The Bitcoin “death cross” has occurred. The S&P 500 rallied the most in five weeks! Crude oil and gold jumped as the US dollar weakened.
How to trade on August 18?
Risk-on is back on the market. The US dollar is dipping down, while riskier currencies and stocks are rising.
- The pressure between the USA and China mounts. US officials imposed new restrictions on Huawei Technologies. They added to the US blacklist 38 Huawei affiliates in 21 countries.
- China has started an anti-dumping investigation into imports of wine from Australia. In addition, this morning the RBA released minutes of the last monetary policy meeting. The tone was quite dovish. Nevertheless, even the combination of US-Australian tensions and the dovish RBA statement hardly weighed on the Australian dollar. It keeps rallying amid the improved market sentiment.
- Traders are waiting for Washington to unveil the next fiscal stimulus. Analysts believe that now the market is not yet fully risk-on. The stimulus package will add more optimism.
EUR/USD has approached the key resistance at 1.9000, which it has touched a few times already. The price is likely to bounce off this level. However, if it manages to break through, it may jump to the next resistance at 1.1950. Support levels are at the low of August 17 at 1.1840 and at the key psychological mark at 1.1800.
S&P 500 has failed to cross the all-time high at 3 390, but it stays really near that level. If it breaks down the low of August 11 at 3 335, it may fall even deeper to the next support at 3 270.Gold
XAU/USD has just broken through the $2 000 level. If it crosses the resistance at $2 035, it may jump higher to the record high at $2 070. On the flip side, if breaks down the 50 moving average on the 4 hour-chart at $1 985, it may fall deeper to the next support at $1 965.
USD/JPY has touched the 23.6% Fibonacci level at 105.50. If it manages to break it through, it may fall to the low of March 11 at 104.40. On the upside there are resistances at 107.00 and 107.70. Follow further news!
Wednesday will please traders as many economic indicators will be out! The USA, UK, and Euro Area will release PMI reports on June 23 from 10:15 to 16:45 MT.
Last week the USD soared versus other major currencies, while gold headed for the biggest weekly loss in 15 months. Let’s see what new moves await us this week!
US PCE Price Index will be out on Friday at 15:30 MT.
Microsoft joined Apple in the $2 trillion dollar club! Follow PMI reports from the US, UK, and EU throughout the day!
The Bank of England will release its statement and announce its monetary policy decision on June 24 at 14:00 MT.