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MikhailLF

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Morning Market Review
2019-07-15 08:22 (GMT+2)
EUR/USD

The euro maintains an upward trend against the US dollar. On July 12, the single currency managed to strengthen amid the publication of good macroeconomic statistics from the Eurozone. Industrial output in May rose by 0.9% MoM after declining by 0.4% MoM last month. Analysts expected growth of only 0.2% MoM. The indicator accelerated the decline from −0.4% YoY to −0.5% YoY, which, however, turned out to be significantly better than forecasts of −1.6% YoY. More confidently strengthening of the instrument was hampered by previously published data from Germany. The wholesale price index in June showed a decline of 0.5% MoM after rising by 0.3% MoM last month. Investors predicted the growth of 0.2% MoM. YoY, the index growth slowed down from 1.6% to 0.3%, which also turned out to be significantly worse than analysts' expectations of 1.3%.

GBP/USD

The pound showed quite an active growth against the US dollar on Friday, updating local highs of July 5. There were none interesting macroeconomic statistics from the USA and the UK, so the focus was on existing factors. However, investors followed the speech of the representative of the Bank of England Gertjan Vlieghe, who allowed the possibility of a sharp reduction in interest rates by the regulator, if the government fails to approve the agreement on Brexit. Today, the instrument is trading with moderate growth, preparing to update the previous local maxima. Strengthening of the pound is not hampered by weak data from the UK. The Rightmove house price index in June showed a decline of 0.2% MoM and 0.2% YoY after rising by 0.3% MoM and 0.0% YoY in May.

AUD/USD

The Australian dollar showed strong growth against the US one on Friday, rising to the highs of July 5. The reason for the strengthening of the instrument was the correctional dynamics of the US currency. Ambiguous macroeconomic statistics from China and the United States hampered a more confident growth of the “Australian”. Today, the instrument is supported by strong data from China. Retail sales in June rose by 9.8% YoY after rising by 8.6% YoY last month. Analysts were expecting a slowdown to 8.3% YoY. The industrial output for the same period increased by 6.3% YoY after rising by 5.0% YoY in May. In Q2, China's GDP accelerated from 1.4% QoQ to 1.6% QoQ (with a forecast of 1.5% QoQ).

USD/JPY

The US dollar showed a steady decline against the Japanese yen on Friday, updating local lows of July 5. It is curious that this happened amid the publication of weak macroeconomic statistics from Japan. In May, industrial output in Japan slowed down from 2.3% MoM to 2.0% MoM. YoY, the decline in production increased from −1.8% to −2.1%, which turned out to be worse than market expectations. Today, the pair is trading in an uptrend. Japan's markets are closed on Monday to celebrate the Marine Day, so statistics from China and the United States remain in the spotlight. Chinese data on GDP, retail sales, and industrial output were stronger than forecasts, which contributed to the growth of investor interest in risk. With the opening of the American session, investors are awaiting the publication of the index of the July Manufacturing PMI from the New York FRB.

Oil

Oil prices are consolidating near local highs, updated at the end of the week. Quotes are supported by a reduction in the production of some US manufacturers in the Gulf of Mexico due to a tropical storm. On the other hand, investors were disappointed with the published report of the International Energy Agency. According to it, further growth in production in the USA will contribute to the growing imbalance of supply and demand in the market. The IEA expects a decline in oil demand by 2020 to a record level since 2003. Additional support for quotes was provided by Baker Hughes report on active oil platforms in the USA published on Friday. During the week, the number of drilling rigs decreased from 788 to 784 units.
 
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MikhailLF

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Morning Market Review
2019-07-16 08:31 (GMT+2)
EUR/USD

The euro showed a negative trend against the US dollar on July 15, departing from local highs, updated on Thursday. On Monday, there were no interesting macroeconomic statistics from the Eurozone, so investors concentrated on existing data and releases from China. In the US, only the New York Fed Manufacturing PMI has been published. In July, the figure rose by 4.3 points after falling by 8.6 points in June and with the forecast of growth by only 2.0 points. Today the pair is trading ambiguously, waiting for the appearance of new drivers. Investors are focused on a block of statistics on business sentiment in Germany and the Eurozone from the ZEW Institute. Also, investors are awaiting the publication of data on consumer prices in Italy for June and the Eurozone trade balance for May. The USA will respond by releases on retail sales and industrial output for June. By the end of the daily session, the market expects the speech of Fed Chairman Jerome Powell.

