Dollar Advances After U.S. Jobs Data

Trading 07 août 2020 Commentaire »

Following the release of the U.S Labor Department's non-farm payrolls data for July at 8:30 am ET Friday, the greenback strengthened against its major counterparts.

The greenback was trading at 105.69 against the yen, 0.9137 against the franc, 1.1822 against the euro and 1.3088 against the pound around 8:31 am ET.


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Loonie Strengthens After Canada Jobs Data

Trading 07 août 2020 Commentaire »

Statistics Canada has released Canada jobs data for July at 8:30 am ET Friday.

The loonie rose against its major counterparts following the data.

The loonie was trading at 0.9615 against the aussie, 79.27 against the yen, 1.5764 against the euro and 1.3333 against the greenback around 8:33 am ET.


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Italy Trade Surplus Fall In June

Trading 07 août 2020 Commentaire »

Italy's trade surplus decreased in June, amid a fall in exports and imports, data from the statistical office Istat showed on Friday.

The trade surplus decreased to EUR 6.23 billion in June from EUR 5.70 billion in the same period last year. In May, the trade surplus was EUR 5.58 billion.

Exports decreased 12.1 percent year-on-year in June, following a 30.4 percent fall in May.

On an annual basis, imports fell 15.6 percent in June, following a 35.2 percent decrease in the preceding month.

On a seasonally adjusted basis, exports rose 14.4 percent and imports increased 16.1 percent monthly.


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Loonie Rises Vs Most Majors Ahead Of Canada Jobs Data

Trading 07 août 2020 Commentaire »

Statistics Canada will publish Canada jobs data for July at 8:30 am ET Friday.

The loonie traded mixed against its major counterparts ahead of the data. While the loonie held steady against the greenback, it strengthened against the rest of major counterparts.

The loonie was worth 0.9619 against the aussie, 79.16 against the yen, 1.5780 against the euro and 1.3351 against the greenback as of 8:25 am ET.


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Dollar Mixed Ahead Of U.S. Jobs Data

Trading 07 août 2020 Commentaire »

At 8:30 am ET Friday, the U.S Labor Department will release non-farm payrolls data for July.

Ahead of the data, the greenback traded mixed against its major counterparts. While the greenback rose against the franc and the pound, it was steady versus the yen and the euro.

The greenback was worth 105.69 against the yen, 0.9143 against the franc, 1.1815 against the euro and 1.3076 against the pound as of 8:25 am ET.


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Lithuania Trade Deficit Narrows In June

Trading 07 août 2020 Commentaire »

Lithuania trade deficit in June decreased from a year ago, as exports and imports declined, figures from the statistical office showed on Friday.

Trade deficit narrowed to EUR 49.2 million in June from EUR 127.3 million in the same month last year. In May, the trade surplus was EUR 5.3 million.

Exports fell 7.6 percent year-on-year in June, following a 21.2 percent decline in the previous month.

Imports declined 10.4 percent annually in June, following a 34.0 percent fall in the prior month.

On a monthly basis, exports rose 11.7 percent in June and import increased 14.5 percent.

In the second quarter, the trade deficit was EUR 14.1 million. Exports and imports declined 16.4 percent and 24.8 percent, respectively.


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Finland Trade Balance Swings To Deficit In June

Trading 07 août 2020 Commentaire »

Finland's trade balance swung to a deficit in June, preliminary figures from the Finnish Customs showed on Friday.

The trade balance registered a deficit of EUR 205 million in June from EUR 75 million surplus in the same month last year. In May, the trade deficit was EUR 285 million.

Exports declined 15.4 percent year-on-year in June and imports fell 10.2 percent.

Exports to the EU countries decreased 14.1 percent in June and imports from EU countries fell 7.9 percent. Shipments to countries outside the EU decreased 16.9 percent and imports from those countries declined 13.6 percent.

For the January-May period, the trade deficit was EUR 1.7 billion compared to a EUR 5 million shortfall registered a year ago. Exports declined 17.4 percent and imports decreased 12.3 percent.


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Taiwan Trade Surplus Rise In July

Trading 07 août 2020 Commentaire »

Taiwan's trade surplus increased in July as exports rose and imports declined, figures from the Ministry of Finance showed on Friday.

The trade surplus decreased to $5.369 billion in July from $3.608 billion last year. Economists had expected a surplus of $4.28 billion. In June, the trade surplus was $4.83 billion.

Exports rose 0.4 percent year-on-year in July, after a 3.8 percent fall in June. Economists had expected a decline of 0.2 percent.

Imports fell 6.8 percent annually in July, following a 8.6 decrease in the preceding month. Economists had forecast a fall of 3.1 percent.

Exports of parts of electronic products, information, communication and audio-video products grew in July, while exports of base metals and articles of base metal, machinery, plastics and rubber, and articles thereof declined.

Imports of parts of electronic product, machinery, and information, communication and audio-video products gained in July, while imports of mineral products and chemicals decreased.

Exports to Mainland China and Hong Kong and U.S.A. increased, while shipments to ASEAN, Japan and Europe declined in July.

