Forex News Analysis by LiteForex

LiteForex analitics. Morning Market Review

Morning Market Review
2019-01-10 09:49 (GMT+2)
US dollar is falling against most majors. Yesterday’s statements by the Fed representatives put pressure on the instrument. Chief executive officer of the Federal Reserve Bank of Chicago, Charles Evans, said that the regulator could postpone the next rate increase due to uncertainty about the prospects for the American economy. Eric Rosengren, the Boston Fed president, also proposes to postpone the increase in interest rates, and the current monetary policy, in his opinion, is appropriate under the current economic conditions. Investors reacted to these statements by selling the US currency. Macroeconomic events that can affect the dollar rate today include the statistics on initial jobless claims in the US (15:30 GMT+2), as well as the speech by the Fed Head Jerome Powell (19:00 GMT+2).

EUR/USD

The EUR/USD pair, supported by positive statistics on unemployment in the eurozone and the general weakening of the dollar, has risen to 1.1555. Today, investors will pay attention to the publication of ECB Account of Monetary Policy Meeting.

GBP/USD

Quotations of the pair GBP/USD rose to the level of 1.2782 due to the general weakening of USD. In the absence of news from the UK, the movement of the instrument will be influenced by the news from the United States.

USD/JPY

Quotes of the USD/JPY pair fell to 107.81 amid USD sales, triggered by statements by representatives of the US Federal Reserve.

AUD/USD

The AUD/USD pair shows a moderate positive trend against the background of the general weakening of the US dollar, having risen to the level of 0.7186.

Gold

Gold quotes returned to the weekly highs and are trading at 1296.90 due to the weakened USD.

LiteForex analitics. Morning Market Review

US dollar is showing weak negative dynamics against the majors during the Asian session. After active growth the day before, the observed decline in the dollar is correctional. In general, the pressure on the dollar continues to be exerted by the mitigated rhetoric of some representatives of the US Fed, including Jerome Powell, who said that the regulator could postpone the next increase in the interest rate in 2019. Today the statistics on the Consumer Price Index in the US (15:30 GMT+2) will be able to influence the rate. The indicator in monthly terms is expected to decrease to –0.1% in December from 0.0% a month earlier, and in annual terms it can decrease to 1.9% in December from 2.2% in the previous month. If this forecast is right, it will put pressure on the US dollar in the short run.

EUR/USD

The pair EUR/USD rose to 1.1526 due to the weakening USD. In the absence of news from the euro area, the movement of the instrument will be influenced by the news from the United States.

GBP/USD

The GBP/USD pair is growing insignificantly and is trading at 1.2756 during the Asian session. Investors are waiting for the publication of macroeconomic data from the UK on GDP, industrial production and manufacturing production (11:30 GMT+2). GDP is expected to remain unchanged at the level of 0.1% in November. Industrial production is expected to rise to 0.3% in November from –0.6% a month earlier. Manufacturing production is expected to rise to 0.4% MoM in November from –0.9% a month earlier, and YoY it can rise to –0.7% in November from –1.0% a month earlier. In general, confirmation of forecasts may support the GBP.

USD/JPY

The USD/JPY pair is moderately declining having fallen to 108.26 during the Asian session. Statistics from Japan published tonight turned out to be ambiguous and was ignored by the market. Household Spending YoY decreased to –0.6% in November from –0.3% a month earlier, and in monthly terms, the value of the indicator decreased less than expected and amounted to 1.1% in November against 1.8% a month earlier.

AUD/USD

Quotes of the pair AUD/USD show moderate positive dynamics reaching the level of 0.7210. The instrument is supported by positive data from Australia, published at night. Retail sales rose to 0.4% in November from 0.3% a month earlier.

Gold

The gold rate is growing against the backdrop of a weakening dollar, reaching 1293.00.

LiteForex analitics. WTI Crude Oil: price is consolidating

Current trend

After an active growth at the beginning of the year, oil prices are consolidating near the level of $50 per barrel.