GBP/USD

The pound fell markedly against the US dollar on Monday. A certain pressure on the British currency was caused by weak statistics on the dynamics of housing prices. The Rightmove house price index in June showed a decline of 0.2% MoM and 0.2% YoY after rising by 0.3% MoM and 0.0% YoY in May. An additional negative factor is growing uncertainty around Brexit. In the near future, elections will be held for the new prime minister, who will have to resolve issues of coordinating a deal with the EU. The current deadline implies the Brexit by October 31, and some candidates, for example, Boris Johnson, insist on a "tough" Brexit, if parliament re-blocks the agreement. Today, investors are focused on statistics on the labor market. Also, the speech of the Bank of England's head Mark Carney is expected.

AUD/USD

The Australian dollar continues to grow steadily against the US one, updating local highs since July 4. Monday's macroeconomic statistics from China provided strong support to AUD. The data indicated a sharp increase in industrial output in June from 5.0% to 6.3% YoY, with a forecast of 5.2% YoY. China's quarterly GDP accelerated from 1.4% to 1.6% (forecast 1.5% QoQ). YoY, as analysts had expected, GDP slowed down from 6.4% to 6.2%. Today, the pair is trading in both directions, waiting for the appearance of new drivers on the market. Investors are focused on the protocol of the RBA meeting of July 2, at which the regulator decided to reduce the interest rate by 25 basis points to 1.00%.

USD/JPY

The US dollar showed a flat dynamics against the Japanese yen on Monday and today shows a slight growth. There were no data from Japan, as the markets were closed on the occasion of the Marine Day. On Tuesday, there would be also no publications from Japan, so investors will focus on releases from the USA. The focus is on statistics on retail sales and industrial output for June. Fed Chairman Jerome Powell is expected to speak, as well as a number of other Fed representatives, among whom are Raphael Bostic, Michelle Bowman, and Charles Evans.

Oil

Oil prices declined slightly on July 15, responding to the publication of controversial macroeconomic statistics from China. Quotes are still supported by a high degree of tension in the Middle East, as well as the lack of progress in the US-China trade negotiations. Chinese data pointed to weak economic growth in annual terms, but also reflected a sharp increase in industrial output, which correlates well with the increase in crude oil imports. Import volumes rose to a record high of 13.07 million barrels per day (by 7.7% YoY). Growth was promoted by the launch of new refineries in China. On Tuesday, investors are focused on the publication of the API report on oil reserves for the week of July 12.
 

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Morning Market Review
2019-07-18 08:45 (GMT+2)
EUR/USD

The euro rose against the US dollar on July 17, recovering from a steady decline the day before, when investors were inspired by strong data on US retail sales. On Wednesday, the macroeconomic background changed noticeably. Traders are optimistic about the data on consumer inflation in the Eurozone. In June, the consumer price index rose by 0.2% MoM and 1.3% YoY, accelerating from the previous values of 0.1% MoM and 1.2% YoY. In June, the base CPI rose from 0.3% to 0.4% MoM, which turned out to be better than market expectations 0.3% MoM. YoY, the index accelerated from 0.8% to 1.1%, which coincided with analysts' forecasts. The pressure on the dollar is provided by a weak statistics on the US housing market. The change in the number of new living buildings in June fell by 0.9% MoM after a decrease of 0.4% MoM last month. The number of building permits in June decreased by 6.1% MoM after rising by 0.7% MoM in May.

GBP/USD

The pound showed a slight increase against the US dollar on July 17, interrupting the development of a strong "bearish" impulse formed the day before. The growth of the instrument was largely technical, while the macroeconomic background from the UK remained moderately negative. On Wednesday, investors were focused on a report on consumer and industrial inflation. In June, the consumer price index showed zero dynamics, slowing down from the previous growth of 0.3% MoM. YoY, the inflation continues to remain at the target level of 2%. The producer price index for the same period decreased by 0.1% MoM and grew by 1.6% YoY, which was worse than analysts' expectations of growth by 0.1% MoM and 1.7% YoY. Today, statistics on retail sales, as well as the Bank of England report on the terms of lending for Q2 2019 will be published.

