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HFblogNews

Active Member
Date : 13th July 2020.

Events to Look Out for This Week.

An interesting week is coming up, packed with economic data and political developments, as next week’s EU summit highlights that the EUR 750 bln recovery fund proposed by the European Commission remains controversial in its proposed form, and remains far from certain. Attention will remain on virus reports and on the monetary policy meetings in the world’s major economies (ECB, BoJ and BoC) and their potential for guidance regarding future stimulus actions.
.Monday – 13 July 2020

• BoE’s Governor Bailey speech (USD, GMT 15:30) – In June’s meeting, the BoE voted unanimously to keep rates unchanged, but a 8-1 majority opted for an extension of the asset purchase target by GBP 100 bln to now GBP 745 bln. The overall tone of the assessment seemed less gloomy than the sharp contraction in monthly GDP had suggested. This speech could clear the view of further stimulus and the reports that the BoE has been talking with commercial banks to prepare them for the possibility of negative interest rates.
Tuesday – 14 July 2020

• Harmonized Index of Consumer Prices (EUR, GMT 06:00) – The German HICP inflation for June is anticipated to decline at 0.5% y/y from 0.8% y/y.
• Gross Domestic Product (GBP, GMT 06:00) – GDP is the economy’s most important figure. April’s GDP was contracted to -20.4% m/m.
• ECB Bank Lending Survey (EUR, GMT 08:00) – The bank lending survey (BLS) for the euro area was launched in 2003. Its main objective is to enhance the Eurosystem’s knowledge of financing conditions in the euro area.
• Economic Sentiment (EUR, GMT 09:00) – German July ZEW economic sentiment is expected to have declined at 60.0 compared to 63.4 in June.
• Consumer Price Index (USD, GMT 12:30) – The headline CPI for June is expected with a 0.1% core price rate, following May declines of -0.1% for both. The headline will be boosted by an estimated 13% June pop for CPI gasoline prices. As-expected June figures would result in a headline y/y increase of 0.6%, up from 0.1% in May. Core prices should sit a 1.0% y/y rise, below the 1.2% y/y pace last month.
• SNB’s Chairman Jordan speech (CHF, GMT 13:30)
Wednesday – 15 July 2020
• BoJ Interest Rate Decision and Conference (JPY, GMT 03:00- 06:00) – Shadowed by Covid-19, the BoJ has less room for monetary policy manoeuvre, with Japan not depending on foreign investment inflows to sustain financing and with Japanese investors apt during times of risk aversion in global markets to repatriate capital from the sale of foreign assets, and/or put on currency hedges on foreign assets.
• Consumer Price Index and Retail Sales (GBP, GMT 06:00) – Prices are expected to have eased in June, with overall inflation expected to stand unchanged at 0.5% y/y, and core at 1.3% from 1.2% y/y last month. UK retail sales expected to grow slightly to 0.1% in June.
• BoC Interest Rate Decision and Conference (CAD, GMT 14:00- 15:00) – Bank of Canada expected to maintain the 0.25% rate setting. However, since in the latest announcement the Bank maintained its commitment to continue large-scale asset purchases until the economic recovery is well underway, this is expected to be seen again this time.
Thursday – 16 July 2020
• Employment Data (AUD, GMT 01:30) – Both the unemployment rate and the employment change are expected to have grown in June.
• Gross Domestic Product (CNY, GMT 02:00) – GDP is the economy’s most important figure. Q2’s GDP is expected to be dropped to -9.9% q/q contraction from -9.8%q/q.
• Average Earnings (GBP, GMT 06:00) – Average Earnings excluding bonus are expected to have grown by 1.4% in May. The ILO unemployment rate is expected to have risen at 4.7% from 3.9%.
• ECB Interest Rate Decision and Press Conference (EUR, GMT 11:45 & 12:30) – So far the ECB seems to have been united behind the goal to provide financial market stability through the crisis as lockdowns not just across Europe plunged economies into deep recessions. However, hectic diplomacy ahead of EU summit highlights that the EUR 750 bln recovery fund proposed by the European Commission remains controversial in its proposed form, and remains far from certain. At the same time, there is a new rifts emerging at the ECB – not just over the need to use the full PEPP envelope, but also over the future of the inflation target. Virus headlines have distracted from the fact that the ECB is currently in the process of conducting a thorough review of its overall strategy and that also involved the definition of price stability, which currently still is set as “below but close to 2%”. In the current situation that would mean the central bank would leave expansionary policy measures in place longer than necessary to bring inflation back to the 2% target.
• Retail Sales (USD, GMT 12:30) – June increases are expected at 6.0% for headline retail sales and 6.7% for the ex-auto figure, following May increases of 17.7% for the headline and 12.4% ex-autos.
Friday – 17 July 2020
• Consumer Price Index (EUR, GMT 09:00) – The final Euro Area CPI for June is anticipated to slow down to 0.1% y/y from 0.3%y/y last month. The core inflation is seen at 0.9% y/y from 0.8% y/y.

