Forex Analysis by LiteForex

[MikhailLF]

Morning Market Review
2019-11-13 08:48 (GMT+2)
EUR/USD

EUR showed a moderate decline against USD on Tuesday, updating local lows of October 15. The euro got some support from macroeconomic statistics from Europe. German ZEW Economic Sentiment in November showed a sharp increase from –22.8 to –2.1 points with a forecast of –13 points. German ZEW Current Conditions for the same period rose from –25.3 to –24.7 points, which turned out to be worse than the forecasts of –22 points. The EU ZEW Economic Sentiment in November showed strong positive dynamics, increasing from –23.5 to –1 point with a forecast of –32.5 points. The pressure on the instrument, in turn, was exerted by the results of Donald Trump's speech at the New York Economic Club. Trump remained true to his previous statements and touched very little on the topic of US-European trade relations, noting that the EU is increasingly setting up "terrible" trade barriers.

GBP/USD

GBP showed ambiguous dynamics of trading on Tuesday, interrupting the development of the "bullish" impulse formed the day before. The instrument was under pressure from contradictory macroeconomic statistics from the UK. Claimant Count Change in October rose sharply from 13.5K to 33K, while analysts had expected an increase of only 21.3K. Average Earnings ex Bonus in September slowed down from +3.8% 3MoY to +3.6% 3MoY with a neutral forecast. In turn, the Unemployment Rate in September fell from 3.9% to 3.8% (3M/3M). Today, the pound is also showing ambiguous dynamics, waiting for new drivers to appear at the market. Investors expect the publication of statistics on consumer and industrial inflation for October.

AUD/USD

AUD showed a decline against USD on Tuesday, having updated local lows of October 28. The further development of negative dynamics in the instrument was facilitated by Donald Trump, who spoke on Tuesday at the New York Economic Club. Investors were waiting for statements on the development of trade relations between the United States and China, which hovered before the signing of the preliminary agreement, but the US president did not say anything new about this. Trump noted that China is still striving to conclude a trade agreement, but the deal will only be signed on terms profitable to the US economy. If the agreement is not concluded, then the United States is ready to introduce new import duties.

USD/JPY

USD showed ambiguous dynamics against JPY on Tuesday, closing with a slight "bearish" margin. Moderate support for the Japanese currency is still provided by the uncertain situation surrounding the conclusion of a preliminary trade deal between the United States and China. Donald Trump’s speech on Tuesday again did not clarify this issue; therefore, one should not exclude further moderate growth in demand for Japanese currency. In turn, weak macroeconomic statistics from Japan does not allow the instrument to develop a more confident decline. Machine Tool Orders data published on Tuesday showed a decrease of 37.4% YoY in October after a decrease of 35.5% YoY in September.

Oil

Oil prices showed ambiguous trading dynamics on Tuesday, reacting to the neutral results of Donald Trump's speech. The US President did not say anything new about the prospects for concluding a trade deal, so the uncertainty surrounding this issue only intensifies, since the threat of introducing new import duties remains. Today, oil quotes show a slight decrease. Investors expect the publication of statistics on consumer inflation from the United States, as well as the release of API Weekly Crude Oil Stock for the week ending November 8.

 

[MikhailLF]

Morning Market Review
2019-11-14 08:51 (GMT+2)
EUR/USD

EUR showed ambiguous dynamics against USD on Wednesday, updating local lows of October 15. Yesterday's macroeconomic statistics from the EU failed to provide significant support to EUR. German Consumer Price Index in October showed an increase of 0.1% MoM and 1.1% YoY, which fully coincided with market expectations. Harmonized Consumer Price Index for the same period increased by 0.1% MoM and 0.9% YoY, which also agrees with expert estimates. In turn, Industrial Production in the euro area in September rose from –2.8% YoY to –1.7% YoY with a forecast of growth to –2.3% YoY. In monthly terms, production volumes, on the contrary, slowed down from 0.4% MoM to 0.1% MoM, which turned out to be better than market expectations of –0.3% MoM. Today, the euro is trading in both directions, waiting for the appearance of new drivers at the market. Investors will focus on the EU GDP for Q3 2019 and a quarterly report on the Employment Rate.

GBP/USD

GBP ended Wednesday trading with multi-directional dynamics against USD. Additional pressure on the pound was exerted by weak macroeconomic statistics from the UK. Consumer Price Index in October showed a decrease of 0.2% MoM after an increase of 0.1% MoM a month earlier. Analysts had expected "bearish" trend to appear, but counted on only –0.1% MoM decline. In annual terms, the index has slowed from 1.7% YoY to 1.5% YoY, with the forecast of 1.6% YoY. Retail Price Index in October showed a negative trend of –0.2% MoM, which coincided with the data of the previous month. In annual terms, the index has slowed from 2.4% YoY to 2.1% YoY, with the forecast of 2.2% YoY. Today, the pair maintains its previous dynamics, waiting for the release of new data. British investors are interested in the publication of October statistics on retail sales. Moderately optimistic data is expected to appear, which may provide some support for the British currency.

AUD/USD

AUD showed ambiguous dynamics against USD on Wednesday, closing the session with almost zero result. The reason for the development of flat trading was controversial macroeconomic statistics from Australia and the United States, as well as recent comments by Donald Trump, who did not shed light on the prospects of concluding a trade agreement between the United States and China. Moreover, many investors considered the speech of the American president a signal for their possible complication, since Trump again accused China of "manipulation" and noted that the deal would be signed only on condition that it would be "useful" for the US economy. Today, the instrument is steadily declining in response to the publication of disappointing statistics from Australia and China. Australia's Employment Change in October showed a decline of 19K after an increase of 12.5K in the previous month. Analysts had expected growth by 15K. Australia's Unemployment Rate, as expected, rose from 5.2% to 5.3%.

USD/JPY

USD fell against JPY on Wednesday, updating local lows of November 7. USD continues to decline amid growing demand for safe assets after a speech by Donald Trump left questions about the prospects for a trade agreement between the United States and China unanswered. In addition, in his speech, the American president also accused the leadership of the EU of manipulation, which could complicate consultations on this issue and lead to an additional increase in world trade tension. Today, the instrument maintains a moderate downtrend, despite the publication of weak macroeconomic statistics from Japan. Japan's GDP in Q3 2019 showed an increase of only 0.1% QoQ, slowing down from the previous value of 0.3% QoQ. Analysts had expected growth rate at 0.2% QoQ.

Oil

Oil prices showed moderate growth on Wednesday, receiving support from optimistic OPEC statements. Cartel Secretary General Mohammad Barkindo noted that there are no signs of a global recession in the world economy, so an increase in demand is quite possible as economic growth resumes. In addition, OPEC expects a slowdown in shale oil production, which should also have a beneficial effect on the balance of supply and demand in the market. Finally, quotes were supported by API Crude Oil Stock Report, according to which oil reserves fell by 0.5M barrels over the week ending November 8, after rising by 4.26M barrels in the previous reporting period.

 

[MikhailLF]

Morning Market Review
2019-11-15 08:51 (GMT+2)
EUR/USD

EUR showed moderate growth against USD on Thursday, interrupting the development of a downward rally since November 4. The appearance of correctional dynamics was facilitated by moderately optimistic macroeconomic statistics from the euro area. German GDP in Q3 2019 increased by 0.1% QoQ, accelerating from the previous value of –0.2% QoQ. Analysts had expected growth rate at 0.1% QoQ. In annual terms, GDP increased by 1.0% YoY after falling by 0.1% YoY in Q2 2019. Forecasts suggested an increase of 0.9% YoY. In the euro area, economic growth was less noticeable. In quarterly terms, the EU GDP added the previous 0.2% QoQ, and in annual terms it accelerated from +1.1% YoY to +1.2% YoY.

GBP/USD

GBP rose against USD on Thursday, rising to local highs, updated earlier this week. The growth of the instrument was largely determined by technical factors, while the macroeconomic background from the UK remained negative. UK Retail Sales in October showed a decrease of 0.1% MoM, despite an expected increase of 0.2% MoM. In annual terms, the indicator strengthened by 3.1% YoY, which coincided with the data for the previous month. Analysts expected an increase of 3.7% YoY. Core Retail Sales for the same period decreased by 0.3% MoM after rising 0.2% MoM in September. In annual terms, the index slowed down from 2.9% YoY to 2.7% YoY against a forecast of 3.4% YoY.