AUD/USD

The Australian dollar closed Wednesday trading with ambiguous dynamics against the US currency. The growth of the instrument was due to the publication of weak data on the US housing market, but the generated momentum was not enough for AUD to enter the green zone. In addition, investors were in no hurry to open new positions awaiting the publication of the Australian labor market report for June. Today, the pair shows moderate growth, despite the fact that the report data were ambiguous. The employment rate in June rose by only 0.5K after rising by 45.3K last month. Analysts had expected growth of 10.0K. Full employment rose by 21.1K after rising by 2.4K last month. Part-time employment fell by 20.6K after rising by 39.8K in May. Unemployment, as expected, remained unchanged at 5.2%.

USD/JPY

The US dollar returned to decline against the Japanese yen on July 17, leveling off the results of Tuesday's correctional growth. The development of negative dynamics was supported by the publication of weak statistics on the housing market. In addition, investors are concerned about the possible exacerbation of the US-China trade relations since the ongoing negotiations have not yet led to positive results. The rate of houses construction started in the US in June decreased by 0.9% MoM after a decrease of 0.4% MoM last month. Analysts had expected growth of 1.9% MoM. The changes in the number of building permits issued was also negative. In June, it collapsed by 6.1% MoM after rising by 0.7% MoM last month. Today, the pair is developing a downward trend. The import and export statistics published in Japan exert certain pressure on the yen. Exports in June fell by 6.7% YoY after falling by 7.8% YoY last month. Analysts had expected a decline of 5.6% YoY. Import volumes collapsed by 5.2% YoY after falling by 1.5% YoY in May.

Oil

Oil prices showed a moderate decline on July 17, pressured by an ambiguous EIA report. The report reflected a decline in oil reserves for the week of July 12 by 3.11 million barrels, which turned out to be better than the expected decline by 2.69 million barrels. At the same time, the data indicated an increase in the stock of gasoline and distillates, which offset the positive effect of the decrease in crude oil reserves. US production fell from 12,300 to 12,000 million barrels, which, however, was due to the closure of some of the oil rigs in the Gulf of Mexico because of the storm.
 

MikhailLF

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Morning Market Review
2019-07-19 08:24 (GMT+2)
EUR/USD

The euro rose significantly against the US dollar on Thursday, returning to the local highs of July 15. The single currency was still supported by moderately optimistic data on consumer inflation in the Eurozone in June. In addition, investors were noticeably disappointed with the US statistics on the housing market, which turned out to be below market expectations. There was no new data from the Eurozone on Thursday, so the euro developed a correctional dynamics amid the lack of progress in the US-China negotiations. Today, the instrument again trades in both directions with a noticeable predominance of "bearish" sentiment. Investors expect the publication of data on industrial inflation in Germany for June and the statistics on the balance of the current account in the Eurozone in May.

GBP/USD

The British pound strengthened against the US dollar on July 18, returning to the levels of the week's beginning. The pound was strongly supported by data on retail sales in the UK, which lowered concerns about a further slowdown in the British economy (especially in view of a possible "tough" Brexit). In June, retail sales increased by 1.0% MoM after a decline of 0.6% MoM in May. YoY, sales accelerated from 2.2% to 3.8%, which was significantly better than the forecast of 2.6%. Today, investors are noticeably cautious, fearing to develop an upward trend in the instrument. The focus is on data on the dynamics of public sector borrowing in June, as well as the publication of statistics on the University of Michigan consumer confidence index for July.

AUD/USD

The Australian dollar rose substantially against the US one on Thursday, updating local highs of April 24. It is curious that AUD has managed to show quite active growth, despite the ambiguous report on the Australian labor market for June. It reflected employment growth for mere 0.5K jobs, while in May the growth was 45.3K. Analysts were expecting growth of 10.0K jobs. Macroeconomic statistics from the USA published on Thursday was moderately optimistic. The secondary jobless for the week on July 5 decreased from 1.728 to 1.686 million, with an expected decrease only to 1.700 million. Initial jobless claims expectedly increased from 208K to 216K. Most of the support for USD currency was provided by the Philadelphia Fed Manufacturing PMI, which rose from 0.3 to 21.8 points in July against the forecast of growth to 5 points.

