Gold price has formed important medium-term bottom

Trading 04 mar 2020 Commentaire »

Gold price broke above the $1,610-15 resistance area and is now very close to its 2020 highs. Short-term trend is bullish. Price remains inside the longer-term channel and as long as price is above $1,586 I do not expect to see any major pull back.

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Red lines - bullish channel

Gold price is at $1,638 after a strong day yesterday where price started to rise from $1,588. Another pull back towards $1,600 is not out of the question and I believe it is justified. However I would prefer to be neutral rather than bearish at current levels as price seems to have formed a medium-term bottom at $1,562-86 area.

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In Ichimoku cloud terms, Gold price is trying to break out of the 4hour cloud resistance. Support is at $1,634, next at $1,626 and finally at $1,611. Resistance is at $1,650. If bulls manage to break above $1,650 and hold it, then we should expect new 2020 highs.The material has been provided by InstaForex Company - www.instaforex.com

Short-term technical analysis on EURUSD

Trading 04 mar 2020 Commentaire »

EURUSD has reached the upper channel boundary and has stopped its sharp rise. Price is now trading around the 1.1130 resistance area and as we explained in our previous analysis, this is important resistance.

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Red lines - bearish channel

EURUSD is showing rejection signs. Price has reached our second target since this analysis was posted back on February 25th and when price was trading around 1.0850. With the RSI in the Daily chart at overbought levels, bulls need to be cautious and raise their protective stops. Holding above 1.11 will be a sign of strength and could lead to a new higher high towards 1.12.

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*U.S. Crude Oil Inventories Rise By 800,000 Barrels In Week Ended 2/28

Trading 04 mar 2020 Commentaire »

U.S. Crude Oil Inventories Rise By 800,000 Barrels In Week Ended 2/28


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U.S. Service Sector Growth Unexpectedly Accelerates To One-Year High

Trading 04 mar 2020 Commentaire »

Partly reflecting a notable acceleration in the pace of growth in demand, the Institute for Supply Management released a report on Wednesday showing activity in the U.S. service sector unexpectedly grew at a faster rate in the month of February.

The ISM said its non-manufacturing index climbed to 57.3 in February from 55.5 in January, with a reading above 50 indicating growth in service sector activity.

The increase by the reading on service sector activity came as a surprise to economists, who had expected the index to edge down to 54.9.

With the unexpected uptick, the non-manufacturing index reached its highest level since hitting 58.5 in February of 2019.

The advance by the headline index came as the new orders index surged up to 63.1 in February from 56.2 in January, reaching its highest level since June of 2018.

The employment index also rose to 55.6 in February from 53.1 in January, indicating a faster rate of job growth in the service sector.

On the other hand, the report said the business activity index fell to 57.8 in February after jumping to 60.9 in the previous month.

The prices index also tumbled to 50.8 in February from 55.5 in January, pointing to a notable slowdown in the pace of price growth.

Anthony Nieves, Chair of the ISM Non-Manufacturing Business Survey Committee, said the service sector saw continued growth in February but noted most respondents are concerned about the coronavirus and its supply chain impact.

"They also continue to have difficulty with labor resources," Nieves said. "They do remain positive about business conditions and the overall economy."

A separate report released by the ISM on Monday showed U.S. manufacturing activity saw a slight expansion in the month of February.

The ISM said its purchasing managers index edged down to 50.1 in February from 50.9 in January, while economists had expected the index to dip to 50.5.


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IMF's Georgieva Says Global Growth To Be Deep Below 2019 Level On COVID-19

Trading 04 mar 2020 Commentaire »

Global growth this year would be much lower than 2019 level as the coronavirus, or COVID-19, spreads to several countries hurting economic activity, International Monetary Fund Managing Director Kristalina Georgieva said Wednesday. "Under any scenario, global growth in 2020 will fall below last year's level," Georgieva said during a press briefing, where she was joined by World Bank Group President David Malpass.

"How far it will fall, and for how long, will depend on the coronavirus epidemic, but also on the quality, timeliness, and effectiveness of policy actions," she added.

Georgieva said there has been a shift to a more adverse scenario for the global economy last week. The new projections will be presented in the latest update to the World Economic Outlook over the coming weeks, she said. In the January update to the World Economic Outlook, the IMF had projected global growth to improve to 3.3 percent this year from 2.9 percent last year.

The economic shock caused by the COVID-19 outbreak is "unusual" as it affects both supply and demand, Georgieva said. The IMF could quickly disburse $50 billion through its emergency financing facilities to low income and emerging markets countries that do not require full-fledged rescue measures, she added.

Late Tuesday, the World Bank announced an aid of up to $12 billion as immediate support for countries to respond to the virus outbreak. The package will include emergency financing, policy advice, and technical assistance, Malpass reiterated.

Earlier on Wednesday, the International Monetary and Financial Committee said after a conference call that the 189 member countries of the IMF are determined to provide the necessary support to mitigate the impact, especially on the most vulnerable people and countries.

The parent organization of IMF called upon the lender to use all its available financing instruments to help member countries in need. "We are confident that, working together, we will overcome the challenge facing us and restore growth and prosperity for all," the IMFC said in a statement.

In other developments, the IMF and the World Bank decided on Tuesday that the 2020 Spring Meetings, scheduled for April, will be held virtually to ensure the health and safety of participants and staff due to the fears around the COVID-19.


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*Canadian Dollar At 2-day Low Of 1.3406 Against U.S. Dollar After BoC Rate Cut

Trading 04 mar 2020 Commentaire »

Canadian Dollar At 2-day Low Of 1.3406 Against U.S. Dollar After BoC Rate Cut


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*Canadian Dollar Declines To 5-month Low Of 79.83 Against Yen

Trading 04 mar 2020 Commentaire »

Canadian Dollar Declines To 5-month Low Of 79.83 Against Yen


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Loonie Falls After BoC Decision

Trading 04 mar 2020 Commentaire »

At 10:00 am ET Wednesday, the Bank of Canada reduced the benchmark rate to 1.25 percent from 1.75 percent. After the decision, the loonie dropped against its major rivals.

The loonie was trading at 1.3374 against the greenback, 1.4856 against the euro, 0.8850 against the aussie and 80.12 against the yen around 10:03 am ET.


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*ISM U.S. Non-Manufacturing Index Climbs To 57.3 In February

Trading 04 mar 2020 Commentaire »

ISM U.S. Non-Manufacturing Index Climbs To 57.3 In February


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*Bank Of Canada Lowers Overnight Rate Target To 1.25%

Trading 04 mar 2020 Commentaire »

Bank Of Canada Lowers Overnight Rate Target To 1.25%


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