"Black gold" is supported by investors' hopes for a positive outcome of China-US trade negotiations and the end of the trade conflict in the near future. In addition, quotes are rising against the background of the Norwegian Petroleum Directorate, which reported a likely reduction in production by 4.8% to 1.42 million barrels per day in 2019, which is the minimum figure for the last 30 years.

Last Friday, Baker Hughes US Oil Rig Count report affected the instrument positively. During the week, the number of rigs decreased by 4 to 873 units. Over the past period, the figure also declined from 885 to 877.

Support and resistance

On the daily chart, Bollinger bands are growing steadily. The price range narrows, reflecting the emergence of ambiguous trading dynamics in the short term. The MACD indicator is growing, keeping a buy signal (the histogram is above the signal line), and is testing the zero line but is not likely to consolidate above it. Stochastic declines, reacting to the active “bearish” dynamics of the beginning of the week.

The current readings of the indicators do not contradict the further development of the corrective decline in the short and/or super short term.

Resistance levels: 52.00, 53.19, 54.43, 55.64.
Support levels: 50.00, 49.00, 48.05, 47.00, 45.80.

Trading tips

Long positions can be opened after the rebound from the level of 50.00 with the target at 52.00 or 53.19. Stop loss is 49.00.

Short positions can be opened after the breakdown of the level of 50.00 with the target at 48.05 or 47.00. Stop loss is 51.00.

Implementation period: 2–3 days.

LiteForex analitics. Morning Market Review

The US dollar is declining against the pound and the Australian currency, however, it shows a sideways trend paired with the euro and is growing against the yen. Today, investors will pay attention to the publication of PPI in the US (15:30 GMT+2). The indicator in monthly terms is expected to decrease to –0.1% in December from 0.1% a month earlier, and in annual terms it can remain unchanged at 2.5% in December. In the afternoon, speeches by members of the US Federal Reserve are expected. Speech by Neel Kashkari is planned for 18:30 (GMT+2), and speeches by Esther George and Robert Kaplan are expected at 20:00 (GMT+2). From their speeches, investors are hoping to understand the intentions of the regulator regarding the rate hike in 2019. Speeches of officials of this rank can have a significant impact on the dynamics of the dollar.

EUR/USD

The EUR/USD pair is moving within the range of 1.1449–1.1488. Investors are awaiting publication of data from the euro area on the trade balance (12:00 GMT+2), as well as the speech by the ECB President Mario Draghi (17:00 GMT+2).

GBP/USD

The pair GBP/USD continues showing positive dynamics having risen to 1.2908 during the Asian session. Today, investors are waiting for the outcome of the vote in the British Parliament on Brexit. Theresa May calls on MPs to approve the treaty, arguing that the consequences could otherwise be catastrophic. In case of failure of the vote, the Prime Minister will have three working days to prepare an alternative version of the contract.

USD/JPY

The USD/JPY pair is rising actively and has reached the level of 108.74 during the Asian session. Due to the absence of significant macroeconomic releases in Japan, the movement of the instrument is mostly technical.

AUD/USD

The pair AUD/USD is rising having reached 0.7217 during the Asian session. Against the background of the absence of macroeconomic releases from Australia, the movement of the instrument's rate is of a technical nature.

Gold

Quotes of gold demonstrate lateral dynamics and are traded near the level of 1290.00.

LiteForex analitics. Morning Market Review

The US dollar moderately strengthens against the euro and the yen, but shows a lateral trend paired with the Australian currency. Statistics from the USA, published yesterday, indicated a decline in the Producer Price Index to –0.2% in December from 0.1% a month earlier, but did not have a significant impact on the instrument. Investors continue to follow the news regarding the US government shutdown, which has been going on for the fourth week and, according to representatives of the administration, may last until the end of February. This situation threatens the market with possible negative consequences. Macroeconomic statistics, which can influence USD today, include the data on retail sales in the USA (15:30 GMT+2).