Please note that times displayed based on local time zone and are from time of writing this report.

Andria Pichidi
Market Analyst
HotForex

Disclaimer:
This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HFblogNews

Active Member
Date : 14th July 2020.

Sterling in the Cross-hairs today.

GBPUSD, H1
UK data today has continued the pressure on Sterling, with the UK economy rebounding less than expected in May. Overall GDP lifted 1.8% m/m, compared to Bloomberg consensus of 5.5% m/m. With economic activity still falling -20.3% m/m in April, the modest uptick over the month still saw the annual rate falling back to -19.1%, from -10.8% y/y in the previous month. Industrial production actually lifted 6.0% m/m and construction output rebounded 8.2% m/m, but rebounds fell short of expectations and this also holds for the index of services, which lifted a mere 0.9% m/m, after still falling -18.9% m/m in April. Services are still down nearly 19% on last year’s levels, construction output is nearly 40% below the levels in May last year and overall industrial production 20%. Virus restrictions came later and subsequently were also lifted later in the UK compared to most other European countries, and forward looking confidence data are signalling that at least the construction sector is back in expansion territory. Still, the numbers highlight downside risks, especially as there is also not much progress in trade talks with the EU, leaving the risk that the transition period will end without a new deal in place.

The Office for Budget Responsibility (OBR) also issued their latest updates today and it makes sorry reading for the UK economy, with expectations of record peacetime levels of public debt and the largest decline in UK GDP in 300 years.

Cable carved out a six-day low at 1.2537, which has been partly a product of sterling underperformance following a much weaker than expected UK May GDP figure, and followed through to test 1.2505 following the OBR report. EURGBP concurrently lifted to a seven-day peak at 0.9069, and GBPJPY traded into six-day low terrain at 134.17.

Please note that times displayed based on local time zone and are from time of writing this report.

Stuart Cowell
HotForex

Disclaimer:
This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HFblogNews

Active Member
Date : 15th July 2020.

FX Update – July 15 – A Softer USD persists.

EURUSD, H1
The Dollar has remained on a softening track against most other currencies, while the Euro has remained broadly underpinned amid expectations for EU leaders to green-light the proposed EUR 750 bln recovery fund this week. The Pound managed to rebound after underperforming over the prior two days. Risk appetite has been buoyant, with European and Asia stock markets rallying and US equity index futures gaining, underpinned by news that US biotech company Moderna’s candidate vaccine for the SARS Cov-2 coronavirus was shown in an early-stage trial to be safe while successfully provoking immune responses in all 45 of the volunteers. News from Oxford, UK¹, too, that more progress is being made on the vaccine front also helped lift sentiment and equity markets.

The narrow trade-weighted USDIndex carved out a fresh one-month low at 95.80, drawing in on the four-and-a-half-month low seen in June at 95.72. EURUSD rallied to its highest level since early March at 1.1445. Cable rallied to a two-day high at 1.2626, extending a strong rebound from Tuesday’s eight-day low at 1.2479. The rise in Cable wasn’t just a softer dollar story, as the Pound concurrently rebounded against the Euro, driving EURGBP to a 0.9051 low, extending a correction from yesterday’s two-week high at 0.9115. GBPJPY also lifted to a two-day high. USDJPY drifted under 107.00, expecting a moderate correction from yesterday’s one-week high at 107.44. The risk-sensitive AUDJPY cross printed a five-week high at 75.29. AUDUSD similarly reached a five-week peak, at 0.7020. The BoJ left policy unchanged, as had been widely anticipated. Governor Kuroda maintained dovish guidance, noting that there remain various tools that could be utilized for further easing.

