ONLINE FOREX BROKER
2019-11-11 • Updated
It has not been a big session if we refer to the price actions. As the US markets were closed yesterday for the Independence Day holiday, today’s and overnight’s liquidity was thinner than normal elsewhere. The largest moves were registered in AUD/USD and USD/JPY.
Aussie negatively reacted to the RBA’s “no change” in the monetary policy settings. While everybody expected a board leaving its cash rate on hold, the market participants waited something that could be inferred as at least having a partly hawkish tilt. The Reserve Bank of Australia’s officials hardly moved away from their neutral stance, remained cautious of subdued real wage growth and housing markets, refused to remove their monetary accommodation.
The yen gained some strength following the escalation of the conflict on the Korean peninsula. North Korea conducted a test of its new intercontinental ballistic missile that can carry a large and heavy nuclear warhead. South Korea and the US responded with firing missiles to show the deep strike precision of their weaponry.
USD/JPY swiftly slipped 112.70 following the missile launches. Not it is trading near 113.20. There is a strong resistance ahead lying at 113.50 which if broken may push the quotes even higher. On the downside, we suggest targeting the support at 112.20.
The euro skipped some points overnight as the ECB’ chiefs Peter Praet and Nowotny failed to surprise markets with their speeches. Economist Praet said that the bank’s inflation forecasts are “crucially contingent” on very easy financing conditions (there is no even a hint for a hawkish tilt as you see). Governing Council member (interest rate setter) Nowotny noted that normalization of the extremely loose policy will be conducted as soon as economy allows, possibly the ECB will be a bit more hawkish, but nor overly so. EUR/USD is at 1.3555 now a bit higher from yesterday’s low. While short-term downward pressure has waned somewhat, a further move below 1.3330 is still not ruled out. On the upside, there are some resistances at 1.3350/1.3400 levels. In the European session later today, we will get the second estimates of the European countries’ services PMI and monthly update of the European retail sales. The key focus will be on the Fed’s meeting minutes, though, which are due at 9:00 pm MT time. We don’t expect they might surprise markets somehow; there has been already a full exposition of the Fed’s QE wind-down process. But we will see what they bring us.
USD/CAD ticked a bit higher in Tokyo morning to 1.2945 after falling to 1.2907 in the course of the past few sessions due to hawkish commentary from BoC Governor Stephen Poloz. Canadian rate hike is now priced in a 87% chance (the rate decision will be delivered next week on Wednesday). Oil prices were trying hard to stabilize around $50 per barrel. Brent oil futures are now at $49.55 one pip higher from its weekly opening price. It may slide lower from the current levels in the absence of data/event stimuli.
NZD/USD fell 0.7260 overnight on the marginally lower dairy prices. In the Asian session, kiwi added some points and moved higher to 0.7286.
The EU plans to intervene in markets directly to curb rising energy costs, threatening to push the Euro area's economy into a deep recession.
US oil exports reached a record last week at five million barrels a day, according to Energy Information Administration data…
The past two years have seen the biggest swings in oil prices in 14 years, which have baffled markets, investors, and traders due to geopolitical tensions and the shift towards clean energy.
This week, there are a few high-probability trade ideas I'd like to recommend to you. Trading these setups, be sure to implement a proper risk management approach.
On Thursday, the 2nd of February, the Bank of England will publish its report concerning interest rates and inflation data for the Eurozone. Professionals and investors anticipate that Andrew Bailey’s lead team of policy makers will likely raise interest rates to 4%; the highest in over a decade, for the tenth time in a row.
The first FOMC meeting comes after a buildup of anticipation from traders and investors alike, as the markets await what posture the Fed will take regarding the interest rates; would there be a hike or a cut in interest rates?
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