AUD/USD

AUD closed Thursday trading with a steady decline against USD, updating local lows of October 17. Pressure on the instrument was exerted by disappointing macroeconomic statistics on employment from Australia. October Employment Rate fell by 19.0K after rising by 14.7K in the previous month. Analysts had expected positive dynamics to remain at 15.0K. Australia's Unemployment Rate, as expected, rose from 5.2% to 5.3%. Additional negative impact on the instrument had Chinese data. In October, China's Industrial Production slowed down from 5.8% YoY to 4.7% YoY, which turned out to be worse than market expectations of 5.4% YoY. Retail Sales in China over the same period decreased from 7.8% YoY to 7.2% YoY, which also turned out to be weaker than market forecasts of 7.9% YoY.

USD/JPY

USD showed a decline against JPY on Thursday, updating local lows of November 4. The growth of the Japanese currency proceeded against the background of the publication of extremely weak macroeconomic statistics from Japan. Japanese GDP in Q3 2019 increased by 0.1% QoQ after growing by 0.4% QoQ in the previous period. Analysts had expected growth rate at 0.2% QoQ. In annual terms, GDP has slowed from 1.8% YoY to 0.2% YoY, with the forecast of 0.8% YoY. Given such weak data, investors fear that the Bank of Japan will take new measures to stimulate the economy, which will put additional pressure on the yen. Anyway, as long as the market remains at a high degree of uncertainty caused by the lack of progress in trade negotiations between the United States and China, the Japanese currency will be in demand.

Oil

Oil prices showed moderate growth on Thursday, but could not stay at new levels and returned to the red zone closer to the end of the afternoon session. Pressure on quotes was exerted by the report from the US Department of Energy. According to the data, the volume of crude oil in the United States for the week ending November 8 rose by 2.219M barrels after rising by 7.929M barrels for the previous period. Analysts had expected an increase in stocks of 1.649M barrels. The report also indicated a further increase in US oil production from 12.600M barrels to 12.800M barrels.

 

[MikhailLF]

Morning Market Review
2019-11-18 09:00 (GMT+2)
EUR/USD

EUR grew moderately against USD on Friday, continuing the development of the "bullish" impulse formed the day before. The growth of the instrument was largely technical in nature, since there were almost no fundamental factors at the market. Friday's macroeconomic inflation statistics from the euro area turned out to be ambiguous, but, in general, met the expectations of the market. Consumer Price Index in October slowed down from +0.2% MoM to +0.1% MoM with a neutral outlook. In annual terms, growth in consumer inflation amounted to the previous +0.7% YoY. Core Consumer Price Index in October increased by 0.1% MoM and 1.1% YoY, which fully coincided with preliminary estimates by experts. Today, the euro remains growing against the dollar. During the day, investors are awaiting speeches by ECB representatives Luis de Guindos and Philip Lane.

GBP/USD

GBP is growing moderately against USD, updating local highs of November 4. The growth of the British currency at the end of last week was contributed by not the most confident macroeconomic statistics from the US, which prompted investors to further sales of the dollar. In turn, the pound remains under pressure from uncertainty around Brexit and the upcoming early parliamentary elections in December. Analysts fear that the election results will not clarify the process of negotiating a deal with the EU, since none of the parties will be able to take over the vast majority in parliament. Today, the pound continues its active upward trend, despite the publication of controversial macroeconomic statistics from the UK. The Rightmove House Price Index in November decreased by 1.3% MoM after an increase of 0.6% MoM in October. YoY, the index rose from –0.2% to +0.3%.

AUD/USD

AUD showed strong growth against USD on Friday, which allowed the instrument to partially recoup its losses after a sharp decline the day before. The appearance of correctional dynamics was largely due to technical factors, as well as the publication of weak macroeconomic statistics from the United States. Industrial Production in the USA in October decreased by 0.8% MoM after a decrease of 0.3% MoM in the previous month. Analysts had expected reduction by 0.4% MoM. Capacity Utilization Rate in October decreased from 77.5% to 76.7%, which turned out to be worse than market expectations of 77.1%. NY Empire State Manufacturing Index in November fell from 4 to 2.9 points, while analysts expected a growth rate of up to 5 points.

USD/JPY

USD showed corrective growth against JPY on Friday, retreating from local lows of November 4. The growth of the instrument was due to the publication of strong macroeconomic statistics from Japan and weak data from the USA. Japan's Industrial Production in September increased by 1.3% YoY after rising by 1.1% YoY in the previous month. In monthly terms, production grew by 1.7% MoM after a decrease of 1.2% MoM in the previous month and with a forecast of +1.4% MoM. Capacity Utilization in September increased by 1% after a decrease of 2.9% in August. Analysts expected a negative trend to remain at the level of –0.6%. Similar statistics on Industrial Production from the United States turned out to be weaker than their forecasts, and the position of the US currency was supported only by data on Retail Sales. In October, Retail Sales grew by 0.3% MoM after a decline of 0.3% MoM in the previous month. Analysts had expected increase by 0.2% MoM.

Oil

Oil prices showed moderate growth on Friday, reacting to the appearance of optimistic signals regarding the process of trade negotiations between the United States and China. On Thursday, White House economic adviser Larry Kudlow noted that the parties are close to signing the final document. Last weekend, a telephone conversation took place between the head of the Chinese delegation, Liu He, with US Trade Representative Robert Lighthizer and US Treasury Secretary Steven Mnuchin. The results of the conversation were positive, and the parties agreed to continue negotiations during the current week. Finally, quotes were supported by the published Baker Hughes Oil Rig Count Report, according to which the number of operating drilling rigs in the US decreased from 684 to 674 units during the reporting week.

 

[MikhailLF]

Morning Market Review
2019-11-19 08:34 (GMT+2)
EUR/USD

EUR showed strong growth against USD on Monday, updating local highs of November 7. The euro was supported by optimistic statements by American officials who again spoke out for the early conclusion of a trade agreement between the United States and China. However, disagreements between the parties remain. The main requirement of Beijing, the cancellation of previously introduced tariffs, remains unfulfilled, and it is unlikely that Donald Trump will decide to change his position on this issue. In turn, China is in no hurry to include the exact volumes of US agricultural imports into the agreement. Today, the euro is trading in both directions, waiting for the appearance of new drivers at the market. Investors are focused on statistics on Construction Output in the euro area. With the opening of the American session, the focus will shift to data on US Housing Starts in October.

GBP/USD

GBP rose against USD on Monday, noting new local highs since October 22. The growth of the British currency, in addition to the technical factors of the dollar correction, was facilitated by optimistic news after opinion polls, which strengthened the belief in the victory of the Prime Minister Boris Johnson's Conservative party in the upcoming parliamentary elections. In addition, some of the seats in parliament may go to candidates from the Brexit party, led by Nigel Farage. Of course, when voting for a deal in parliament, Farage will support Johnson, which significantly increases the chances of a favorable outcome with the situation with Brexit in December-January.

AUD/USD

AUD showed flat dynamics against USD on Monday, reacting to the weak macroeconomic background of the beginning of the week. The instrument was slightly supported by data on Foreign Direct Investment in the Chinese economy. In October, investment volumes grew by 6.6% YoY after an increase of 6.5% YoY in the previous month. Today, the pair is falling again, smoothly returning to the local lows updated last week. The instrument is under pressure from the RBA meeting minutes from November 5. Despite the fact that the RBA kept the interest rate unchanged last time, investors fear that the difficult economic situation will force the regulator to take new stimulation measures. The published protocols do not talk about this directly, but they signal a persistent low inflation rate.

USD/JPY

USD showed growth against JPY on Monday, but could not stay at the occupied highs and returned to the red zone closer to the end of the afternoon session. The growth of the instrument is facilitated by the appearance of a number of optimistic signals regarding trade negotiations between the US and China; however, the parties still did not agree on the time and place of a possible signing of the agreement. Today, the instrument is declining again, and investors expect new drivers to appear on the market. The market is focused on the publication of US statistics on Housing Starts in the United States, as well as a new round of negotiations between Japan and South Korea in the WTO.