Ahead of the BOC later, USDCAD has ebbed to a two-day low at 1.3560, weighed down by a combination of the broader US dollar softness and a broadly firmer Canadian currency, which has been concomitant with a bout of risk-on positioning in global markets. Front-month USOil futures have rotated higher following a phase of sub-$40 pricing, printing a six-day high at$40.93, which has been supportive of oil-correlating currencies, including the Canadian Dollar. Gold continues to wind higher, trading to a four-day high at $1815 earlier, before cooling to$1805 currently.

Please note that times displayed based on local time zone and are from time of writing this report.

Stuart Cowell
HotForex

Disclaimer:
This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HFblogNews

Active Member
Date : 16th July 2020.

EUR & ECB Preview.

Economic activity has rebounded on both sides of the channel as lockdowns were lifted, but the impressive rebound in confidence data in recent months has proven to be too optimistic on the speed of the recovery with real sector data for May actually looking weaker than hoped. That ties in with the moderation in market confidence, which was also reflected in German ZEW investor confidence, which pulled back from June highs in today’s July numbers. Central bankers meanwhile acknowledge that the second quarter may not have been as bad as initially feared and have essentially switched to a wait and see stance, after putting substantial crisis measures in place.

With that in mind the ECB is widely expected to keep policy settings unchanged at today’s meeting. Lagarde’s recent comments suggest that data releases have come in slightly better than officials had feared and the central bank seems ready to move out of crisis mode and into a wait and see stance. That doesn’t mean the ECB won’t keep the option of additional easing measures open, but for now officials should be able to afford to take a step back and monitor the impact of crisis measures already implemented.

Wait and see then is likely to be the main message at today’s council meeting, although Lagarde will, however, stress again the need for fiscal stimulus to support monetary policy and step up the pressure on politicians to come to an agreement on the proposed EUR 750 bln pandemic recovery fund, that will be discussed at the EU leaders summit later in the week. Central bankers have long stressed the need to complement monetary policies with appropriate fiscal policies and on the whole central bankers also seem to welcome the proposal for a jointly funded mechanism and a focus on grants rather than loans.

The debate will take place within the context of the EU’s next multiannual budget framework, and won’t be easy, as countries disagree on whether to focus on grants or loans and whether jointly backed market funding is the right way forward.

Markets have the fund pretty much priced in and the risk is of course that the reality of EU politics once again falls short of what investors are looking for.

DAX – GER30

Meanwhile European stock markets are broadly lower
with peripheral markets outperforming slightly going into the ECB meeting. General risk appetite has waned again amid concerns about the global outlook and rising tensions between the US and China. The GER30 is currently down -0.8%, and the UK100 down -0.9%, while IBEX and MIB are posting losses of -0.1%. US futures are also heading south following on from a broad move lower across Asian markets.

GER30, despite the short term decline, sustains 4-month highs, close to the 13,000 area. The index filled May’s and June’s gap, while it has been trading well above Ichimoku cloud since May, suggesting an overall positive bias. All daily exponential moving averages (20, 50 and 200) are aligned northwards. Momentum indicators are gradually moving more positive as the market has pulled higher this week. RSI is above 60 and confirming higher lows since early June, inline with the uptrend in the price action along with strong positive configuration on Stochastics, despite the flattening of MACD lines that suggest consolidation. The bulls could be looking to use any near term weakness as an entry point. Hence Support could be seen at 12,500 (20-DMA and 76.4% Fib. level since January 2020).

It is interesting to see though that despite the positive technical background it struggles to break the 13,000 Resistance area.

EURO

The EUR fell back against a generally stronger US Dollar, with EURUSD trading slightly above S1 at 1.1384. Risk appetite waned again, amid concern about the world recovery, and US-China tensions and with the security breach at Twitter Inc not helping. Eurozone markets which traded unevenly yesterday are likely to remain cautious going into the ECB announcement today.

EUR intraday remains under pressure with fast MAs aligned lower and lower Bollinger bands extending southwards. Next immediate support could be found at 1.1350, and 1.1330 (200-EMA in 1-hour chart). Volumes meanwhile declining suggesting that the bullish momentum seen since 10 of June is threatened.

Please note that times displayed based on local time zone and are from time of writing this report.

Andria Pichidi
Market Analyst
HotForex

Disclaimer:
This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HFblogNews

Active Member
Date : 17th July 2020.

FX Update – July 17 – Preparing for the Weekend.