USD/JPY

The US dollar showed a steady decline against the Japanese yen on Thursday, updating local lows of June 26. Today, the pair is trading with quite active growth, being influenced by technical factors. Investors are focused on a block of macroeconomic statistics from Japan on consumer inflation, which, however, does not have a noticeable effect on the instrument. The national consumer price index in June showed an increase of 0.7% YoY, which coincided with the previous data and forecasts of experts. In turn, the activity index in all industries in May rose by 0.3% MoM after rising by 0.9% MoM last month, while investors expected negative dynamics of −0.2% MoM.

Oil

Oil prices showed ambiguous trend on July 18, updating monthly local minima. Quotes began to fall amid a sharp decline in US stock exchanges, as well as due to expectations of a quick recovery in production in the Gulf of Mexico after the hurricane last week. The instrument is also pressured by a previously published report from the EIA, which indicated a decrease in crude oil reserves, but also reflected a sharp increase in gasoline and distillate stocks. Investors are also reacting negatively to deadlocked US-China trade negotiations. Apparently, the situation will not change as long as the US authorities do not ease the sanctions on the Chinese company Huawei. On Friday, a Baker Hughes report on active oil rigs in the US is expected.
 

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Morning Market Review
2019-07-22 08:23 (GMT+2)
EUR/USD

The euro fell markedly against the US dollar on July 19, leveling off growth the day before. Technical factors contributed to the weakening of the instrument, while the macroeconomic background remained controversial. On Friday, the euro was pressured by a weak data on production inflation in Germany. In June, the producer price index fell by 0.4% MoM after falling by 0.1% MoM last month. YoY, the index slowed down from 1.9% to 1.2%, below market expectations of 1.4%. In turn, the dollar reacted negatively to the speech of Fed representative James Bullard, who spoke in favor of a strategy of rapidly lowering interest rates, which would allow avoiding the development of another economic crisis. Investors saw in these words hints of a possible reduction in the interest rate at the end of July. Today, the instrument shows ambiguous dynamic, awaiting the appearance of new drivers in the market. Investors are focused on the Bundesbank monthly report, as well as the publication of the Chicago Fed National Activity Index for June.

GBP/USD

The pound showed a corrective decline against the US dollar on Friday, departing from the local highs updated on July 15. On Friday, the British currency was pressured by disappointing data on the dynamics of public sector borrowing. In June, net borrowing increased from 3.822 to 6.500 billion pounds, which was significantly worse than market expectations of 3.200 billion. The June budget deficit was the most significant in the last 4 years, which is very alarming, considering that the country is on the threshold of Brexit. Investors continue to follow the election of the Prime Minister. According to available data, Boris Johnson is still the leader of the race. The results of the election of the new leader of the Conservative Party and the Prime Minister of Great Britain will be known this week.

AUD/USD

The Australian dollar retreated from local highs against the US dollar on July 19. The decline of the instrument was technical in nature, while the macroeconomic and news background remained ambiguous. Further growth of the Australian currency is hampered by the lack of progress in the US-China trade negotiations. Despite the optimistic start, at present, the parties have not been able to achieve any progress, and the market does not seem to really believe in a favorable outcome of the event. Today, the pair is trading in both directions, and AUD expects new drivers to appear on the market.

USD/JPY

The US dollar showed growth against the Japanese yen on July 19, departing from local minima updated the day before. The development of upward dynamics in the instrument was facilitated by relatively weak macroeconomic publications from Japan. Investors were disappointed with data that indicated a slowdown in consumer inflation. The Tokyo consumer price index excluding the price of fresh food in June expectedly slowed down from 0.8% YoY to 0.6% YoY. The indicator excluding energy prices, increased by 0.5% YoY, which turned out to be weaker than the forecast of 0.6% YoY. The activity index in all industries in May slowed down from 0.8% MoM to 0.3% MoM, which, however, turned out to be better than expectations of −0.2% MoM. Today, the pair continues to develop upward dynamics. At the beginning of the week, investors are focused on the speech of the head of the Bank of Japan Haruhiko Kuroda.

