial supplies and materials.

Meanwhile, the report said the value of exports rose by 0.2 percent to $207.9 billion in August after climbing to $207.4 billion in July.

Exports of fuel oil, non-monetary gold, and soybeans saw notable growth, although exports of civilian aircraft showed a steep drop.

"In real terms, exports and imports are both on course for growth of around 4% annualized in the third quarter, stronger than we had assumed," said Paul Ashworth, Chief U.S. Economist at Capital Economics.

He added, "But that would still make net trade a small drag on third-quarter GDP growth, which we expect to come in at 1.5% annualized, and the darkening global backdrop suggests that drag will continue into the fourth quarter."

The Commerce Department also said the goods deficit widened to $74.4 billion in August from $73.6 billion in July, while the services surplus slipped to $19.5 billion from $19.6 billion.


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

U.S. Unemployment Rate Hits Nearly 50-Year Low Despite Slowing Job Growth

Trading 04 oct 2019 Commentaire »

A closely watched report released by the Labor Department on Friday showed U.S. employment increased by less than expected in the month of September, although the report also showed the unemployment rate unexpectedly dropped to a nearly 50-year low.

The report said non-farm payroll employment rose by 136,000 jobs in September compared to economist estimates for an increase of about 145,000 jobs.

The Labor Department said employment in healthcare and professional and business services continued to trend up, while the manufacturing sector lost 2,000 jobs amid the strike at General Motors (GM).

Meanwhile, the increases in employment in July and August were upwardly revised to 166,000 jobs and 168,000 jobs, respectively, reflecting the addition of 45,000 more jobs than previously reported.

The average monthly job growth has still slowed from 223,000 jobs per month in 2018 to 161,000 jobs per month so far in 2019.

The Labor Department also said the unemployment rate fell to 3.5 percent in September from 3.7 percent in August. Economists had expected to unemployment rate to remain unchanged.

With the unexpected decrease, the unemployment rate dropped to its lowest level since hitting a matching rate in December of 1969.

The unexpected drop in the unemployment rate came as a 391,000-person jump in the household survey measure of employment more than offset an 117,000-person increase in the size of the labor force.

Even with the unemployment rate hitting a nearly 50-year low, the report said average hourly employee earnings edged down by a penny to $28.09 in September after rising by 11 cents in August.

Compared to the same month a year ago, average hourly earnings were up by 2.9 percent in September, reflecting a notable slowdown from the 3.2 percent increase in August.

Citing headwinds from weaker global growth, trade uncertainty and the strong U.S. dollar, ING Chief International Economist James Knightley expects job growth to average closer to 120,000 for the rest of the year.

"This suggests pay growth is unlikely to accelerate markedly from here and with inflation picking up, the real wage growth story may not be as positive for spending power," Knightley said.

He added, "All in all, it looks as though the Fed will need to step in with more policy easing to support the economy."


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

Tariffs To Hurt Half Of Dutch Cheese Exports To U.S.

Trading 04 oct 2019 Commentaire »

Tariffs on imports announced by the US President Donald Trump is set to affect nearly half of Dutch cheese exports to the country, the Dutch Trade Ministry said Friday.

The Trump administration has threatened to slap a 25 percent tariff on European food product imports.

The Netherlands exported EUR 80 million worth of cheese to the US last year. Some varieties of Dutch cheese such as the Gouda and Edam, are excluded from tariffs.

Thus, around EUR 39 million worth of Dutch cheese exports, which include processed products, to the US will be hit with the 25 percent tariff.


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

October 4, 2019 : GBP/USD Intraday technical outlook and trade recommendations.

Trading 04 oct 2019 Commentaire »

analytics5d975c3e1fdac.jpg

Since August 9, the GBP/USD pair has been trending-up within the depicted bullish channel except on September 3 when a temporary bearish breakout was demonstrated towards 1.1960.

Around the price level of 1.1960, aggressive signs of bullish recovery (Bullish Engulfing candlesticks) brought the GBPUSD back above 1.2230 where the pair looked overbought.

However, further bullish momentum was demonstrated towards 1.2320 maintaining the bullish movement inside the depicted movement channel.

Moreover, Temporary bullish advancement was demonstrated towards 1.2550 where a reversal wedge pattern was established.

As anticipated, the reversal wedge pattern was confirmed Last week on Monday's consolidations supported by obvious bearish price action demonstrating a successful bearish closure below 1.2450.

On September 24, the backside of the confirmed reversal wedge was successfully re-tested around 1.2500 where a new episode of bearish rejection was expressed.

The Long-term outlook remains bearish as long as the most recent top established around 1.2500 remains defended by the GBP/USD bears.

Moreover, the recent bullish channel (established on August 9) has been invalidated on September 25. Thus, the short-term outlook turned into bearish as well.

Bearish persistence below 1.2400-1.2440 (Reversal-Pattern Neckline) allowed more bearish decline to occur towards the price levels of 1.2210 where the previous bullish pullback towards 1.2400 was originated on Tuesday.

Today, bearish persistence below 1.2220 is mandatory to allow further bearish decline towards 1.2160 and 1.2120.

Trade Recommendations:

Conservative traders were advised to consider the recent bullish pullback towards the neckline of the confirmed Head & Shoulders reversal pattern (Anywhere around 1.2400-1.2450) as a valid SELL entry. It's already running in profits.

Remaining T/P levels to be placed around 1.2280, 1.2240 and 1.2160 while S/L should be lowered to 1.2370 to offset the associated risks.

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