In the January to July period, exports rose 0.5 percent, while imports fell 1.3 percent, from a year ago.


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EUR/USD. "Green" Nonfarms and bad news from Capitol Hill

Trading 07 août 2020 Commentaire »

The US dollar ends the current trading week on a major note: despite the ongoing political battles in the US Congress, the greenback strengthened across the market, thanks to strong macroeconomic reports.

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The EUR/USD pair collapsed by more than 100 points. Other currency pairs of the so-called "major group" showed similar dynamics, reflecting the demand for the dollar. However, it is too early to talk about a trend reversal – even in the medium term. The American won today's round, but the complete victory is still far away – at least, to break the situation, you need good news from Capitol Hill (which is not). Therefore, at the moment, we can only talk about a correction. A large-scale, fairly comprehensive, but still correction. The next trading week will put everything in its place – but in the meantime, dollar bulls can "uncork the champagne": Non-Farms have become a kind of lifeline for the US currency.

What happened?

Key data on the labor market for July were published today. Non-Pharmaceuticals themselves play an important role for traders, but this release had a special significance for the market. First, in July, an outbreak of coronavirus was recorded in the United States. The daily increase in the number of cases did not fall below the 60-thousand mark, and on some days it remained above the 70-thousand target. The epicenter of the epidemic shifted to the south of the country – in California, Florida, and Texas, record rates of morbidity and mortality were recorded (and are still being recorded). Although the quarantine restrictions were not tightened at the national level, local authorities took appropriate decisions (for example, in Miami). This circumstance could negatively affect the dynamics of the recovery of the American labor market.

Secondly, on the eve of the release of July Nonfarms, the market received quite ambiguous signals. For example, the increase in the number of initial applications for unemployment benefits in mid-July paused its decline (which lasted for 12 weeks) and began to show a slight pullback, reflecting worrying trends in the labor market. Also, just two days before today's release, an extremely weak report was published from the ADP agency, whose experts also monitor the situation in the US labor market. According to their data, in July, the increase in the number of people employed in the private sector was only 167 (experts predicted to see an increase of up to 1.5 million).

In other words, the intrigue around the July Nonfarms persisted until the last minute, so the reaction to today's release was very volatile. The pendulum could swing one way or the other. As a result, Nonfarm were on the side of the dollar: almost all components of the release came out in the "green zone", exceeding the forecasts of experts. Thus, the unemployment rate fell to 10.2% (the forecast was at 10.5%), and the number of people employed in the non-agricultural sector increased by 1 million 763 thousand (with forecast growth of 1.5 million). Only the manufacturing sector of the economy "pumped up" – the increase in the number of people employed in this area was only 26 thousand, although analysts expected to see this figure much higher, at the level of 250 thousand. But salaries – pleased. The average hourly wage rose by 0.2% every month (the indicator came out of the negative territory for the first time since May), and rose to 4.8% on an annual basis (with a growth forecast of 4.2%). The growth of this indicator has a positive impact on the level of consumer activity of Americans, and therefore on inflationary processes.

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Thus, the dollar is reasonably growing today, demonstrating a corrective recovery. The published data reduced market concerns about the prospects for recovery of the US economy in the second half of the year. But for a more confident growth, dollar bulls lack the last puzzle, "worth" one trillion dollars. We are talking about the Republican party's bill on additional assistance to the US economy. Republicans still cannot agree with the Democrats, although both sides assure reporters that "some progress has been made". But the de facto situation is hanging in the air: congressmen from different political camps do not want to make serious concessions in the run-up to the presidential election. Moreover, as White House economic adviser Larry Kudlow said today, negotiations on the stimulus package "have reached an impasse to date". This fact did not allow the dollar bulls to fully manifest themselves: the growth of the dollar index and the decline of the euro/dollar pair was limited.

How to trade?

At the moment, the first reaction to the publication of Nonfarm has already subsided. The dollar index began to gradually slide down again, and the eur/usd pair floated in the 17th figure. This is largely because traders began to fix profits en masse, without risking leaving open positions for the weekend. Especially since the negotiations between Republicans and Democrats will take place on Saturday and Sunday. If they announce a compromise by Monday, the dollar will continue its ascent. Otherwise, the greenback will return to the same positions as it was before Nonfarming. In the context of the eur / usd pair, this means that the pair will return to the area of the 18th figure and again try to test the 19th price level. Thus, it is too late to open trading positions now – traders have already "played" the macroeconomic release. On the weekend, it is necessary to monitor American news feeds: if the congressmen still find a common denominator, the downward movement of EUR/USD will resume with a new force. The main support level (the goal of the southern movement) is located at 1.1650 – this is the lower line of the Bollinger Bands indicator on the daily chart.

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Comprehensive analysis of movement options for #USDX vs EUR/USD & GBP/USD & USD/JPY (Daily) on August 10, 2020

Trading 07 août 2020 Commentaire »

Minor operational scale (Daily)

Are the peaks conquered? Correction? Options for the development of the movement #USDX vs EUR/USD & GBP/USD & USD/JPY (Daily) on August 10, 2020.