Oil

Oil prices showed a decline on Monday, responding to the emergence of contradictory signals regarding the prospects of signing a trade agreement between the United States and China. In addition, the OPEC+ meeting in early December remains in the spotlight of investors. It is expected that the cartel will decide to extend the current deal to reduce oil production amid continued low demand for oil products. Last week, OPEC announced that it expects a decline in oil demand in 2020 due to ongoing trade wars and a slowdown in the global economy. Today, investors are awaiting the publication of API Weekly Crude Oil Stock report for the week ending November 15.

 

[MikhailLF]

Morning Market Review
2019-11-20 08:54 (GMT+2)
EUR/USD

EUR showed ambiguous dynamics of trading on Tuesday, halting the development of an active "bullish" impulse, which remained since last Thursday. The development of flat dynamics was facilitated by weak macroeconomic statistics from Europe. Construction Output in September decreased by 0.7% YoY after an increase of 0.8% YoY in the previous month. Experts expected the index to accelerate to 2.7% YoY. In monthly terms, the indicator grew by 0.74% MoM after a decline of 0.82% MoM in August. The indicator was stronger than the forecast of +0.7% MoM. Investors are also focused on an uncertain situation around the US-Chinese trade negotiations. Despite the continued optimistic sentiment of some politicians, the situation seems to have come to a standstill, and so far it seems that Donald Trump will introduce new import duties on Chinese goods on December 15.

GBP/USD

GBP showed a correctional decline on Tuesday, retreating from the local highs of October 22, updated the day before. Pressure on the instrument was exerted by moderately optimistic macroeconomic indicators from the US. At the same time, GBP was supported by hopes for a positive outcome for the Brexit deal in the upcoming British parliamentary elections in December. According to recent opinion polls, the Conservative party has good chances of winning, which theoretically allows it to get the majority of seats in Parliament and ratify the current version of the agreement with the EU. American statistics indicated a moderate growth in the construction market. Building Permits increased from 1.391M to 1.461M in October with a forecast of 1.385M. Housing Starts in October rose from 1.266M to 1.314M, which only slightly fell short of forecasts of 1.320M.

AUD/USD

AUD showed moderate growth against USD on Tuesday, updating local highs of November 14. During the day, the instrument mainly declined, remaining under pressure after the publication of controversial minutes of the RBA meeting. In addition, the uncertain situation around the trade negotiations between the US and China, which has been noticeably complicated lately, is also putting pressure on AUD. Today, the instrument has returned to decline. Investors are focusing on publications from Australia, as well as the decision of the People's Bank of China on the interest rate. Westpac Leading Index fell by 0.07% in October, after falling by 0.12% last month. The Chinese regulator, in turn, unexpectedly lowered its interest rate from 4.2% to 4.15%, apparently trying to support an economy that is showing a slowing trend.

USD/JPY

USD maintains a moderate downward trend, paired with JPY, updating local lows of November 14. Demand for a "safe" yen is growing again as the next local crisis develops in US-China trade negotiations. Donald Trump is still not going to abolish previously imposed import duties, and China is in no hurry to clarify the exact volume of imports of American agricultural products in the agreement. Today, the instrument continues to develop a "bearish" trend, ignoring uncertain macroeconomic publications from Japan. Japanese exports went down by 9.2% YoY in October after the decline by 5.2% YoY in the previous month. Analysts had expected decline of 7.6% YoY. Imports for the same period decreased by 14.8% YoY after a decrease of 1.5% YoY in September. The indicator turned out better than its forecasts of –16% YoY. As a result, the overall Trade Balance in October turned out to be surplus at 17.3B Japanese yen. In the previous month, the trade balance showed a deficit of 124.8B Japanese yen.

Oil

Oil prices showed a noticeable decline on Tuesday, responding to negative forecasts by analysts regarding the prospects for a trade agreement between the United States and China. Additional pressure on the quotes was exerted by news about an increase in oil production in Norway, as the country managed to start developing the Johan Sverdrup field ahead of schedule. Finally, the American Petroleum Institute report, published on Tuesday, turned out to be a negative factor, showing that in the week ending November 15, US oil reserves rose sharply by 5.954M barrels after a decrease of 0.5M barrels over the past period. Today, investors are awaiting the publication of an official report from the US Department of Energy.

 

[MikhailLF]

Morning Market Review
2019-11-21 08:55 (GMT+2)
EUR/USD

EUR showed a flat dynamics of trading against USD on Wednesday, locating near the local highs, updated on November 18. Further development of the "bullish" trend was hindered by the publication of weak macroeconomic statistics from Europe. The markets reacted negatively to the release of the report on financial stability in the euro area, which, among other things, pointed to the growing risks of a slowdown in the European economy against the backdrop of continuing uncertainty in world markets. German Producer Price Index in October fell by 0.2% MoM after rising by 0.1% MoM in the previous month. In annual terms, the indicator decreased by 0.6% YoY after the decrease by 0.1% YoY in the previous month. Analysts had expected decline by 0.4% YoY. Today, the instrument is trading in both directions. Investors are awaiting speeches by ECB representatives, Yves Mersch and Luis de Guindos, as well as the publication of information on the last ECB meeting on monetary policy.

GBP/USD

GBP ended Wednesday trading with flat dynamics against USD. During the day, the instrument was moderately reduced, but by the end of the afternoon session, it managed to fully recoup. Wednesday's macroeconomic background remained fairly calm, so the previous drivers were in the spotlight of investors. Markets are following the election campaign in the UK, responding positively to a series of opinion polls that revealed a slight conservative advantage. The election to the British Parliament should be held in mid-December. If Boris Johnson's party wins the election, the Parliament will probably have time to ratify the agreement with the EU, and the UK will be able to leave the union, bypassing the so-called hard Brexit.

AUD/USD

AUD showed a moderate decline against USD on Wednesday, reversing downwards after quite active growth the day before. The pressure on the instrument again comes from the uncertainty surrounding US-China trade negotiations, which seem to be at an impasse. Donald Trump said that if the signing of the deal breaks, then in December, import duties on Chinese goods may be raised even higher than previously planned values. In addition, the complication of relations between the countries was facilitated by the meeting of the US Senate, which approved bills supporting civil unrest in Hong Kong. Beijing has already commented on the decisions taken by the Senate, calling them "interference in China's domestic policy".

USD/JPY

USD showed a slight increase against JPY on Wednesday, but again returned to decline during today's Asian session. The emergence of the uptrend yesterday was due to weak macroeconomic statistics from Japan. Japanese exports went down by 9.2% YoY in October after the decline by 5.2% YoY in the previous month. Analysts had expected decline of 7.6% YoY. Imports for the same period decreased by 14.8% YoY after a decrease of 1.5% YoY in September. Forecasts suggested a decrease of 16% YoY. Support for the Japanese currency, in turn, is provided by an increase in demand for safe assets amid worsening prospects for trade negotiations between the US and China, a breakdown of which can lead to a further decline in the global economy.

Oil

Oil prices rose significantly on Wednesday, reacting to the publication of EIA Crude Oil Inventories report, according to which, the volume of oil reserves for the week ending November 15 increased by 1.379 million barrels after an increase of 2.219 million barrels over the past period. Analysts had expected an increase of 1.543 million barrels. At the same time, Cushing Crude Oil Inventories fell by 2.3 million barrels to 44.2 million barrels, while gasoline reserves increased by 1.8 million barrels to 220.8 million barrels. The volume of oil production in the United States did not change compared to last week and amounted to 12.800 million barrels per day. Additional support for oil quotes was provided by another aggravation of the situation in the Middle East. Another attack on oil tankers occurred in the Persian Gulf, after which the US Abraham Lincoln aircraft carrier strike group sailed through the Strait of Hormuz.

 

[MikhailLF]

Morning Market Review
2019-11-22 08:51 (GMT+2)
EUR/USD

EUR is slightly strengthening against USD during the Asian session, having added 0.06% till the present moment. Insignificant support for the instrument is provided by rather weak positions of the American currency, which came under pressure after the publication of ambiguous data from the USA the day before. Initial Jobless Claims for the week ending November 15 remained at the level of 227K, with a forecast of a decline to 219K. Continuing Jobless Claims rose from 1.692M to 1.695M, while analysts expected a reduction to 1.685M. During the day, European investors expect the publication of statistics from Germany and the euro area on GDP dynamics and levels of business activity. In addition, the market is waiting for the speech of the new ECB Governor Christine Lagarde, who can make significant changes to the policy of the European regulator.

