Daily Market Anayalisis by Forex Mart

[nitufx]

Crude Oil is down over 80 cents at 48.07 as traders realize that supply outpaces demand with global growth falling. Brent Oil is down 73 cents at 49.62. The US dollar is always important when setting US crude oil prices; a stronger dollar makes oil imports highly expensive for other countries. The US dollar grew by nearly 1.3% from its recent lows, following the Fed’s indication of potential growth in US interest rates.

Traders also fear that the US supply could begin increasing if the price of crude oil continues to trade in the range of $50 to $60 a barrel. Baker Hughes reported a second consecutive week of growth in the US rig count and it is indicating that US producers are establishing their footprints for potential growth at current crude oil prices.

US crude slipped over 3% to $49.07 a barrel on Friday, thanks to growth in the US rig counts, a surge in the dollar, and traders’ concerns over US supply levels. International Brent oil prices declined 2.79% to just over $50 a barrel at the end of the latest session. (Economics Calendar)

Economic data from Asia is presenting a bleaker picture regarding oil demand. China, the largest consumer of crude oil, imported less oil in the month of May than in several preceding months. Traders now believe that US crude oil will continue to hover around $45 to $50 a barrel in the short-term, due to the threat of growth in production.

 

[nitufx]

Weekly Technical Outlook: EUR/USD;Market Forecasts for June 20th – June 24th
Resistance level 1.1392, 1.14847, 1.16214

Pivot Level 1.12707

Support Level 1.121126
Technical Analysis

Technical Analysis

EUR/USD is looking for consolidation pattern from 1.12112 levels and is still in progress with support holding the levels strongly. The price action produced strong bullish pin bar reversal and two bar reversal at the close of the week and a candle indicating a shift in the momentum to upside bias.

The pair closing above the break of trend line looks for a corrective upward bias, thus confirming the bullish movement.

A medium term rally is seen in progress from current levels with the pair finding support and oscillator seen above 52.0 levels. An upward momentum is looking stronger with sustained trading above 1.1392 confirming a strong long term momentum. This will remain the favored case as long as the support holds and would pave the way to reach these levels. Any breaks here can expect levels of 1.14847 and later at 1.16214.

Outlook remains bullish for week.
Economic

Non-monetary policy's ECB meeting, Targeted LTRO

Markit Manufacturing PMI, Markit Services PMI

Fed's Yellen testifies, Existing Home Sales, Fed's Yellen testifies

Initial Jobless Claims, New Home Sales , Durable Goods Orders

Area of Interest

Strong support at 1.12112 area and closed above support levels.

Bullish Pin bar reversal strongly closing above the support area.

Price action closed above the break of trend line and oscillator above 52.0 levels indicating shift in momentum.

At Flip Area on Daily time frame support levels.

 

[nitufx]

AUD/USD Fundamental Forecast – July 4, 2016

The AUD/USD moved up 8 points to 0.7459 remaining just where the RBA wanted the currency to trade. A more positive mood hit the markets after stronger data printed in the morning session. Chinese Caixin manufacturing PMI missed forecast which sparked a rally on hopes of more stimulus from the PBOC. *Chinese manufacturers reported the sharpest deterioration in operating conditions in four months in June amid economic weakness at home and abroad, with the Caixin China Purchasing Managers' Index coming in at 48.6.
The reading is lower than May's 49.2, partly because output fell at the quickest pace since February. Figures above 50 indicate expansion, while those below signifies economic contraction. The June figure was the lowest since January, when the PMI dipped to 48.4, and marks the 16th consecutive month of contraction.
Total new orders decreased in June for the second month in a row for manufacturers, driven by the seventh straight monthly decline in new export sales.
Companies also continued to pare back staffing for the 32nd successive month at a rate similar to that in the previous four month.
Fewer new orders contributed to a reduced amount of purchasing activity across the manufacturing sector. Meanwhile, companies maintained tighter inventories, with stocks of both pre-production and finished goods falling, albeit at slower rates than in the previous month.
The Australian dollar is sharply higher as investors sell off US dollars to balance their books at the end of the quarter.
BK Asset Management managing director of FX strategy Kathy Lien says the move has been triggered by investors adjusting their portfolios at the end of the June quarter.
“Managers of index funds and other similar equity market portfolios need to sell dollars and buy euros or pounds to bring their overall exposure back into balance,” she said.
FxEmpire provides in-depth analysis for each asset we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

 

[nitufx]

The EUR/JPY dipped 11 points this morning sending the yen into a tizzy as it touched 111.38. The Japanese yen has taken full advantage of the Brexit referendum, which saw Britain vote to exit the European Union. The yen has posted strong gains of 3.5 percent since Brexit, as jittery investors have dumped risk assets in favor of the safe-haven Japanese currency. Brexit aftershocks are far from over, as underscored by the woeful British pound, which is struggling at 30-year lows. With risk sentiment decidedly negative, the yen could break below the symbolic 100 level, which last occurred just after the Brexit vote in late June. Although the Bank of Japan has been reluctant to adopt further easing measures, it may have to act in order to curb a streaking yen which is hurting the export sector. Japanese officials have repeatedly warned against what they have termed “currency manipulations” and have threatened to intervene if the yen continues to move higher.

More effective in weakening the yen has been monetary policy. Massive injections of money into the economy by the Bank of Japan in recent years helped push the Japanese currency to around 125 to the dollar in 2015. But its efforts to stimulate the economy this year, including a shock move to negative interest rates, failed to halt the yen's rise.