Currencies have hunkered down in narrow ranges, with the Dollar and Yen consolidating after rising against most other units yesterday. Global stock markets are lacking direction, too. The persisting pandemic remains a concern for investors, even though the lack of fresh cases in many reopened countries now looks like nothing more than a bad respiratory illness season. Offsetting pandemic concerns are expectations for the US and other countries to extend “first wave” fiscal support packages before they expire, while EU leaders will meet later today to move the proposed EUR 750 bln recovery fund toward fruition.

Among currencies, EURUSD settled just above the three-day low that was seen yesterday at 1.1370. USDJPY plied a sub-20 pip range in the lower 107.00s, and EURJPY and other yen crosses were similarly directionally challenged. AUDUSD held in a narrow range above yesterday’s three-day low at 0.6963. AUDJPY did likewise. USDCAD edged out a two-day high at 1.3589, extending a rebound from Thursday’s eight-day low at 1.3500. Front-month USOil prices remained in a narrow-range consolidation below the three-week high seen earlier in the week at $41.26. Highlights on the calendar today include eurozone June inflation and US consumer confidence data, neither of which are likely to impact markets much. Market participants will also be watching the White House for a decision on whether President Trump will follow through on his threat to ban Chinese Communist Party members from travelling to the US. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission. HFblogNews Active Member Date : 20th July 2020. Events to Look Out for This Week. The week ahead will be a quiet one due to the limited economic releases, with the most telling data the preliminary estimates of July manufacturing PMIs from across the globe. Monday – 20 July 2020 • PBoC Interest Rate Decision (CNY, GMT 01:30) – The People’s Bank of China announced heavy government and PBoC stimulus measures in the 1st half of the year. However, China’s central bank isn’t planning much more stimulus for the country as its economy looks to be recovering. • National CPI Index (JPY, GMT 23:30) – The Japanese price index should have zeroed on a y/y basis, compared to 0.1% in May. Tuesday – 21 July 2020 • RBA Minutes (AUD, GMT 00:30) – The RBA minutes will provide more insight on the views the Australian Central Bank has about the economy. • Retail Sales (CAD, GMT 12:30) – Core Canadian sales ex Autos are anticipated to have dropped by -13.5% m/m in May, but higher than April’s drift at -22% m/m. Wednesday – 22 July 2020 • Consumer Price Index and Core (CAD, GMT 12:30) – June BoC CPI is expected higher at 0.9% y/y from 0.7% y/y and at 0.2% m/m from 0.3% m/m in May. • Existing Home Sales (USD, GMT 13:00-14:00) – A 22.8% rebound is anticipated in existing home sales in June to a 4.800 mln pace, after a drop to 3.910 mln in May. The MBA purchase index surged by 40% in May and 17% in June, before a 3% rise thus far in July, after falling -21.8% in April. Existing home sales are tracked at closings, so sales by this measure remained weak into May even though the sector was bouncing. The median sales price is expected to rise to$285,000 in June to leave a y/y decrease of -0.1%, down from a 2.3% y/y rise in May, with potential downward pressure from a skewing of sales toward lower-cost areas. In Q1, we saw an average sales pace of an elevated 5.483 mln, and we expect a lower 4.347 mln pace in Q2.
Thursday – 23 July 2020
• Jobless Claims (USD, GMT 12:30)– US initial jobless claims declined -10k to 1,300k in the week ended July 11 following the -98k drop in the July 4 week to 1,310k (was 1,314k). It’s a 15th straight weekly decline since the record surge to a historic peak of 6,867k in late March.
Friday – 24 July 2020
• Retail Sales (GBP, GMT 06:00) – Following the -9.8% m/m contraction in UK retail sales ex fuel in May, they are expected to decline further by -14.4% in June.
• Services and Manufacturing PMI (EUR, GMT 08:00) – June PMIs marked contraction in manufacturing activity and a sharp slowdown in services sector growth. This picture is likely to be seen again in the preliminary readings for July, as German Manufacturing PMI has been forecast at 41.5 and composite at 44.2, which it is still below neutral. Meanwhile, Services PMI is expected to fall to 42.0. The Manufacturing and Services PMI for Eurozone is seen at 44.5 and 41 respectively.
• UK Service PMI (GBP, GMT 08:30) – The preliminary services PMI for July are seen to remain in contraction levels at 47.0.
• Services and Manufacturing PMI (USD, GMT 13:45) – Preliminary Manufacturing are expected to slip in July, to 48 from 49.8.

Please note that times displayed based on local time zone and are from time of writing this report.

Andria Pichidi
Market Analyst
HotForex

Disclaimer:
This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HFblogNews

Active Member
EU leaders reach a deal – EUR mixed.