EUR/USD

The EUR/USD pair dropped to the level of 1.1410. EUR is under pressure from yesterday’s speech by the ECB President Mario Draghi at the European Parliament. The official believes that the slowdown in the economy can last longer than expected. Uncertainty about Brexit puts additional pressure on the euro. Yesterday, the British Parliament rejected an agreement on the UK leaving the EU, prepared by Prime Minister Theresa May.

GBP/USD

The GBP/USD pair showed ambiguous dynamics on Tuesday amid heightened volatility caused by the outcome of a vote in the UK Parliament on withdrawal from the EU. Quotes fell to the level of 1.2667, after which they quickly returned to the level of 1.2869, where they are trading during today's Asian session. Yesterday, the British MPs rejected an agreement prepared by the government of Theresa May and the EU. MPs voted 432 to 202 to defeat the proposal. Now the Prime Minister has three days to present an alternative to the Brexit agreement. During this time, Theresa May will probably try to get new concessions from the EU, as well as convince the Parliament to support the deal. The instrument today may be affected by the speech of the Bank of England head Mark Carney (11:15 GMT+2), as well as statistics on the CPI in the UK in December (11:30 GMT+2).

USD/JPY

After active growth on Tuesday, the USD/JPY pair corrected down to 108.47 during today's Asian session. Yesterday's statistics from Japan was ignored by investors. The movement of the instrument rate is primarily technical. Tertiary Industry Activity Index was better than expected, but worse than in the previous month and amounted to –0.3% in December against 2.2% a month earlier.

AUD/USD

The AUD/USD pair shows lateral dynamics within the range of 0.7224–0.7178 and has changed slightly on the whole.

Gold

Quotes of gold have ambiguous dynamics. After an active decline yesterday and a test of the level of 1286.56, the instrument rate returned to 1292.15 during the Asian session.

LiteForex analitics. Morning Market Review

The US dollar is moving horizontally paired with the euro, falling against the pound and the Australian currency, but is strengthening against the yen. The instrument is supported by macroeconomic statistics from the USA published yesterday. The number of initial jobless claims dropped to 213K from 216K a week earlier, which is the lowest level in the last 5 weeks. Philadelphia Fed Manufacturing Index was better than expected reaching 17.0 points in January against 9.1 points a month earlier. Today, investors are waiting for the publication of data on Industrial Production in the US. It is expected that the indicator will fall to 0.2% in December from 0.6% a month earlier. If this assumption is right, it will put pressure on the US dollar in the short run.

EUR/USD

The EUR/USD pair is moving within the range of 1.1370–1.1403. Today, the macroeconomic calendar of euro area lacks important releases, so the movement of the rate will depend on the news from the US. Investors continue monitoring the development of the situation around Brexit. After the failure of a vote in the British Parliament, Theresa May must prepare a fallback deal.

GBP/USD

The pair GBP/USD continues showing positive dynamics and rose to 1.2970 during the Asian session. Theresa May survived a vote of no confidence and is preparing an alternative Brexit deal for January 21. Macroeconomic releases able to influence the instrument today include data on retail sales in the UK (11:30 GMT+2). The indicator in monthly terms is expected to decrease to –0.8% in December from 1.4% a month earlier, and in annual terms it can remain unchanged at 3.6% in December.

USD/JPY

The pair USD/JPY rose to 109.37 due to the positive statistics from the US. Statistics from Japan published this night puts pressure on the yen. National Core CPI went down to 0.7% in December from 0.9% a month earlier.

AUD/USD

The AUD/USD pair rose to 0.7202 during the Asian session. In the absence of significant releases, the movement of AUD is technical.

Gold

Quotes of gold demonstrate lateral dynamics and are traded near the level of 1291.02.

