The market takes breath after the long rally. What opportunities do traders have today?
Forex today: geopolitical issues are in the arena
- The US dollar is falling further. Although such important data as CPI and Core CPI will be released today (15:30 MT time), traders do not consider them as an important factor for the greenback. However, if the data is greater than anticipated, the US dollar has chances to grow. The US dollar index futures are trading around 89.20.
- The AUD is depreciating against the USD. Westpac consumer sentiment appeared to be negative (-0.6% vs 2%). Moreover, today’s speech of the RBA’s Governor Mr. Lowe affected the aussie’s rate. The Governor warned that trade wars would damage the Australian economy. Furthermore, according to Mr. Lowe, the accommodative policy will remain unchanged for some time yet as the central bank does not see a strong case for changes. Let us remember that the RBA is keeping the interest rate on hold at a record low of 1.50%. The AUD/USD pair is still trading above the pivot point (0.7739). If the pair breaks this level, we can anticipate the further fall to the support at 0.7711.
- Trade wars tensions eased, however, geopolitical issues continue to weigh on markets. The situation with airstrikes in Syria is still unsolved. Mr. Trump is preparing a response to the attack in Syria accusing Syria’s leader B. Assad of attacks and considering Russia’s involvement. Mr. Trump has already negotiated with UK PM Teresa May and French president Emmanuel Macron. The behavior of Mr. Trump will lead to the escalation of the Syrian conflict. Moreover, Mr. Trump canceled his trip to the summit of the Americas in Peru.
The USD/JPY pair reacted to the geopolitical tensions. Yesterday the pair reached the resistance at 107.35, but could not break it and rebounded. Now the USD/JPY is trading near 107. 50-day MA (near 106.85) will play a role of the support. If today’s US data is weak and political tensions increase, the USD/JPY will break the support and move to the next one at 106.60.
- The pound is climbing to the resistance at 1.4245. Today investors are anticipating UK economic indicators such as manufacturing production m/m, goods trade balance, construction output m/m, industrial production m/m, and NIESR GDP Estimate. If actual data are greater than forecast ones, the GBP will reach the resistance. Chances of the break of the resistance are not high as the resistance is too strong (supported by 200-week MA). If no crucial events for the pound happen, the GBP/USD pair will turn around.
- The euro is continuing to move upward. The single currency managed to reach the resistance at 1.2387 but rebounded. No crucial data for the euro is anticipated today, however, the ECB’s president Mr. Draghi will give a speech at the Generation €uro Students’ Award Ceremony in Frankfurt. Audience questions expected.
- Bitcoin is still below $7,000. The digital currency is trading at $6,845. The lack of positive news does not let bitcoin break the psychological level of $7,000. However, some future events may support the cryptocurrency. First of all, the week of tax payments in the US will end soon. Secondly, if such a huge investor as Mr. Soros comes to the cryptocurrency market, it may lead to the bitcoin’s appreciation.
- Oil lost some points, however, it still shows positive figures. Yesterday Brent reached the highest level ($71.33) since December 2014, today the benchmark is trading close to $70.50. WTI was trading near $66. Today the benchmark is close to $65.20.
- Gold is rising as world tensions do not slow down. The yellow metal is trading near 1,347 an ounce. If it is able to close above this level, the resistance will lie at 1,352.50.
That is all for today. Follow markets news with us!
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Riskier currencies and stocks are in favor of investors. Surprisingly, gold rallies too. Let’s have a closer look.
Congratulations! Gold has just opened a new era... or, rather, reopened...