EU leaders reach agreement on recovery fund, 7-year budget. After the second longest summit on record EU leaders managed to find a complex compromise on the EUR 750 bln pandemic recovery fund and the next seven year budget, which together amount to an unprecedented EUR 1.82 trillion. That these discussions would not be easy was clear from the outset, and after marathon talks the compromise is a complex system that aims to accommodate all sides.

The portion of grants in the pandemic recovery fund was scaled back to EUR 390 bln from EUR 500 bln in the original proposal. There is also a new system that allows states to stop handouts by qualified majority over rule-of law violations, a move that finally appeased Dutch Premier Rutte, who had voiced concern over some legislation in Poland and Hungary. The Netherlands and Austria were also among the countries securing larger budget rebates in exchange for agreeing to cash handouts, rather than conditional loans that require budget oversights in the recovery fund. The European Commission will also be tasked with coming up with proposals on protecting the EU budget and recovering spending more effectively.

All in all a complex deal – typical for the EU – and while a deal is on the table, the EUR is heading south in what looks like a “buy the rumour sell the fact move” that likely also reflects some disappointment over the lower portion of grants in the recovery fund. EURUSD is currently trading at 1.1447 (above PP), while the Pound is little changed from yesterday against the Dollar and higher against the EUR.

GER30 and UK100 futures are up 0.5% and 0.4% respectively and US futures are also making headway, with the USA100 outperforming again.

BTPs already rallied yesterday, there may be some consolidation today, especially as the final portion of grants was lower than in the original proposal at EUR 390 bln out of a EUR 750 bln total.

Please note that times displayed based on local time zone and are from time of writing this report.

Andria Pichidi
Market Analyst
HotForex

Disclaimer:
This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HFblogNews

Active Member
Date : 22nd July 2020.

FX Update – July 22 – Dollar & Yen Down.

AUDUSD, H1
The Euro, along with the Aussie and Kiwi Dollars, posted fresh highs against the Dollar and Yen, despite a backdrop of flagging stock markets. EURUSD reached its highest level since January 2019, at 1.1547, the culmination of what has now been a five-week rally. EURJPY pegged a fresh six-week high at 123.34. Most other Euro crosses are also firmer, though remain below recent highs. Cable has moved below 1.2700, to 1.2660, below Tuesday’s six-week peak at 1.2768. USDJPY plied a narrow range just above the one-week low seen yesterday at 106.68, while EURJPY and the risk-sensitive AUDJPY scaled to respective six-week highs. GBPJPY and CADJPY, in contrast, remained below their respective six-week highs, which had been printed yesterday. AUDUSD reached a new 15-month peak at 0.7165, while NZDUSD ascended further into 18-month high territory. USDCAD settled around the 1.3450 mark, above the six-week low seen yesterday at 1.3422, concomitant with front-month USOil futures at $41.50, below the three-and-a-half month peak that was left at$42.40 yesterday.

Gold and silver prices have continued to surge, reflecting investors’ expectation for global monetary stimulus taps to remain open and the Dollar to remain weak. The gains in the non-yielding assets also reflect concerns that inflation might spike as a consequence of the stimulus. XAUUSD rallied to $1865 earlier before cooling to the$1850 zone, whilst XAGUSD ran to $22.80 (October 2013 highs) before trimming gains to R1 at$21.70.

In other news, the UK’s Telegraph newspaper reported that the UK government is pessimistic about reaching a trade deal with the EU, just days before Prime Minister Johnston’s end-of-July deadline for reaching a deal in principle. The FT also reported, citing unnamed senior government officials, that the UK government has abandoned hopes for reaching a trade deal with the US before the presidential election in November, which means that there will be zero hope for a deal by the time Britain leaves the EU’s single market at the end of the year. The pandemic gets the blame for the slow progress.

Please note that times displayed based on local time zone and are from time of writing this report.

Stuart Cowell
HotForex

Disclaimer:
This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HFblogNews

Active Member
Date : 23rd July 2020.

FX Update – July 23 – USD Trends Lower.

The Dollar has continued to track lower, despite a backdrop of flagging stock markets in Asia, although US equities closed with moderate gains yesterday and S&P 500 futures are showing a modest rise in overnight trading. The narrow trade-weighted USDIndex (DXY) printed a fresh four-and-a-half-month low at 94.82, drawing in on the early March low at 94.66, which was the lowest level seen since August 2018.