LiteForex analitics. Morning Market Review

After active growth on Friday, the US dollar is moderately declining against most majors during today's Asian session. Due to the holiday in the US, investors correct their long dollar positions. Investors are still focused on the US-China trade negotiations. The market remains optimistic, perceiving data on a possible softening of the American position as a sign of a conclusion of a big deal.

EUR/USD

The EUR/USD pair rose to 1.1375 during the Asian session due to correction of USD. Due to the absence of important releases in the euro area, the movement of the instrument is technical.

GBP/USD

The pair GBP/USD continues showing negative dynamics having declined to 1.2856 during the Asian session. There are no significant releases planned in the British macroeconomic calendar today. Today Prime Minister Theresa May is to submit an alternative option for the country's withdrawal from the EU to the UK Parliament.

USD/JPY

Quotes of the pair USD/JPY decreased to 109.57 due to the low trading activity. Due to the absence of important releases in the US and Japan, the movement of the instrument is technical.

AUD/USD

Quotes of the AUD/USD pair went up to the level of 0.7167 during the Asian session, ignoring the weak data on HIA New Home Sales in Australia. According to statistics published tonight, the value of the index fell to –6.7% in December from 3.6% a month earlier.

Gold

During the Asian session, the quotations of gold tried to consolidate below 1281.25 several times, but failed and the rate moved to the phase of the upward correction.

LiteForex analitics. Morning Market Review

Morning Market Review
2019-01-22 10:12 (GMT+2)
USD strengthens moderately against most majors, with the exception of the yen. On Monday, the American stock exchanges were closed due to the celebration of Martin Luther King, Jr. Day, so there was a decrease in trading activity. Macroeconomic releases able to influence the instrument today include data on existing home sales in the US (17:00 GMT+2). The indicator is expected to reduce to 5.25M in January from 5.32M a month earlier. If this forecast is right, it will put pressure on the US dollar in the short run.

EUR/USD

Quotes of the EUR/USD pair went down to 1.1355 against the background of low trading activity. Investors are waiting for the publication of data from the euro area on ZEW Economic Sentiment. The indicator is expected to amount to –20.1 points in January against –21.0 points a month earlier. Despite the expected small increase in the indicator, pessimism in European business circles will continue to prevail, which could adversely affect the euro.

GBP/USD

The GBP/USD pair is moderately declining and is trading at 1.2878 during the Asian session. Yesterday, Theresa May presented an alternative Brexit plan in the British Parliament. As it turned out, the fallback is not much different from the previous one, rejected by Parliament. Among the main differences proposed there is the abolition of 65 pounds fee for EU citizens who want to stay in the UK after Brexit. A repeated referendum on the issue of the withdrawal of the United Kingdom from the EU will not be held. Also, the British Prime Minister said that the government has changed its policy and will listen more to the opinion of MPs during the work on a new Brexit agreement. Macroeconomic releases that could have an impact on the pound today include data on unemployment and average earnings in the UK (11:30 GMT+2).

USD/JPY

The USD/JPY pair is declining moderately and is testing the level of 109.37 during the Asian session. As there is lack of key economic releases, the instrument is traded under the influence of technical factors.

AUD/USD

The AUD/USD pair dropped to 0.7138 during the Asian session. The pressure on the Australian currency is still exerted by weak data on new home sales in Australia, as well as weak statistics on China's GDP for the fourth quarter.

Gold

After testing the level of 1277.20, gold quotations slightly corrected upwards, but the downward trend still persists.

LiteForex analitics. Morning Market Review

US dollar is falling against most majors. Yesterday's weak statistics on Existing Home Sales in the US exerts pressure on the instrument. The indicator went down to 4.99M in December from 5.33M in the previous month (–6.4%). The US macroeconomic calendar lacks important releases today. The movement of the USD paired with other currencies will be affected by the external factors. On the whole, the longest-lasting government shutdown continues to have a negative impact on the instrument. The parties are still far from a compromise, so it is possible that the government agencies shutdown will last until February or March. Such a scenario can lead to a weakening of the national economy by 0.5%.