Oil

Oil prices rose slightly on July 19, corrected from local minima, updated the day before. Moderate support for quotes was provided by the US reports on the destruction of the Iranian drone in the Gulf of Mexico, which again heightened tensions in the Middle East. Additional support for the prices was provided by speeches of Fed representatives who favored a rapid reduction in interest rates. Finally, the published Baker Hughes report on active oil platforms in the United States reflected a reduction in the number of drilling rigs from 784 to 779 units.
 

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Morning Market Review
2019-07-23 08:26 (GMT+2)
EUR/USD

The euro showed a moderate decline against the US dollar on July 22, continuing the development of a strong "bearish" impulse formed on Friday. Monday's macroeconomic background remained insignificant; therefore, investors were still focused on the upcoming meetings of the world central banks. On Thursday, the ECB will publish the minutes of its meeting. Given the negative macroeconomic statistics and rather gloomy prospects for the world economy, it is likely that the European regulator is announcing a new interest rate cut. However, the likelihood of such an outcome just exceeded 50%, so the intrigue remains. On Tuesday, the market expects the publication of data on bank lending in the Eurozone and preliminary statistics on the level of consumer confidence.

GBP/USD

The British pound is trading in a downward trend against the US dollar, developing a correction formed at the end of last week. The pound remains pressured amid uncertain prospects around Brexit. Today we will know the name of the new prime minister, who, following Theresa May, will have to deal with the issue of concluding an agreement with the EU. Chances are high that the new prime minister will be former foreign minister, Boris Johnson, who has previously actively advocated a "tough" Brexit if the EU does not make concessions on the Irish border. On Tuesday, investors are also awaiting the publication of the minutes of the Financial Policy Committee meeting and the CBI report on changes in the volume of industrial orders in July.

AUD/USD

The Australian dollar showed ambiguous dynamics against the US dollar on Monday, retaining the "bearish" impulse formed at the end of last week. AUD is pressured by a tense situation around the US-China trade negotiations, which again come to a standstill. Investors are also awaiting a Fed meeting at the end of July, which could result in interest rates lowering. The speeches of the official representatives of the regulator at the end of the week provoked a fairly strong correction in favor of USD, and now conversations are about the scale of the upcoming easing, rather than about the fact of the rate cut.

USD/JPY

The US dollar has been rising against the Japanese yen since the end of last week, recovering from local lows of June 26, updated last Thursday. On Monday, investors were focused on the speech of the head of the Bank of Japan, Haruhiko Kuroda, who reaffirmed his readiness to resume economic stimulation in the event of further growth in global uncertainty. In addition, Kuroda is ready for additional monetary easing to achieve a target inflation rate of 2%. Today, the pair is trading in an uptrend. Market participants are waiting for the publication of US macroeconomic statistics. The focus will be on Redbook statistics on retail sales, as well as the dynamics of sales in the secondary housing market.

Oil

Oil prices showed ambiguous dynamics on July 22, closing with almost zero results. Quotes are still supported by growing tensions in the Persian Gulf. Last week, investors reacted violently to the seizure of a British tanker by Iran in response to similar actions by Britain in early July. In turn, the pressure on prices is exerted by a further decline in demand for petroleum products amid a slowdown in global economic growth. Today, in addition to the publication of macroeconomic statistics from the United States, the API report on oil reserves for the week of July 19 is expected. The previous report reflected a decline in stocks by 1.401 million barrels.
 

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Morning Market Review
2019-07-24 08:24 (GMT+2)
EUR/USD

The euro showed a noticeable decline against the US dollar on Tuesday, updating local lows of May 31. The pressure on EUR was exerted by the negative prospects of Brexit, as well as the statements of US President Donald Trump, who noted that "in trade matters, the EU is worse than China." Investors fear the escalation of the US-EU trade conflict since it is not the first time when Trump is trying to impose additional duties on European goods. Published macroeconomic statistics was ambiguous. Sales in the US secondary housing market in June fell by 1.7% after rising by 2.9% MoM last month. Analysts were expecting a decline of only 0.2% MoM. Richmond Fed Manufacturing Index in July dropped sharply from 3 to −12 points, with the forecast for growth to 5 points. European statistics reflected a slight increase in consumer confidence from −7.2 to −6.6 points, with a constant forecast.

