Categories
Forex News

ForexLive Americas FX news wrap: Trump goes easy on China – ForexLive

Forex news for North American trade on May 29, 2020:

Markets:

  • Gold up $14 to $1732
  • WTI crude oil up $1.28 to $35.00
  • US 10-year yields down 4.3 bps to 0.65%
  • S&P 500 +0.5%
  • AUD leads, NZD lags

The main event of the day was China and Trump’s planned announcement to retaliate for the Hong Kong security law. That kept markets on edge and erased an early positive tone in risk assets.

As he began to speak and launched some tough talk, risk trades sagged but when it came time to deliver the US reaction, it was meek. All the announcements related to things that were leaked or rumored previously and stocks quickly rebounded along with commodity FX.

Earlier in the day it was all about flows. It was the final trading day of the month and there was a big bid in EUR/GBP and GBP/USD. The fixing demand arrived but sellers met it and both pairs sagged. Cable fell a full cent from the highs and as in negative territory on the day before a late bounce to a 16 pip daily gain.

The euro will close the week close to 1.1100 and that’s comfortably above the key 1.1020 zone but off the 1.1145 session high.

When you check the broader rundown in the market there wasn’t much to report in terms of daily moves in FX with most pairs finishing about 20 pips from starting levels. AUD had a bit more jam but the highs came early in Europe.

The gold and oil markets were more-lively as both were bid into month-end. Oil was quiet until the final hour of trading when a big bid came through ahead of the monthly fix. Gold rebounded for the second day then briefly dipped after Trump but was picked up again late.

Forex news for North American trade on May 29, 2020:
Categories
Forex News

FOREX-Dollar weak vs. euro; Trump news conference on China on tap – Reuters

* Trump plans China news conference for Friday

* Sterling steady vs. Euro ahead of Brexit talks next week (New throughout, updates prices, market activity, comments to U.S. market open; previous LONDON)

By Saqib Iqbal Ahmed

NEW YORK, May 29 (Reuters) – The dollar extended its slide against a surging euro on Friday, hurt by month-end flows and as the common currency continued to enjoy a boost from the European Union’s recently announced plan to prop up the bloc’s coronavirus-hit economies with a 750 billion-euro ($828 billion) recovery fund.

The dollar, a safe-haven currency, found some support as traders awaited U.S. President Donald Trump’s response to China’s tightening control over Hong Kong, which could worsen tensions between the two powers over the financial hub.

The euro was 0.32% higher at $1.1112, on pace for its fourth straight day of gains. The euro’s rally this week has pushed it over its 200-day moving average for the first time since late March and lifted it about 2% for the week, its best weekly gain in nine weeks.

Much of the euro’s move was driven by optimism generated by the European Commission’s stimulus plan announced earlier this week, as well as investors’ improved appetite for risk-taking as global economies gradually move to reopen after coronavirus-linked shutdowns, analysts said.

Month-end adjustments to portfolio hedges, after a more than 3% rally in May for U.S. stocks, was also weighing on the dollar, said Stephen Innes, chief global markets strategist at AxiCorp.

“The 3%-plus jump in equities this month suggests a medium-sized USD sell program into month-end,” said Innes.

The euro was also helped by data that showed inflation continued to slow on crashing oil prices but underlying price growth held steady, a hopeful sign for European Central Bank policymakers trying to stave off deflation.

With Trump due to announce later on Friday his response to the Chinese parliament’s advancement this week of security legislation for Hong Kong – which many lawyers, diplomats and investors fear could erode the city’s freedoms – the dollar’s losses were limited.

“I think the market is still fearful that it might escalate into something more serious. If he was serious with trade tariffs, that would have a meaningful impact”, said Moh Siong Sim, a currency strategist at Bank of Singapore.

The pound was about flat against the euro and the dollar ahead of a new round of Brexit talks next week.

Reporting by Saqib Iqbal Ahmed; additional reporting by Julien Ponthus and Tom Westbroolk; editing by Jonathan Oatis

Categories
Forex News

RBA meets as Australia reopens for business, aussie rallies – Forex News Preview – XM


Raffi Boyadjian, XM Investment Research Desk

The Reserve Bank of Australia is scheduled to hold a policy meeting on Tuesday with an announcement expected at 05:30 GMT. A day later, the GDP growth estimate for the first quarter is due at 01:30 GMT, making it an important week for the very bullish looking Australian dollar. However, with the growth picture improving fast and investors already having made up their minds that the virus hit on the Australian economy won’t be as severe as initially feared, next week’s events might not be much of a game changer. That is of course assuming that tensions with China remain tempered.

Is RBA done with QE?

It’s only been a couple of months since it launched its first ever quantitative easing (QE) program and the RBA has already begun winding down its purchases of Australian government bonds. In contrast, other central banks, including next door neighbour – the Reserve Bank of New Zealand – have either increased or are likely to increase their asset purchases in the coming months.