GBP/USD

During the Asian session, the pair is showing weak growth, slightly strengthening by 0.08%. The focus on investors remains on the situation around the US-Chinese trade negotiations, which may end in failure. The day before, the PRC noticeably increased criticism of the US after the approval of a bill in the US Senate on the possible restriction of China’s trade preferences in the USA in case of violation of human rights and freedoms in Hong Kong. Negative forecasts on trade negotiations suggest that in mid-December, the United States will introduce new import duties on Chinese goods, which will contribute to the escalation of tension. In the afternoon, investors expect publication of statistics from the UK on the Manufacturing and Services PMI for November.

AUD/USD

AUD is showing slight growth against USD during today's Asian session, adding about 0.05%. The instrument is trying to correct after an active decline for two consecutive sessions; however, the Australian dollar has little fundamental support. Investors are focused on Friday's statistics on business activity indexes. The Commonwealth Bank Services PMI in November showed a decrease from 50.1 to 49.5 points. The indicator turned out significantly worse than its forecasts, which assumed its growth to 53.5 points. Manufacturing PMI over the same period fell from 50 to 49.9 points, which was 0.1 points better than market expectations. Composite PMI in November corrected down from 50 to 49.5 points, entering the stagnation zone.

USD/JPY

USD showed ambiguous dynamics of trading against JPY during the Asian session. The instrument practically did not depart from its opening level at around 108.62. The yen ignored moderately optimistic macroeconomic data from Japan. Inflation Rate Ex-Food and Energy rose in October by 0.7% YoY, accelerating from the previous 0.5% YoY. Forecasts suggested an increase of 0.5% YoY. Jibun Bank Manufacturing PMI in November rose from 48.4 to 48.6 points, slightly not reaching the expected values of 48.7 points.

XAU/USD

Gold is stable during the Asian session and is trading at the level of opening at 1463.72. The day before, quotations showed moderate negative dynamics, which was caused by the appearance of optimistic news around the process of trade negotiations between China and the United States. It became known that Beijing invited a team of American negotiators to a new round of discussion of the agreement, despite continuing disagreements. Meanwhile, quotes are supported by the situation surrounding ongoing protests in Hong Kong. The United States have passed a series of bills that support civil protest and seek to exert pressure on China, recalling the need to respect human rights.

 

[MikhailLF]

Morning Market Review
2019-11-25 08:48 (GMT+2)
EUR/USD

EUR shows flat dynamics during today's Asian session, slightly correcting after a sharp decline at the end of last week. The reason for the negative dynamics was the weak macroeconomic statistics from Europe. Markit Composite PMI in the euro area fell from 50.6 to 50.3 points in November, while investors expected the indicator to rise to 50.9 points. At the same time, Services PMI decreased from 52.2 to 51.5 points, while Manufacturing PMI rose from 45.9 to 46.6 points, which was better than market expectations of 46.4 points. In addition, the market responded to Christine Lagarde's first appearance as the new ECB President. Lagarde avoided any details in her speech, but noted the need for a "revision of European monetary policy". In addition to applying traditional measures, the head of the European regulator plans to bet on stimulating investment in business and increasing productivity.

GBP/USD

GBP is growing slightly against USD today, opening with a small gap upwards after a sharp decline last Friday. Currently, the pound is trading near 1.2844, adding about 0.07%. GBP is still under pressure from the macroeconomic statistics from Great Britain published on Friday. Markit Manufacturing PMI fell from 49.6 to 48.3 points in November against a forecast of a decline of only to 49 points. Markit Services PMI corrected from 50 to 48.6 points with a neutral outlook. Meanwhile, investors were optimistic about the statement by British Prime Minister Boris Johnson, who presented the Conservative Party’s election manifesto over the weekend. In addition, Johnson plans to send a draft agreement with the EU to Parliament by December 25. Early parliamentary elections are to be held in the country on December 12.

AUD/USD

AUD is showing moderate growth against USD, correcting after the "bearish" end of the past week. To date, the pair has reached 0.6794, adding about 0.13%. The instrument is supported once again by a changing trend in sentiments around US-Chinese trade negotiations. The market was inspired after a series of optimistic comments by Donald Trump that the parties are close to concluding an agreement. However, the date and place of signing the final agreement are still not defined, and differences remain between Washington and Beijing. A more confident growth of the instrument is hindered by rather weak macroeconomic statistics published in Australia. The data on the PMI published last Friday turned out to be worse than the average market forecasts. In particular, Commonwealth Services PMI fell from 50.1 to 49.5 points in November, with a very optimistic forecast for growth to 53.5 points.

USD/JPY

USD is growing paired with JPY, updating local highs of November 19 at 108.79 (+0.1%). The growth of the instrument is due to the publication of good macroeconomic statistics from the US last Friday, as well as the growth of optimistic sentiment regarding the possible conclusion of a trade agreement between the US and China. The US Markit Manufacturing PMI grew from 51.3 to 52.2 points in November against the forecast of increase to 51.5 points. Services PMI rose from 50.6 to 51.6 points with the forecast of 51 points. During the day, investors expect publication from Japan of data on the dynamics of coinciding and leading indicators, but it is unlikely that these indicators will noticeably affect the dynamics of the instrument.

XAU/USD

Gold prices are falling slightly during today's Asian session, trading near 1461.24 (–0.04%). Reduction in quotes was due to the growth of optimism regarding the possibility of concluding a trade agreement between the United States and China. Commenting on the current situation, Donald Trump noted that countries are "very close" to the conclusion of the agreement, but there are still no approximate dates. Strengthening the position of the American currency also contributes to the development of corrective moods in the instrument against the background of the publication of good macroeconomic statistics on PMI in the USA in November.

 

[MikhailLF]

Morning Market Review
2019-11-26 08:38 (GMT+2)
EUR/USD

EUR again shows ambiguous dynamics during today's Asian session, trading near the opening level of 1.1012. The euro remains under pressure against the backdrop of a growing dollar, which finds support among the improved prospects for a trade agreement between the United States and China. It became known that the PRC will nevertheless raise fines for violating the law on intellectual property rights, which previously served as a very significant obstacle to the dialogue between the two countries. However, this does not mean that the parties are ready to sign the final agreement, although there is not much time left before the date of a possible increase in import duties on the part of the United States. During the day, investors expect speeches by representatives of the ECB, who will comment on the results of the first speech by Christine Lagarde as President of the ECB.

GBP/USD

GBP remains relatively stable during the Asian session, slightly correcting (–0.05%) after moderate growth the day before. Support for the pound, as before, is provided by forecasts regarding the upcoming elections to the British Parliament. According to several opinion polls, the Conservative Party has good chances to get an overwhelming number of seats in Parliament, which will allow it to ratify the existing agreement with the EU. Currently, more than 40% of voters support Boris Johnson, while slightly less than 30% are ready to vote for the Labor Party. CBI Distributive Trades Survey provided slight support to the instrument yesterday. In November, sales fell by 3% MoM after a decline of 10% MoM in the previous month. Analysts had expected negative dynamics to remain at –0.10% MoM.

NZD/USD

NZD is showing slight growth against USD during today's Asian session. Currently, the pair is trading at 0.6420, adding about 0.21%. At the opening of the session, there was a decline to 0.6404, caused by the growth of correctional sentiment in favor of the US currency. Active support for NZD is provided by statistics from New Zealand. In Q3 2019, Retail Sales grew by 1.6% QoQ after growing by 0.2% QoQ in the previous quarter. The indicator also turned out better than its forecasts (+1.2% QoQ). Core Retail Sales rose by 1.8% QoQ with a forecast of +1.5% QoQ.

USD/JPY

USD showed strong growth against JPY at the opening of today's Asian session, rising to 109.19 and updating the local highs of November 12. The "bullish" activity on the instrument has significantly decreased, but the dollar retains its advantage, adding about 0.04%. The US currency is supported by news regarding US-Chinese trade negotiations. Investors believe that the parties will have time to agree before the deadline for the next increase in import duties. China is expected to increase fines for violation of intellectual property rights. In turn, support for the yen during the Asian session was provided by the data on Corporate Services Price Index in Japan. In October, prices rose sharply by 2.1% YoY after a slight increase of 0.5% YoY a month earlier, which may indicate a gradual acceleration of inflation in the country.