GBP/USD

The pound showed a decline against the US dollar on July 23. The focus was on voting on the candidacy of the leader of the Conservative Party. As expected, former Foreign Minister Boris Johnson won a landslide victory and is now to take the post of prime minister. Markets reacted rather pessimistically since Johnson is known for his tough position on Brexit, which increases the risk of a country leaving the EU without an agreement. Today the pair is trading ambiguously, waiting for the appearance of new drivers. On Wednesday, data on business activity in the US in July, as well as statistics on the dynamics of approved mortgage loans in the UK in June will be published.

AUD/USD

The Australian dollar showed a steady decline against the US dollar on Tuesday and today maintains an active negative trend. Yesterday, AUD was pressured despite the publication of weak macroeconomic statistics on the US secondary housing market sales. Investors are frightened by the prospects for the development of a new trade conflict involving the USA, this time with the EU. This can negatively affect the world economy, given that the US-China negotiations have not yet led to a positive result. Donald Trump’s statements that he was able to hold a series of successful negotiations with congressmen on the sovereign debt ceiling also provided moderate support to the US dollar. If the decision is approved in Congress, it will allow the US government to work until 2021.

USD/JPY

The US dollar showed a moderate increase against the Japanese yen on Tuesday, updating local highs of July 17. It is curious that the growth of USD proceeded against the background of the publication of rather weak statistics on the housing market. The yen is still pressured by the uncertain situation around the prospects of monetary policy easing by the Bank of Japan. Today, the pair is trading in both directions. Minor support for the yen provides Japanese data on Manufacturing PMI. In July, according to preliminary estimates, the figure rose from 49.3 to 49.6 points, which was only 0.1 points worse than expected.

Oil

Oil prices showed a moderate increase on July 23, despite the fact that "bearish" sentiment prevailed during the day. Quotes were strongly supported by the API report on oil reserves published on Tuesday. For the week of July 19, stocks fell sharply by 10.961 million barrels after declining by 1.401 million over the past period. On Wednesday, investors are awaiting the publication of an official report on oil reserves from the US Department of Energy.
 

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Morning Market Review
2019-07-25 08:23 (GMT+2)
EUR/USD

The euro maintains negative dynamics against the US dollar, updating local minima of May 31. EUR is pressured by weak macroeconomic statistics, as well as the strengthening of the dollar amid progress in the US-China trade negotiations. Published yesterday, the European statistics on the business activity was below market expectations. The Markit Manufacturing PMI in Germany in July fell from 45.0 to 43.1 points, with the forecast of growth to 45.2 points. The composite Manufacturing PMI in the Eurozone for the same period decreased from 52.2 to 51.5 point, with a forecast of 52.1 points. The Markit Services PMI fell from 53.6 to 53.3 points, which coincided with the preliminary estimates of experts. Today the pair is trading ambiguously, waiting for the appearance of new drivers. Investors are focused on the ECB meeting, which is expected to clarify the prospects for a possible easing of monetary policy.

GBP/USD

The pound showed quite active growth against the US dollar on July 24, recovering from a three-day decline. The reason for the emergence of positive dynamics were hopes for changes in the situation around Brexit after the new British Prime Minister Boris Johnson took office. The British currency received additional support from the euro, which is weakening amid disappointing macroeconomic statistics on the business activity ahead of the ECB meeting. The US data also proved ambiguous. The Markit Manufacturing PMI in July showed a decline from 50.6 to 50.0 points, while the forecast was 51.0 points. The composite PMI in July showed a slight increase from 51.5 to 51.6 points, not reaching forecasts of 52.1 points.