Although the RBA targeting the yield curve as opposed to setting outright targets on the amount of bonds it buys may be one reason why Australia has not had to intervene as heavily in the bond market, another reason is the quicker turnaround in the economic outlook, which has helped bond yields stabilize.

Virus impact not as great as feared

Australia stands out as one of the few countries that managed to contain the spread of the coronavirus very quickly and has one of the lowest per capita death rates. That has allowed it to begin reopening its economy with less risk of a second wave than some other countries that are deemed to have lifted lockdown restrictions too early like the United States. It also means the economic and health toll on the country has not been as high as first predicted.

To give an example, the government recently revised its estimate of how much the JobSeeker scheme – a program of subsidizing workers’ wages to minimize layoffs – will cost, saying it now expects to make savings of A$60 billion as far fewer people have signed up to it than had been originally anticipated. Australia is also in the advantageous position of most of its exports going to China, which was the first country to enter a lockdown and therefore also the first to exit it.

A mild recession?

Add to that the pickup in growth at the start of the year when the US and China had just reached a trade deal, and Q1 GDP is not expected to have declined as steeply in Australia as has been reported in other advanced economies. Forecasts are for economic output to have shrunk by just 0.3% in the March quarter, with year-on-year growth remaining positive at 1.4% but down from 2.2% in Q4. Although there is little doubt that the numbers will get much uglier in Q2 (as suggested by preliminary retail sales numbers for April), there are signs that the downturn will not be as deep as earlier projections.

RBA Governor Philip Lowe has said employment is now expected to decline by 15% instead of 20%, though he does warn that the outlook remains “incredibly uncertain”. What is more certain, however, is that Lowe and his colleagues will keep monetary policy unchanged on Tuesday.

Pressure for more fiscal stimulus

In fact, it’s looking less and less likely that there will be any additional stimulus coming from the RBA. That applies not only to the possibility of further reductions in the cash rate – negative interest rates are almost out of the question in Australia – but also on the likelihood of more QE. While not ruling out increasing QE, Lowe appears to be shifting the burden of supporting the economy onto the government, telling lawmakers “fiscal policy will have to play a greater part than in the past”.

All this has propelled the Australian dollar to 2½-month highs versus the mighty greenback, with the improved risk tone in the broader markets further underlining the currency’s bullish performance since bottoming at 17-year lows in late March.

Aussie on the verge of breaking past 200-day MA

If the RBA does not signal any additional easing as expected and there are no negative surprises in the GDP readings, it should be no trouble for the aussie to break above the 200-day moving average in the $0.6655 area. Clearing this hurdle would set the stage for the $0.6750 and $0.6805 levels, both of which were congested regions in the past.

To the downside, a retreat towards the latest swing low of $0.6504 is possible if the RBA is more dovish than anticipated and/or the GDP data casts doubt about the economy’s resilience.

However, a bigger downside risk is likely to come from any further flare up in US-China tensions that threatens to upset the trade truce, while a souring in Sino-Australian relations cannot be dismissed either. China appears to be increasingly frustrated with Australia’s foreign policy stance, specifically, for backing the US over key issues such as Huawei’s alleged security threat and the Chinese government’s handling of the virus outbreak. With Australia not about to soften its hard-line approach to China, the risk that markets are caught off guard by tougher Chinese retaliation than the limited and selective trade restrictions announced so far is uncomfortably high.

Categories
Forex News

ForexLive European FX news wrap: Softer dollar as markets wait on Trump – ForexLive

Forex news from the European trading session – 29 May 2020

Headlines:

Markets:

  • EUR leads, USD lags on the day
  • European equities lower; E-minis down 0.3%
  • US 10-year yields down 2.6 bps to 0.664%
  • Gold up 0.6% to $1,728.30
  • WTI down 2.6% to $32.83
  • Bitcoin down 0.5% to $9,402

EOD 29-05
The session had a couple of notable headlines but the market remains largely sidelined, but in a cautious manner, awaiting from US president Trump’s speech on China later today.

Equities kept slightly weaker while Treasury yields are also sitting lower amid the more defensive mood in the market in anticipation of the key risk event.

That said, major currencies did have some decent moves but the common theme is that of dollar weakness with chatter of month-end rebalancing coming into play.

EUR/USD nudged higher to fresh highs since late March, rising from 1.1090 to 1.1140. We also saw USD/JPY fall to near two-week lows in a drop from 107.40 to 107.10 levels.

Rsk currencies have been a little more resilient as well despite the cautious mood with AUD/USD rising from 0.6630 to 0.6667 – trying to get above its 200-day moving average.

The pound had a bit of a tricky session with EUR/GBP rising to fresh two-month highs above 0.9000 dragging the quid lower initially, with cable falling back just under 1.2300 before coming back up now to near 1.2350 levels ahead of North American trading.