XAU/USD

Gold prices are stable during today's Asian session and are located near local lows of November 12 (at 1451.34). In general, the instrument maintains a moderate downtrend that has formed in the middle of last week. Pressure on gold quotes is exerted by growing optimism about the prospects for a trade agreement between the United States and China. According to the media, Washington and Beijing are "very close" to the conclusion of a preliminary agreement, but there is still little information. In addition, the situation with the upcoming UK parliamentary elections, which are expected to contribute to the early conclusion of a trade deal with the EU, also contributes to increased demand for risky assets.

 

[MikhailLF]

Morning Market Review
2019-11-27 08:53 (GMT+2)
EUR/USD

EUR is moderately declining against USD in today's Asian session, testing the level of 1.1010 (–0.11%). Some pressure on the euro is exerted by macroeconomic statistics from the USA published the day before. However, it is worth noting that the market is currently quite thin, and investors are in no hurry to open new positions due to the upcoming Thanksgiving in the United States on Thursday. During the day, traders expect publication of German Import Price Index for October, as well as statements by ECB representative Philip Lane. The main attention of the market will be focused on American data on the annual GDP growth rates for Q3 2019 and the dynamics of Personal Income and Expenses for October.

GBP/USD

GBP is slightly declining during the Asian session, developing a "bearish" momentum formed the day before. The instrument is trading at 1.2854, losing about 0.05%. The pound is retreating amid a rising dollar; however, a more confident downtrend is hindered by positive expectations about the December parliamentary elections. According to a public opinion poll, the Conservative party, led by British Prime Minister Boris Johnson, has good chances of winning, which will allow it to ratify the existing deal with the EU with minimal resistance in the future. Slight pressure on the pound during today's Asian session is exerted by Retail Prices data from the UK. BRC Shop Price Index in October fell by 0.5% YoY, accelerating the fall from the previous –0.4% YoY.

NZD/USD

NZD is stable against USD during today's Asian session, trading near its weekly local high at 0.6432. The development of the "bullish" trend was supported by good macroeconomic data on the dynamics of Retail Sales from New Zealand. During the Asian session, moderate support for the pair is provided by data on New Zealand Exports. At the end of October, Exports grew from 4.36B to 5.03B dollars, which turned out to be better than the average market expectations. Imports for the same period also increased from 5.68B to 6.05B dollars. The Trade Deficit in October amounted to –1.013B dollars compared to the previous –1.319B dollars, while the forecast assumed the deficit to increase to the level of –1.621B.

USD/JPY

USD is strengthening against JPY during today's Asian session, adding about 0.08%. The dollar is supported by optimistic news regarding the process of trade negotiations between the US and China, which contribute to increased demand for risky assets. The day before, the Ministry of Commerce of China reiterated that telephone calls between the parties "have made progress in resolving a number of issues". However, as before, no specific information was received, and the market can only guess when exactly Washington and Beijing plan to sign a preliminary trade agreement. With the opening of the American session, investors expect the publication of macroeconomic statistics from the United States. Among other things, the market expects the release of data on the dynamics of Personal Consumption, Pending Home Sales, annual data on GDP for Q3 2019, and statistics on Personal Expense and Income for October.

XAU/USD

Gold prices are consolidating during today's Asian session, correcting slightly after moderate growth the day before. Quotes are located at around 1458.83, losing about 0.22%. The instrument was supported by uncertain prospects around the US-Chinese trade negotiations, despite restrained optimistic comments by officials. In addition, gold rose in response to the publication of disappointing macroeconomic statistics on Consumer Confidence in the United States. The market also reacted to Jerome Powell's speech at the Chamber of Commerce. During the annual dinner, the head of the Fed was rather optimistic about the economic prospects of the United States, which was perceived by investors as a refusal to further raise rates in the near future.

 

[MikhailLF]

Morning Market Review
2019-11-28 08:47 (GMT+2)
EUR/USD

EUR is slightly strengthening against USD during today's Asian session, adding about 0.02%. The instrument continues trading near 1.1000, which was actively tested for a breakdown the day before. Ambiguous macroeconomic statistics from the USA, published on Wednesday, continue to exert moderate pressure on the euro. Annual data on US GDP in Q3 2019 showed an increase of 2.1% YoY, accelerating from the previous 1.9% YoY. Analysts had expected the same growth dynamics to maintain (+1.9% YoY). Goods Orders Non Defense Ex Air in October rose sharply by 1.2% MoM after a decline of 0.5% MoM last month. Analysts had expected decline of 0.3% MoM. Chicago PMI in November rose from 43.2 to 46.3 points, which turned out to be slightly worse than forecasts about growth to 47 points. During the day, investors expect the publication of statistics from the euro area on the level of business sentiment. Special attention should be paid to the data from Germany on the November dynamics of Consumer Prices.

GBP/USD

GBP is growing during the Asian session, adding about 0.15%. The instrument develops an upward momentum formed the day before under the influence of the expectations of the publication of an updated opinion poll from YouGov. Traditionally, forecasts of this kind have a strong influence on the markets, since they enjoy a fairly high trust. According to a published forecast, in the upcoming elections to the British Parliament, 43% of the seats may be taken by candidates from the Conservative Party. The Labor Party can tentatively only get 32% of the seats, which provides Prime Minister Boris Johnson with a confident majority in parliament.

AUD/USD

AUD is showing an active decline during today's Asian session, trading near local lows of October 17 (0.6758). The instrument continues to develop a "bearish" impulse, formed yesterday when the Australian dollar was under pressure from publications from Westpac. According to Westpac Banking Corp. representative, the RBA may lower its interest rate twice until mid-2020, and is also very likely to initiate a quantitative easing program. Slight pressure on the instrument during the Asian session is exerted by data from Australia. Private New Capital Expenditure in Q3 2019 decreased by 0.2% QoQ after a decrease of 0.5% QoQ in the previous quarter. The indicator turned out to be worse than its forecast, which assumed a decrease of only 0.1% QoQ.

USD/JPY

USD declines slightly against JPY during today's Asian session, losing about 0.09%. The instrument is corrected from local highs at 109.59, updated the day before (highs of May 31). The development of correctional dynamics for the instrument is facilitated by technical factors that are exacerbated by closed markets in the United States due to Thanksgiving. At the same time, published macroeconomic statistics from Japan hinder the development of a more confident decline. Japanese Retail Sales in October showed a decrease of 14.4% MoM after a 7.2% MoM growth last month. Analysts had expected zero dynamics. In annual terms, the decline in sales was –7.1% YoY after an increase of 9.2% YoY last month. Forecasts suggested a decrease of 4.4% YoY.

XAU/USD

Gold prices rise slightly during today's Asian session, adding about 0.09%. The instrument is recovering after a moderate decline yesterday, which was due to the publication of a number of good macroeconomic indicators from the United States. In particular, investors were optimistic about the data on the dynamics of US GDP for Q3 2019, which showed an increase from the previous 1.9% YoY to 2.1% YoY. Optimistic forecasts regarding the outcome of the upcoming parliamentary elections in the UK also provide additional pressure on gold. According to several opinion polls, the Conservative Party of Great Britain is gaining a confident majority of seats in parliament, which will allow Boris Johnson to ratify the existing agreement with the EU with minimal resistance and hold Brexit before the next deadline.

 

[MikhailLF]

Morning Market Review
2019-11-29 08:40 (GMT+2)
EUR/USD

EUR showed a slight increase against USD during the Asian session, adding about 0.02%. Market activity remains low due to stock exchanges closed in the United States due to Thanksgiving. Investors remain focused on the situation around US-China trade negotiations, as well as the publication of macroeconomic statistics from Europe on Thursday. European data had a mixed effect on the position of the instrument. Business Climate indicator in November fell by 0.23 points after falling by 0.2 points in the previous month. Analysts expected the decline of 0.14 points. At the same time, Business and Consumer Survey for the same period increased from 100.8 to 101.3 points against the forecast of growth to 101.0 points. The euro was under pressure from the German data. German Consumer Price Index in November showed a sharp decrease of 0.8% MoM after an increase of 0.1% MoM a month earlier. Experts expected the appearance of negative dynamics at the level of –0.6% MoM.

