The Fed is ready to start tapering in November. Since the markets were expecting this and it wasn’t a surprise, the USD slumped allowing risk-on currencies and gold to rally up.
Forex today: easing geopolitical tensions
- Safe havens such as gold and Japanese yen declined as investors sentiment was boosted by eased geopolitical tensions. During the summit between US President Mr. Trump and Japanese Prime Minister Mr. Abe, Donald Trump announced that the US and North Korea had talks at “extremely high levels” about the North Korean nuclear weapons program. Leaders of two countries plan to meet in the next two months.
- As a result, the yen dipped. The USD/JPY came to standstill at 107 and rebounded. The pair is moving to the resistance at 107.50. Ichimoku cloud is signaling the downward movement. So the support is still at 107. If the pair breaks it, the 50-day MA at 106.60 will be the next level of support.
- Gold is declining as well. Gold futures are trading near 1348.
- The US dollar is rising. Yesterday the greenback plunged lower $89 but managed to rebound. Eased geopolitical tensions supported the USD. Now the US dollar futures index is trading within the usual rate around 89.30.
- The Canadian dollar is depreciating ahead of the interest rate’s release that will be released today at 17:00 MT time. The BOC is not anticipated to change the interest rate. The USD/CAD pair reached the support at 1.2540 and rebounded. USD/CAD is trading around 1.2580. The resistance lies at 1.2620 (200-day MA).
- The pound plunged. Yesterday the GBP/USD pair reached the resistance at 1.4347 but could not break it and fell. A lot of UK economic data were released today. All important indicators declined that strengthened the pound’s fall.
The pair has broken two levels of support: at 1.4253 and 1.4221. The next support is at 1.4160.
- Good time for the stock market. The US earning season is ramping up supporting the stocks’ rise. Encouraging earnings data are even overshadowing renewed trade wars tensions (as the US banned American firms from selling parts and software to China’s ZTE Corp, China retaliated with agricultural duties).
- Oil is climbing. Brent and WTI were supported by the negative news on US crude oil inventories. An official report on the number of crude inventories in the US will be released today at 17:30 MT time but the forecast is negative. Moreover, the American Petroleum Institute has already reported a decrease of 1.05 million barrels last week. Brent is near $72 a barrel, WTI is near $67 a barrel.
However, according to estimations, rising prices will lead to the reduction of demand. An important event for the oil market is the meeting of the OPEC and its allies including Russia on April 20. Let’s look whether they are able to find a solution for the volatile market.
- Despite the forecast that bitcoin will reach the bottom after April 17, the cryptocurrency is rising. Bitcoin is again above $8,000. The next important level it needs to break is $8,400.
That is all for today. Follow markets news with us!
US Retail Sales will be out on October 15 at 15:30 MetaTrader time (GMT+3).
The crypto market keeps recovering. Bitcoin has broken above $57,000. The way up to $60,000 is open now!
The United States will release the weekly Unemployment Claims on October 21, at 15:30 MT time (GMT+3).
Great Britain will publish the Inflation Rate on October 20, at 09:00 MT time (GMT+3).
The bullish movement in the stock market is gaining speed, and Bitcoin ETFs are closer than they might seem. What do we need to know for the next trading week?