AUD/USD

The Australian dollar is steadily falling against the US currency, updating local minima since July 11. The instrument is pressured by relatively weak macroeconomic statistics from Australia, while consumer sentiment on USD is supported by insignificant progress in the US-China trade negotiations. Published yesterday, the data on Australian business activity from Commonwealth Bank reflected the preservation of negative dynamics. The Services PMI in July fell from 52.6 to 51.9 points. The Manufacturing PMI fell from 52.0 to 51.4 points. The composite index, according to preliminary estimates, fell from 52.5 to 51.8 points.

USD/JPY

The US dollar, having updated local maxima against the Japanese yen of July 17, tends to horizontal movement. The dollar is pressured by uncertain US macroeconomic statistics, which is to some extent true for the Japanese currency. Published yesterday, statistics from Japan was worse than expected. The Manufacturing PMI in July rose from 49.3 to 49.6 points, with a forecast of 49.7 points. The index of leading indicators in May fell from 95.9 to 94.9 points, contrary to expectations of a decline only to 95.2 points. The exception was the index of coincident indicators, which in May rose from 102.1 to 103.4 points, above the forecast of 103.2 points.

Oil

Oil prices showed a decline July 24, despite the fact that during the day the instrument showed a moderate increase. Confident support for the quotes was provided by the EIA oil reserves report. For the week of July 19, oil and petroleum products in the United States fell sharply by 10.835 million barrels after a decrease of 3.116 million over the previous period. Analysts expected a decrease of −4.011 million. The EIA report almost completely coincided with the API data that appeared the day before. The report also reflected the decline in oil production in the USA from 12.000 million to 11.300 million barrels per day. Additional price support is provided by the continuing tension in the Middle East.
 

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Morning Market Review
2019-07-29 08:38 (GMT+2)
EUR/USD

EUR showed a moderate decline against USD on July 26, approaching the record lows of May 2017, updated the day before. The development of the "bearish" dynamics of the instrument was facilitated by not the strongest macroeconomic data from Europe. The German Import Price Index in June fell by 1.4% MoM and 2.0% YoY, which was significantly worse than market expectations (–0.8% MoM and –1.5% YoY). In turn, the data published in the US was able to provide moderate support to USD. Preliminary estimates reflected a slowdown in the US economy in Q2 2019 from +3.1% to +2.1% YoY, which turned out to be somewhat better than market expectations of +1.8% YoY. Pressure on EUR is also exerted by the prospect of another monetary policy easing by the ECB, which is not straightforward yet. It is likely that the regulator will decide on new interest rate reductions only in the first half of 2020.

GBP/USD

GBP declined significantly against USD on Friday, updating local lows of April 2017. British investors are still focused on Boris Johnson's victory in the elections. The new head of the Conservative Party is still engaged in the selection of the government and has not yet noted any concrete steps in the Brexit issue, but the market is very negative. In particular, investors draw attention to the criticism of Johnson by the Minister for Foreign Affairs of Ireland. During the Asian session on July 29, the instrument is trading ambiguously, waiting for new drivers to appear at the market. A large block of macroeconomic statistics from the UK is planned to be published today. The first in line will be the data on Nationwide House price index. The statistics on BoE Consumer Credit and Mortgage Approvals in June are also expected to be released.

AUD/USD

AUD closed on Friday with a steady decline against USD, updating local lows of June 21. At the end of last week, there were no interesting macroeconomic statistics from Australia; therefore, the movement of the instrument was largely technical. In turn, the data on the dynamics of US GDP for Q2 2019 contributed to the preservation of the "bearish" dynamics. Contrary to forecasts of a slowdown in the US economy to +1.8% YoY, real data indicated an increase of +2.1% YoY, which may be a signal in favor of maintaining the current monetary policy at the Fed meeting at the end of the month. On Wednesday, July 31, investors are also awaiting the publication of important statistics on the dynamics of consumer inflation in Australia for Q2 2019.

USD/JPY

USD showed insignificant growth against JPY on Friday, having updated local highs of July 10. The development of ambiguous trading dynamics was promoted by macroeconomic publications from Japan and the USA, as well as the fact of fixing long profits after the rally of the dollar last week. During the Asian session on July 29, the pair is trading in both directions. The focus of investors is on the retail sales data in Japan. In June, sales volumes showed zero dynamics on a monthly basis, after rising by 0.4% MoM last month. Analysts expected the increase of +0.8% MoM. In annual terms, the increase has slowed from +1.3% YoY to +0.5% YoY, with the forecast of +0.2% YoY.