GBP/USD

GBP shows flat dynamics during today's Asian session, trading near 1.2910. The instrument receives support from optimistic forecasts regarding the outcome of the December parliamentary elections; however, market activity remains low. According to a number of opinion polls, the Conservative Party can win the most confident victory in the last 30 years, ensuring unhindered ratification of the agreement with the EU. Some pressure on the pound during the Asian session is exerted by weak data from the UK. GfK Consumer Confidence index in November showed a decrease of 14 points, which coincided with the forecasts. During the day, investors expect publication of statistics on Consumer Credit and Mortgage Approvals for October.

NZD/USD

NZD is trading slightly upwards during today's Asian session, adding about 0.1%. The growth of the instrument is facilitated by technical factors that are exacerbated by closed due to Thanksgiving markets in the United States. At the same time, the news from the USA turns out to be alarming. Donald trump signed two new laws aimed at supporting civil protest in Hong Kong. The first law limits the supply of weapons to disperse the protesters, and the second one gives the United States the right to evaluate and confirm China's observance of Hong Kong's special status. Investors fear that these steps may complicate the already tense situation with the negotiations. In addition, Washington may introduce new import duties against China in December if the deal is not signed. Slight support for the instrument on Friday is provided by the data on Consumer Confidence from New Zealand. According to data from Roy Morgan, November Consumer Confidence index rose from 118 to 121 points.

USD/JPY

USD is declining during today's Asian session, losing about 0.05% and trading around 109.45. Conflicting macroeconomic statistics from Japan has influence on the instrument on Friday. Tokyo Core CPI rose in November from 0.5% YoY to 0.6% YoY, which was in line with expectations. At the same time, Tokyo CPI accelerated in November from 0.4% YoY to 0.8% YoY. Meanwhile, investors are disappointed with the dynamics of industrial production. In October, Industrial Production fell by 4.2% MoM after rising by 1.7% MoM in September. Analysts had expected the decline by 2.1% MoM. In annual terms, the decline in production was –7.4% YoY after an increase of 1.3% YoY last month. Forecasts suggested an increase of 1.9% YoY.

Gold

Gold prices show moderate growth during the Asian session, adding about 0.17% and testing level of 1459.00 for the breakdown. The instrument receives moderate support amid the adoption of new bills in the United States aimed at supporting protesters in Hong Kong. Investors fear that Donald Trump’s new steps in this direction could significantly complicate the process of signing a trade agreement, which the parties have been unsuccessfully trying to conclude for several months.

 

[MikhailLF]

Morning Market Review
2019-12-02 08:43 (GMT+2)
EUR/USD

EUR is weakening against USD during the Asian session, losing about 0.02%. The instrument is slightly correcting after growth at the end of last week, which allowed the euro to consolidate at a local high since November 25 at 1.1027. The strengthening of EUR last Friday was facilitated by the moderately optimistic macroeconomic statistics from the euro area. The Eurozone Core Consumer Price Index rose by 1.3% YoY in November after rising by 1.1% YoY a month earlier. Analysts had expected growth by 1.2% YoY. Consumer Price Index for the same period accelerated from +0.7% YoY to +1.0% YoY, which also exceeded expectations of +0.9% YoY. Unemployment Rate in October expectedly decreased from 7.6% to 7.5%. During the day, investors expect publication of data on the EU Manufacturing PMI for November, as well as a speech by ECB President Christine Lagarde.

GBP/USD

GBP opened today with a moderate downward gap against USD and is currently trading near 1.2910, losing about 0.16%. The opening shifts were caused by investors returning to the market after the holidays in the USA and the publication of positive macroeconomic statistics from China on Saturday, while the general news background did not change much. The pound remains under pressure from uncertainty over the upcoming British parliamentary elections, despite quite clear forecasts. According to numerous opinion polls, the Conservative Party of Great Britain can get a confident majority, which will allow Boris Johnson to ratify the agreement with the EU and put an end to the fairly protracted history with Brexit. Today, investors expect the publication of statistics on the UK Markit Manufacturing PMI in November. After the opening of the American session, similar indices will be released in the United States.

AUD/USD

AUD is showing moderate growth against USD, gaining 0.2%. The growth of the instrument is facilitated by the publication of strong data from China, while Australian statistics are contradictory. Chinese Caixin Manufacturing PMI in November rose from 51.7 to 51.8 points against the forecast of a decrease to 51.4 points. Australian data, by contrast, indicated a decrease in Commonwealth Bank Manufacturing PMI from 50 to 49.9 points. AiG Manufacturing PMI in November fell sharply from 51.6 to 48.1 points. Building Approvals issued in October fell by 8.1% MoM after a 7.2% MoM growth in the previous month. Analysts had expected decline by 0.4% MoM. In annual terms, the indicator decreased from –17% YoY in September to –23.6% YoY in October. Tomorrow, investors expect the publication of the RBA decision on the interest rate. It is predicted that the regulator will not change the parameters of monetary policy and will keep the rate at the same level of 0.75%.

USD/JPY

USD is showing moderate growth against JPY during today's Asian session, adding about 0.19% and updating local highs of May 30 (109.71). The growth of the dollar is facilitated by a good demand for risk, as well as moderately optimistic signals from the US economy. In addition, investors are responding to the situation around US-Chinese trade negotiations. After Trump signed bills to support protesters in Hong Kong last Wednesday, markets expected a response from Beijing, but there was no reaction, which may indirectly indicate China’s interest in signing the first stage of the agreement in the near future. Additional pressure on the yen on Friday was exerted by data on industrial production. In October, the indicator crashed by 4.2% MoM and 7.4% YoY, which turned out to be significantly worse than market expectations of –2.1% MoM and +1.9% YoY.

XAU/USD

Gold prices are falling during today's Asian session, losing 0.3%. The instrument is correcting after active growth at the end of last week, due to the correction of the US currency. Moderate support for gold continues to be provided by the uncertain situation surrounding US and Chinese trade negotiations, especially after the adoption of a number of bills in the US aimed at supporting protesters in Hong Kong. However, to date, China has not taken any retaliatory measures that could significantly worsen the prospects for signing a preliminary trade agreement.

 

[MikhailLF]

Morning Market Review
2019-12-03 08:37 (GMT+2)
EUR/USD

EUR is stable against USD during today's Asian session, consolidating near local highs (1.1088), updated the day before, when the instrument managed to show steady growth. The positive dynamics of the instrument was facilitated by strong data on business activity in Europe, as well as positive statistics from China, which somewhat eased concerns about a further slowdown in the global economy. Manufacturing PMI of the euro area in November rose from 46.6 to 46.9 points with a neutral forecast. German Manufacturing PMI in November rose from 43.8 to 44.1 points, which also turned out to be better than market expectations. Today, investors are awaiting the publication of European Producer Price Indices for October and a speech by ECB representative Benoit Coeure.

GBP/USD

GBP shows flat dynamics during today's Asian session, being located near its local highs, updated the day before. The growth of the instrument is facilitated by macroeconomic statistics released on Monday. Markit Manufacturing PMI in the UK in November rose from 48.3 to 48.9 points, which turned out to be better than the neutral forecast. At the same time, US data turned out worse than expected. ISM Manufacturing PMI in November declined from 48.3 to 48.1 points with the forecast of growth to 49.2 points. ISM Manufacturing Prices in November rose from 45.5 to 46.7 points, not reaching the forecast of 47 points.

AUD/USD

AUD is showing strong growth during today's Asian session, adding about 0.22%. The instrument is supported by the RBA decision on the interest rate. As expected, the regulator did not change the parameters of monetary policy, maintaining the rate at 0.75%. AUD is also supported by strong data from China and the rather vulnerable position of USD, which is again under pressure from uncertain prospects. The day before, Donald trump introduced import duties on steel and aluminum from Brazil and Argentina, and also made harsh criticism of the Fed, urging to adjust the high exchange rate of the national currency.

USD/JPY

USD is correcting against JPY during today's Asian session, gaining about 0.23%. The growth of the instrument replaced the confident correction yesterday, as a result of which the dollar retreated from the local highs of May 30. Contradictory macroeconomic statistics published in the USA continue to exert pressure on the pair. Markit Manufacturing PMI rose from 52.2 to 52.6 points in November with a neutral forecast. ISM Manufacturing PMI in November declined from 48.3 to 48.1 points with the forecast of growth to 49.2 points.