EURUSD has been buoyant, though has remained below the 21-month high that was printed yesterday at 1.1601. The pair is amid its fifth week of an accelerating rally phase, underpinned both by broader dollar weakness (amid shifting risk premia in global markets) and broader euro outperformance (on the back of the EU recovery fund, seen as reducing Eurozone breakup risk while creating a new liquid AAA fund that will attract foreign investment). The common currency has been gaining against most other currencies recently, outside the case against the outperforming commodity currencies. The research team at Goldman Sachs is anticipating a further 10% gain in the Euro. EURJPY has seen a similar price action to EURUSD today, in holding off yesterday’s seven-week peak. Other euro crosses have also been steady.

Elsewhere, USDJPY has continued to ply a narrow range near the 107.00 level. Cable remained buoyant, settling in the lower 1.2700s, below Tuesday’s six-week high at 1.2768. The Pound has been trading more mixed against other currencies. AUDUSD has settled near 0.7150, so far holding below the 15-month high seen yesterday at 0.7183. A sharp drop in Australia’s Q2 business confidence survey had been widely anticipated, as was a downbeat economic update of the Federal government. USDCAD posted a fresh six-week low at 1.3378, with the Canadian Dollar firming concomitantly with oil prices. Front-month USOil lifted back above $42.00, drawing back in on Tuesday’s four-and-a-half-month high at$42.40.

Geopolitics remain a concern, as China blacked out English premier league games on Chinese television, and closed the US consulate in Chengdu in retaliation for the White House closing the Chinese consulate in Houston. President TRUMP said Chinese consulates in other US cities could come under investigation.

Please note that times displayed based on local time zone and are from time of writing this report.

Stuart Cowell
HotForex

Disclaimer:
This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HFblogNews

Active Member
Date : 24th July 2020.

FX Update – July 24 – USD remains heavy.

USDJPY, H1

The Yen has outperformed today as risk aversion took a firm grip on global markets.
The Dollar has so far failed to pick up safe haven demand, and has remained on a softening path. The narrow trade-weighted USDIndex carved out a fresh 22-month low at 94.49. The Dollar has lost appeal partly on the advent of the EU’s recovery fund, seen as a milestone by many analysts that has served to tip the balance out of the dollar’s favour, and partly amid expectations for dovish guidance from the Fed at next week’s FOMC, with some speculating that the US central bank is considering yield curve targeting. A Reuters survey highlighted increasing pessimism about the nearer-term US outlook given the extent of localized lockdown measures in response to the spike in coronavirus cases across many southern and western states. Intel also underwhelmed markets in its guidance for Q3 earnings.

Against this backdrop, EURUSD remained firm, although off from the 21-month peak that was seen yesterday at 1.1628. USDJPY dropped by 0.5% to a one-month low at 106.17. Yen crosses were concurrently weak, driven by safe haven demand for the Yen. EURJPY fell to a two-day low at 123.36, extending a correction from Wednesday’s seven-week peak at 124.30. AUDJPY has been the biggest mover of the day so far, dropping 0.6% to a three-day low at 75.32. AUDUSD fell by a lesser magnitude, but still managed to peg a three-day low, at 0.7074. USDCAD lifted to within a pip of its peak from yesterday, at 1.3428. Oil prices have remained heavy after yesterday sinking to three-day lows. Cable edged out a fresh six-week high at 1.2773. The pair has been trending higher for about three weeks, though recent daily price action has been jagged and upside momentum has been waning, with the Pound having been weakening against other currencies on signs, and confirmation at a press conference yesterday, that the UK and EU remain deadlocked on key issues in trade talks.

The first reading of July PMIs from the Eurozone and the UK both beat expectations earlier. The Markit Composite EZ number came in at 54.8, significantly above expectations of 51.1 and back in expansion territory over 50.0. The preliminary UK July PMI surveys smashed expectations, with the composite headline surging to a five-year high of 57.1, up from 47.7 in the final reading for June and well up on the median forecast for a 50.8 reading. This extends the strong rebound for a third consecutive month from April’s series-record low at 13.8. The services PMI rose to 56.6 from 47.1 and the manufacturing PMI lifted to 53.6 from 50.1. However, a note of caution accompanied the data, with Markit noting – “July’s PMI represents a step in the right direction, but there is a mountain still to climb before a sustainable recovery is in sight.”

Please note that times displayed based on local time zone and are from time of writing this report.