Oil

Oil prices showed ambiguous trading dynamics at the end of last week, as the growth of tensions in the Middle East was held back by signals of a slowdown in US economic growth. Despite the fact that Friday's data on US GDP for Q2 2019 turned out to be better than expected (+2.1% YoY against the forecast of +1.8% YoY), the slowdown rate is quite noticeable, therefore one can still expect steps aimed at stimulating the national economy by the Fed. Baker Hughes report on active oil platforms in the US published last Friday showed moderate support for quotations, indicating a further reduction in the number of drilling rigs from 779 to 776 units.
 

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Morning Market Review
2019-07-31 08:39 (GMT+2)
EUR/USD

The European currency showed ambiguous trading against the US dollar on Tuesday. The controversial macroeconomic releases from Europe contributed to the decline of EUR, while further growth of USD was hampered by the expectation of lowering the interest rate by the Fed at its meeting on Wednesday, July 31. Industrial Sentiment in the euro area in July showed a decrease to –7.4 points from –5.6 points last month. Analysts expected a decrease to –7.0 points. Business Climate in the euro area in July fell from 0.17 to –0.12 points, which also turned out to be worse than market forecasts of 0.08 points. The data from France were also disappointing. According to preliminary estimates, French GDP in Q2 2019 slowed down from +0.3% QoQ to +0.2% QoQ. French Consumer Spending in June showed a decline of 0.1% MoM after rising by 0.3% MoM last month. On Wednesday, in addition to the minutes of the Fed meeting, the data on euro area's GDP for Q2 2019 and Consumer Price Index for July are expected.

GBP/USD

GBP showed a decrease against USD on Tuesday, having updated the record lows of March 14, 2017. Closer to the end of the afternoon session, the instrument was still able to slightly correct, which was caused by the profit taking before the Fed meeting, at which the interest rate can be reduced by 0.25 or 0.50 points. Minor support for the pound on Wednesday is provided by data on Consumer Confidence in the UK. In July, according to the data from Gfk, the index rose from –13 to –11 points, while the forecast did not suggest changes in the indicator. During the day, investors expect the release of Nationwide Housing Price Index for July.

AUD/USD

AUD showed a moderate decline against USD on Tuesday, having updated local lows of June 19. During today's Asian session, the pair shows active growth, caused by the expectation of lowering the interest rate by the Fed and the publication of a number of good macroeconomic data from Australia. Australia's Consumer Price Index in Q2 2019 showed an increase of 0.6% QoQ and 1.6% YoY, which was slightly better than market expectations (+0.5% QoQ and +1.5% YoY). In the past quarter the index showed an even more modest growth of +0.0% QoQ and +1.3% YoY.

USD/JPY

USD ended the session on Tuesday with a moderate decline against JPY, departing from its local highs of July 10. The correction of the instrument proceeded against the background of disappointing macroeconomic data from Japan on industrial production and the release of the minutes of the Bank of Japan meeting on the interest rate. As expected, the regulator did not change interest rates, confirming its previous intentions. The Bank of Japan has not announced any new stimulation measures for the national economy. During the Asian session on July 31, the pair is trading in both directions. Minor support to the yen is provided by the Housing Starts indicator in Japan. In June, it showed an increase of 0.3% YoY after a decline of 8.7% YoY last month. Analysts expected a decline of –3.4% YoY.

Oil

Oil prices showed a moderate increase on Tuesday, supported by the expectation of lowering the interest rate by the Fed for the first time in 10 years. Moreover, some experts believe that the Fed may decide to cut the rate by 0.50 points, since the economic situation is noticeably worsening, and earlier Donald Trump stated that “a small reduction in the rate will not be enough”. Additional support to prices on Tuesday was provided by the API Weekly Crude Oil Stock report. For the week as of July 26, the report reflected a decrease in stocks by 6.024 million barrels after a record decline of 10.961 million barrels for the previous period. On Wednesday, investors are awaiting the publication of an official report on oil reserves from the US Department of Energy.
 
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