XAU/USD

Gold prices are stable during today's Asian session and are located near the opening level of 1463.84. The instrument is supported by weak macroeconomic statistics from the USA, as well as the continuing uncertainty surrounding US-Chinese trade relations. The PRC took retaliatory sanctions against the American Human Rights Watch, which actively supports civil protests in Hong Kong. In addition, Beijing has banned the mooring of US ships in Hong Kong. It is highly likely that the parties will not be able to resume full-scale trade negotiations before the end of this year. In December, markets also fear a possible increase in import duties on Chinese goods, which could offset all the progress already achieved in the negotiations.

 

[MikhailLF]

Morning Market Review
2019-12-04 08:42 (GMT+2)
EUR/USD

EUR shows a slight decline against USD during today's Asian session, losing about 0.04%. The pair continues to consolidate near local highs at the level of 1.1092, updated the day before amid conflicting external factors. Moderate support for the euro is provided by positive macroeconomic indicators on Manufacturing PMIs, which were released on Monday. Tuesday's data turned out to be significantly more restrained. Producer Price Index in October showed an increase of 0.1% MoM, which coincided with the dynamics of the previous month. In annual terms, production inflation fell by 1.9% YoY after falling by 1.2% YoY in September. During the day, investors expect the publication of European Services PMI, which will later be compared with similar statistics from the United States.

GBP/USD

GBP is trading with multidirectional dynamics against USD during today's Asian session, located near the opening level of 1.2990. Moderate support for the instrument is still provided by the expectation of parliamentary elections in the UK on December 12, where, according to opinion polls, the Conservative Party should win a landslide victory. The victory of the conservatives will allow Boris Johnson to ratify the agreement with the EU and close the urgent issue once and for all. However, analysts are already discussing the future of Great Britain outside the European Union. In particular, it is noted that if London is unable to agree with the EU on free trade, the UK economy will suffer significantly, and the rate may adjust to 1.15 dollars per pound.

AUD/USD

AUD shows negative dynamics during today's Asian session, correcting by about 0.26%. The decline in the instrument proceeds amid the publication of conflicting macroeconomic statistics from Australia. Australian GDP in Q3 2019 increased by 0.4% QoQ after a growth of 0.6% QoQ in the previous quarter. The indicator came out worse than its forecast for growth of 0.5% QoQ. In annual terms, the Australian economy accelerated from 1.4% YoY to 1.7% YoY, meeting the expectations of investors. Commonwealth Services PMI rose in November from 49.5 to 49.7 points with a neutral outlook. AiG Services PMI in November fell from 54.2 to 53.7 points.

USD/JPY

USD continues to develop a downward trend in trading against JPY, retreating to new local lows since November 22. The pair has been losing about 0.07% since the opening of today's trading session, retreating amid the publication of moderately optimistic data from Japan. Jibun Bank Manufacturing PMI in November rose from 49.7 to 50.3 points, returning to the surplus zone after a sharp decline in October. Investors had expected growth to 50.4 points. Additional support for the Japanese currency is provided by the deteriorating prospects of concluding a trade agreement between the United States and China, after Donald Trump noted that the agreement could be signed closer to the presidential election in 2020. In addition, the US president still intends to raise import duties on Chinese imports for USD 160 billion in total from December 15.

XAU/USD

Gold prices are stable during today's Asian session, consolidating near local highs (1481.44), updated the day before. The growth of quotations yesterday was facilitated by investors' flight from risks, after the United States introduced higher tariffs on imports of steel and aluminum from Brazil and Argentina. In addition, investors reacted negatively to the possible postponement of the signing of a trade agreement between the United States and China to November 2020, when the US presidential election will be held. Obviously, this is too long for such an issue, especially considering the speed of change of events in the modern world. Moreover, on December 15, Donald Trump again threatened to increase import duties on Chinese goods, which could put an end to all the progress that had been achieved over a long time.

 

[MikhailLF]

Morning Market Review
2019-12-05 09:48 (GMT+2)
EUR/USD

EUR shows a slight increase against USD during today's Asian session, gaining about 0.04%. The instrument is recovering somewhat after the ambiguous dynamics yesterday, which, at the same time, led to the updating of local highs from November 5. The euro was supported by strong data from the euro area. Markit Services PMI in the euro area rose in November from 51.5 to 51.9 points with a neutral forecast. Markit Composite PMI for the same period strengthened from 50.3 to 50.6 points, which also turned out to be higher than the projected values of 50.3 points. Separately, it is worth highlighting data from Germany. Services PMI rose from 51.3 to 51.7 points in November (with a forecast of 51.3 points), while the Composite PMI rose from 49.2 to 49.4 points, which also turned out to be better than forecasts of 49.2 points.

GBP/USD

GBP showed noticeable growth against USD yesterday, updating record highs of May 7. "Bullish" trend can be traced during today's Asian session; however, its activity is noticeably lower. GBP adds about 0.07%. The growth of the British currency is supported by the expectations of the Conservative Party winning the upcoming early parliamentary elections in the UK on December 12. Additional support for the instrument on Wednesday was provided by optimistic data on business activity in the UK services sector. November Markit PMI rose from 48.6 to 49.3 points with a neutral forecast.

AUD/USD

AUD shows negative dynamics during today's Asian session, declining by about 0.24%. The instrument responds to the publication of disappointing macroeconomic statistics from Australia. Australia's Retail Sales in October showed zero dynamics after rising by 0.2% MoM in September. Analysts had expected acceleration of the increase to 0.3% MoM. Exports from Australia in October showed a 5% decline after rising by 3% a month earlier. Imports for the same period showed zero dynamics after an increase of 3% in September. Such a significant drop in exports led to a marked decrease in the surplus of the trade balance. In October, the balance amounted to 4.5B Australian dollars after 7.2B in September. Analysts had expected a balance surplus of AUD 6.1B.

USD/JPY

USD shows ambiguous trading dynamics during today's Asian session, consolidating after corrective growth the day before, thanks to which the US currency managed to retreat from its local lows of November 21. USD strengthened its position, despite the appearance of ambiguous macroeconomic statistics from the US on Wednesday. ISM Services PMI in November fell from 54.7 to 53.9 points, which turned out to be noticeably worse than market expectations of 54.5 points. At the same time, the Composite PMI for the same period increased from 51.9 to 52 points. An additional negative point was the publication of the ADP Nonfarm Employment Change. In November, the figure rose by 67K new jobs after an increase of 121K in the previous month. Analysts had expected a much more significant increase of 140K.

XAU/USD

Gold prices rise slightly during today's Asian session, adding about 0.05%. The instrument is slightly corrected after predominantly negative trading yesterday, which formed in response to the news about US-Chinese trade negotiations. Bloomberg reported that the parties are close to agreeing on the volumes of tariffs that are proposed to be canceled as part of the first phase of the trade agreement. The deal itself, according to Bloomberg, may be concluded before December 15.

 

[MikhailLF]

Morning Market Review
2019-12-06 08:46 (GMT+2)
EUR/USD

EUR shows ambiguous trading against USD during today's Asian session, consolidating after strong growth, which, however, failed to lead to the renewal of previous local highs at 1.1115. The European statistics published on Thursday, which turned out to be not the most successful, remain in the spotlight of investors. The EU GDP in Q3 2019 increased by 0.2% QoQ and 1.2% YoY, which coincided with the data of the previous period and the forecasts. At the same time, Retail Sales in October fell by 0.6% MoM after a decline of 0.2% MoM in September. Investors expected a reduction of 0.3% MoM. In annual terms, sales slowed down from 2.7% YoY to 1.4% YoY, which also turned out to be noticeably worse than market expectations of 2.2% YoY. Employment Change in Q3 2019 increased by 0.1% QoQ and 0.9% YoY, which coincided with the dynamics in the previous quarter.

GBP/USD

GBP is stable against USD during today's Asian session, trading near local highs of May 6. The pound confidently strengthened during the last three trading sessions, which was caused by not the strongest positions of the American currency, and also by the growth of confidence in the Conservative Party's victory in the British parliamentary elections on 12 December. This will allow the Parliament to ratify the deal with the EU and implement Brexit, meeting the new deadlines by the end of January 2020. During the day, investors expect the publication of the November report on the US labor market, which could trigger the appearance of correctional dynamics in favor of the US currency.