EUR/USD

The pair EUR/USD rose to 1.1366 due to the weakening USD. In the absence of news from the US and the euro area, the movement of the instrument will be influenced by technical factors.

GBP/USD

Quotes of the pair GBP/USD rose to the level of 1.2939, where they are consolidating during the Asian session. Yesterday's strong data on the labor market in the UK, as well as the general weakening of the US currency, support the pound. Today, market participants are waiting for the publication of data on CBI Industrial Trends Orders. The indicator is expected to drop to 5 points in January from 8 points in the previous month. If the forecast proves right, the pound may fall under pressure.

USD/JPY

The USD/JPY pair today rose to 109.76 during the Asian session. Pressure on the yen is exerted by weak export data and All Industries Activity Index of the Japanese economy. Exports fell to –3.8% in December from 0.1% a month earlier, which is the most significant drop in the last two years. All Industries Activity Index went down to –0.3% in November from 2.1% a month earlier. As expected, the Bank of Japan left the interest rate unchanged at –0.10% and lowered its forecast for core consumer inflation from 1.4% to 0.9% in the fiscal year starting in April.

AUD/USD

Quotations of the pair AUD/USD rose to the level of 0.7141 due to the general weakening of USD. Due to the absence of important releases, the movement of the instrument is technical.

Gold

Due to the yesterday's weak US statistics, gold quotations increased to 1284.00.

LiteForex analitics. Morning Market Review

The US dollar shows ambiguous dynamics against most majors, falling against the euro, pound and the yen, but strengthening against the Australian dollar. Today, market participants expect the publication of data from the United States on Initial Jobless Claims (15:30 GMT+2), as well as on Manufacturing PMI (16:45 GMT+2). It is expected that the number of initial jobless claims will rise to 220K from 213K a week earlier. Manufacturing PMI is expected to fall to 53.5 points in January from 53.8 points a month earlier. If this forecast is right, it will put pressure on the US dollar in the short run.

EUR/USD

During yesterday's trading, the quotes of the EUR/USD pair strengthened significantly and reached the level of 1.1380, near which they are consolidating during the Asian session. Today, investors are waiting for the publication of data from the euro area on the Manufacturing PMI as well as on Services PMI (11:00 GMT+2), and also for the ECB interest rate decision. The rate is expected to remain unchanged at the level of 0.00%. Today at 15:30 GMT+2, Mario Draghi is expected to give a press conference. It is expected that the head of the ECB will describe the risks to the European economy and assess the results of the completed asset purchase program. Draghi’s opinion will be particularly important due to the potential aggravation of trade relations between the US and the EU. Manufacturing PMI is expected to remain unchanged at the level of 51.4 points in January. Services PMI is expected to grow to 51.5 points in January from 51.2 points a month before.

GBP/USD

The pair GBP/USD is showing positive dynamics having risen to 1.3070 during the Asian session. The pound is supported by the likely extension of the Brexit negotiation process and the postponement of the UK’s final withdrawal from the EU from March 29 to a later date. Today, the macroeconomic calendar of the UK lacks important releases, so the movement of the rate will depend on external factors.

USD/JPY

The pair USD/JPY dropped to 109.57 due to the general weakening of USD. As there is a lack of key economic releases, the movement of the price is of technical nature.

AUD/USD

During the Asian trading session, the quotes of AUD/USD are traded in both directions. After the publication of positive statistics on the labor market in Australia, the rate of the instrument rose to the level of 0.7165, after which it just as quickly went down to the level of 0.7103. Employment Change turned out to be better than the forecasts and amounted to 21.6K in December against 37.0K a month earlier (with the forecast of +16.5K). The Unemployment Rate dropped to 5.0% in December from 5.1% a month earlier.

Gold

Gold quotations are falling moderately having dropped to 1281.25 during Asian trading.