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US dollar index

From August 10, 2020, the movement of the dollar index #USDX will continue depending on the direction of the breakout of the range:

  • resistance level of 93.35 - the lower limit of the channel 1/2 Median Line of the Minute operational scale fork;
  • support level of 93.05 - upper bound of ISL38.2 balance zone of the Minor operational scale fork.

In case of a breakdown of the resistance level of 93.35, the movement of the dollar index will continue in the 1/2 Median Line Minute channel (93.35 - 93.65 - 94.00) with the possibility of continuing the development of the movement already in the equilibrium zone (94.25 - 94.80 - 95.30) of the Minute pitchfork with the prospect of reaching the initial SSL lines (96.25) of the Minor operational scale forks and the FSL Minute end lines (97.10).

If the support level of 93.05 breaks at ISL38.2 Minor, the #USDX movement will continue its development in the equilibrium zone (93.05 - 91.90 - 90.80) of the Minor operational scale fork.

The markup of the #USDX movement options from August 10, 2020 is shown on an animated chart.

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Euro vs US dollar

The single European currency EUR/USD from August 10, 2020 will be determined by the development and direction of the breakdown of the range:

  • resistance level of 1.1835 - the lower border of ISL38.2 equilibrium zone of the Minute operational scale fork;
  • support level of 1.1735 - the upper border of the channel 1/2 Median Line Minute.

In case of a breakdown of the support level of 1.1735, the movement of the single European currency will continue in the channel 1/2 Median Line (1.1735 - 1.1685 - 1.1645) of the Minute operational scale fork, and in the event of a breakdown of the lower boundary (1.1645) of this channel, the downward movement of this instrument can continue to the control line LTL Minute (1.1510) and the boundaries of the equilibrium zone (1.1345 - 1.1245 - 1.1135) of the Minor operational scale fork.

A breakdown of the resistance level of 1.1835 at ISL38.2 and Minute will return the development of the EUR/USD movement to the boundaries of the equilibrium zone (1.1835 - 1.1940 - 1.2010) of the Minute operational scale fork with the prospect of reaching the control line UTL (1.2120) of the Minor operational scale fork.

The EUR/USD movement options from August 10, 2020 are shown on the animated chart.

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Great Britain pound vs US dollar

The development of the movement of Her Majesty's currency GBP/USD from August 10, 2020 will also be due to the development and direction of the breakdown of the range:

  • resistance level of 1.3150 - the lower border of ISL38.2 equilibrium zone of the Minute operational scale fork;
  • support level of 1.3070 - the final Shiff Line Minute.

The breakdown of the final Shiff Line Minute - support level of 1.3070 - will determine the continuation of the downward movement of the currency of Her Majesty to the goals:

  • initial SSL line (1.2880) of the Minute operational scale fork;
  • channel 1/2 Median Line Minute (1.2845 - 1.2775 - 1.2695);
  • with the prospect of reaching the control lines - UTL Minor (1.2550) and LTL Minute (1.2460).

A breakdown of the 1.3150 resistance level at ISL38.2 Minute will make the development of the GBP/USD movement in the equilibrium zone relevant (1.3150 - 1.3300 - 1.3400) of the Minute operational scale fork.

Options for the movement of GBP/USD from August 10, 2020 are shown on the animated chart.

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US dollar vs Japanese yen

The development of the movement of the currency of the "Land of the Rising Sun" USD/JPY from August 10, 2020 will be determined by the development and direction of the breakdown of the boundaries of the equilibrium zone (104.80 - 105.45 - 105.90) of the Minute operational scale fork - details of movement within this zone are shown on the animated chart of the Minute operational scale fork.

The breakdown of the resistance level of 105.90 at the upper boundary ISL38.2 zone equilibrium of the Minute operational scale fork will be relevant in the development of the upward movement of the currency "Land of the Rising Sun" to the ultimate Shiff Line Minute (106.65), the lower boundary ISL38.2 (107.35) fork operational scale Minor, and the borders of the channel 1/2 Median Line Minute (108.10 - 108.50 - 109.00).

A breakout of the lower border ISL61.8 zone equilibrium of the Minute operational scale fork - support level 104.80 - confirm the further development of the movement of USD/JPY in the channel 1/2 Median Line (105.20 - 103.90 - 102.50) of the Minor operational scale fork.

The markup of USD/JPY movement options from August 10, 2020 is shown on an animated chart.

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The review is compiled without taking into account the news background, the opening of trading sessions of the main financial centers and is not a guide to action (placing "sell" or "buy"orders).

Formula for calculating the dollar index:

USDX = 50.14348112 * USDEUR0.576 * USDJPY0.136 * USDGBP0.119 * USDCAD0.091 * USDSEK0.042 * USDCHF0.036.

Where the power coefficients correspond to the weights of currencies in the basket:

Euro — 57.6 %;

Yen — 13.6 %;

Pound sterling — 11.9 %;

Canadian dollar — 9.1 %;

Swedish Krona — 4.2 V %;

Swiss franc — 3.6 %.

The first coefficient in the formula brings the index value to 100 on the starting date-March 1973, when the main currencies began to be freely quoted relative to each other.

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