AUD/USD

AUD is strengthening against USD during today's Asian session, adding about 0.14%. The instrument is recovering after the decline yesterday caused by the publication of contradictory macroeconomic statistics from Australia. Australian Exports fell by 5% in October after rising 3% a month earlier. Imports for the same period showed zero dynamics after an increase of 3% in September. Such a significant decline in exports led to a decrease in the trade surplus in October from 6.85B to 4.50B Australian dollars with a forecast of 6.10B. The correctional growth of the instrument during the Asian session is not hindered by the publication of weak AiG Construction Index, which continued to decline in November and fell from 43.9 to 40 points, which turned out to be worse than the average expectations.

USD/JPY

USD is declining against JPY during the Asian session, losing about 0.07%. The yen is again in demand amid growing uncertainty around US-Chinese trade negotiations. Donald Trump’s restrained statements that “the negotiations are proceeding well” weakly support the market, which is waiting for December 15, when the US may increase import duties on Chinese goods, which can offset all the progress achieved by the parties. Published macroeconomic statistics from Japan on Friday does not support the yen. Average Cash Earnings in October increased by 0.5% YoY, coinciding with the data for the previous month. Analysts had expected a significant increase of 1.1% YoY. Household Spending in October fell sharply by 5.1% YoY after growth by 9.5% YoY in the previous month. Experts expected a decrease of 3% YoY.

XAU/USD

Gold prices are stable during today's Asian session, trading near 1475.00. Gold quotes have changed little recently since investors expect the situation to develop in a trade conflict between the United States and China. Earlier this week, information appeared that the conclusion of the agreement may have to be postponed to November 2020, when the next presidential election will be held in the United States. Trump later reiterated that “negotiations are going well,” and moderate optimism gradually began to return to the markets. However, there is little time left until December 15, and new import duties, if they are introduced by the USA, will almost certainly put an end to the current progress in the negotiations and everything will have to be started from scratch.

 

[MikhailLF]

Morning Market Review
2019-12-09 08:48 (GMT+2)
EUR/USD

EUR is stable (–0.03%) against USD on Monday, consolidating after a sharp decline last Friday. EUR showed an active decline on Friday, retreating from its local highs and the level of 1.1115, after the publication of a strong report on the US labor market, which in many respects exceeded expectations. In November, the US economy created 266K new jobs with a forecast of growth of only 180K. Last month, the growth rate was 156K (revised upwards from the previous 128K). Average Hourly Earnings increased by 3.1% YoY, which is slightly worse than previous data of 3.2% YoY (revised from +3% YoY). November Unemployment Rate unexpectedly dropped from 3.6% to 3.5%. During the day, investors expect publication of statistics on Imports and Exports from Germany for October.

GBP/USD

GBP is trading with a slight increase (+0.02%) against USD during today's Asian session, located not far from its local highs (1.3165), updated last Thursday. Trading activity in the British currency remains restrained, as traders are in no hurry to open new positions in anticipation of early parliamentary elections, which will be held at the end of this week. These elections are expected to decide the fate of Brexit, as the market is confident in the victory of the Conservative Party. In addition, investors are waiting for news regarding the process of trade negotiations between the United States and China. Next Sunday, according to Donald Trump, import duties on Chinese goods can be raised again if an agreement between the countries is not signed.

AUD/USD

AUD is trading near the opening level (0.6829) against USD during today's Asian session. Investors are in no hurry to open new trading positions, preferring to wait for new drivers to appear at the market. Monday's macroeconomic background is rather scarce, but on Tuesday there will be a lot of interesting statistics from Australia and China. On Wednesday, the United States will be in the spotlight with the publication of November statistics on Consumer Inflation and the Fed meeting. In the meantime, investors are taking a lead from the publication of a strong US labor market report for November last Friday. Nonfarm Payrolls in November increased by 266K after the growth by 156K in the previous month. Analysts had expected an increase of 180K.

USD/JPY

USD is trading flat against JPY during today's Asian session, consolidating after falling last week. The optimism from the November report on the labor market, which was released last Friday, today is offset by positive macroeconomic statistics from Japan. Bank Lending in November increased by 2.1% YoY after growth by 2% YoY in the previous month. Experts expected a slowdown to +1.9% YoY. Japan's GDP for Q3 2019 grew by 0.4% QoQ after a 0.1% QoQ increase over the previous period. The indicator came out twice as good as its forecasts. On an annual basis, the Japanese economy grew by 1.8% YoY, which was significantly better than market expectations of 0.7% YoY.

XAU/USD

Gold prices are falling slightly during today's Asian session, losing about 0.03% and developing a "bearish" momentum formed at the end of last trading week. Reduction of gold quotes is due to a strong report on the US labor market, published last Friday. The American economy showed a sharp increase in the number of Nonfarm Payrolls at the most significant pace in the last 10 months. This allows investors to expect the Fed to continue taking a wait-and-see attitude and abandon the idea of additional stimulation of the economy.

 

[MikhailLF]

Morning Market Review
2019-12-10 08:39 (GMT+2)
EUR/USD

EUR shows moderate growth against USD during today's Asian session, continuing the development of the "bullish" impulse formed yesterday. At the same time, buying activity for the instrument in the market remains reduced, as investors expect the Fed meeting on Wednesday and the ECB meeting on Thursday. The euro is adding only 0.03%. Published on Monday, macroeconomic statistics from Europe provides the pair with moderate support. German Exports in October grew by 1.2% MoM after rising by 1.5% MoM in the previous month. Analysts had expected decline by 0.3% MoM. Imports for the same period showed zero dynamics after an increase of 1.2% MoM in September. Due to strong export growth, the Trade Surplus in October rose from 19.2 billion to 20.6 billion euros, which was better than forecasts expecting a correction to 19 billion.

GBP/USD

GBP is relatively stable against USD during the Asian session on Tuesday, consolidating near the record high of April 4 (1.3179), updated the day before. As before, the pound is supported by positive expectations regarding the upcoming parliamentary elections, which can decide the outcome of Brexit. According to numerous opinion polls, the Conservative Party has good chances of victory, which will allow Boris Johnson to ratify the agreement with the EU and withdraw Great Britain from the European Union by the end of January 2020. During Tuesday, investors expect the publication of interesting macroeconomic statistics from the UK. Among other things, market participants are interested in data on Manufacturing Production dynamics and GDP growth rates (in monthly terms) for October.

NZD/USD

NZD is showing moderate growth against USD during today's Asian session, recovering from a decline earlier this week. At the moment, the growth of the instrument is about 0.14%, and NZD itself is again approaching local highs of this August at around 0.6575. Moderate support for the instrument is provided by statistics on Consumer Inflation from China. CPI rose by 4.5% YoY in November after rising by 3.8% YoY in October. Experts expected the index to accelerate to 4.2% YoY. Additional support for the New Zealand dollar is provided by optimistic news regarding the conclusion of a trade agreement between the United States, Mexico and Canada (USMCA).

USD/JPY

USD shows a slight increase against JPY during today's Asian session, adding about 0.03%. Investors are in no hurry to open new trading positions ahead of the meetings of the Fed and the ECB in the middle of the week, and the yen, in turn, is stable against the backdrop of market uncertainty. First of all, investors are concerned about the possible introduction of new import duties on Chinese goods on December 15, since the administration of Donald Trump did not report anything new on this subject, and the parties obviously have not time to sign a trade agreement until that moment. In addition, strong macroeconomic statistics on GDP published at the beginning of the week provide additional support for the yen. In Q3 2019, the Japanese economy grew by 0.4% QoQ after growing by 0.1% QoQ a month earlier. Analysts had expected growth rate at 0.2% QoQ.

XAU/USD

Gold prices show a slight increase during today's Asian session, developing a weak "bullish" momentum formed earlier. Gold is supported by continued uncertainty surrounding US-China trade negotiations. Earlier, the Chinese Assistant Minister of Commerce Ren Hongbin said that Beijing was counting on an agreement in the near future, but there were very few specifics, as always. Meanwhile, markets fear that on December 15, Donald Trump will introduce new import duties on Chinese goods, which may erase all progress in negotiations during this time. As for the upcoming meetings of the Fed and the ECB in the middle of the week, investors do not expect any changes in the monetary policy vector from regulators; however, the comments of officials will be very important, especially considering that Christine Lagarde will deliver her first speech as President of the ECB.