All eyes are on Trump’s speech later today but before that we will be hearing from Fed chair Powell so let’s see what either of them will deliver for markets ahead of the weekend.

Categories
Forex News

US Dollar Set to Post Weekly Loss Against Major Currencies – Forex News by FX Leaders – FX Leaders

Early on Friday, the US dollar is trading cautious, stuck in a tight range, as markets await US President Donald Trump’s response to China’s passing of the national security bill on Hong Kong. At the time of writing, the US dollar index DXY is trading around 98.37.

Earlier this week, Trump had threatened that he would announce retaliatory measures against China if it passed the legislation, which are sure to increase tensions between the two world leaders. On Thursday, the Chinese parliament approved this legislation and in response, Trump has announced that he would be revealing his plans via a news conference today.

Even though the prospect of US-China tensions keeps its safe haven appeal supported, the US dollar is set to post a weekly loss so far as traders moved towards riskier currencies over rising optimism about economies reopening and the recently announced stimulus measures in Europe.

Commodity currencies like the AUD and NZD are set for weekly gains against the US dollar as both Australia and New Zealand resumed economic activity after successfully controlling the pandemic across their regions. Meanwhile, the Euro looks all set for the second consecutive weekly gain against the dollar, buoyed by reports about the setting up of a 750 billion euro recovery fund.

Categories
Forex News

Forex Signals Brief for May 29: Can Markets Hold On? – Forex News by FX Leaders – FX Leaders

US Market Wrap

It was another day of less than impressive data out of the US, but for the most part, markets didn’t really seem too worried.

Jobless claims came in at more than 2.1 million for yet another week while continuing claims are still sky-high. At the same time, US GDP was worse than expected at -5.0%, while core durable orders were horribly weak.

For the bulk of the trading session, it appeared equity markets would close in the green again, however, the sellers did end up coming late. More concerns around the state of US-China relations are continuing to boil in the background and is weighing on otherwise positive sentiment at the moment.

The Data Agenda

There will be a little bit of data rolling out on Friday, to round out an otherwise quiet week on the economic calendar.

Early in European trade, the attention will be on Eurozone CPI which is expected to be near on flat at just 0.1%. There will also be a host of secondary releases from some of the member countries.

Later in the US session, we will look to Canada and the USD/CAD as we try to gauge the state of their economy with GDP set for release.

The US is again thin data-wise, but we will all be looking to Fed boss Jerome Powell, as he is speaking late on Friday. His comments haven’t really had much impact lately, as we have been hearing from him regularly and in reality, there is little more to be updated in the short-term.

Forex Signal Update

The FX Leaders Team closed one signal in the green yesterday as our GOLD trade hit our take profit target.

USD/JPY – Active Signal

The USD/JPY hasn’t been able to make much headway at the 108.00 level as the Greenback has weakened across the board, but we remain long.

USD/JPY
USD/JPY – 240min.

Oil – Pending Signal

Right on queue, WTI has bounced and as we said yesterday, is looking bullish. As sentiment continues to improve look for a real test of resistance at $35.

CL
CL – 240min.

Cryptocurrency Update

BTC has remained bullish and is looking like it wants to have another attempt at the $10,000 level.

The strength comes despite the fact that Goldman Sachs came out and suggested ‘Bitcoin was not an asset class,’ which gives us an idea of what the investment bank thinks about the prospects for cryptocurrency. 

BTC
BTC – 240min.
Categories
Forex News

ForexLive Americas FX news wrap: China jitters hit late – ForexLive

Forex news for North American trading on May 28, 2020:

Markets:

  • S&P 500 down 6 poitns to 3029
  • Gold up $9 to $1718
  • WTI crude oil up 67-cents to $33.48
  • US 10-year yields up 1 bps to 0.69%
  • EUR leads, CAD lags

Who would have thought that the market could so easily brush off another 2.1m jobless claims and some of the worst durable goods orders and GDP reports on record and then crumble on an announcement about an announcement? That’s what happened as the positive tone in risk assets evaporated when Trump said he will announce something about China tomorrow, presumably some kind of repercussion for the Hong Kong security law.

Before that AUD/USD made a decent rally to 0.6668 before giving nearly all of it back.

Outside of the general risk trade, the theme on the day was optimism in Europe. Another day of gains in stock markets there helped to finally propel the euro above 1.1020 and there was a non-stop bid in European and North American trade up to 1.1093 before a late 20-pip did.

The pound also brushed off the latest Brexit worries with a solid gain to 1.2325.

Forex news for North American trading on May 28, 2020:
Categories
Forex News

EUR/USD Forex Market Holds at New High Despite Continuing US Unemployment – Securities.io

  • EUR/USD Breaks Back Through Significant Barrier
  • Markets Open Lower As Unemployment Rises
  • Improving PMI also Benefits GBP Market

Millions more filed for unemployment in figures released today for the previous week ending May 16th. This news however did not appear to disrupt the forex trading market at all. Here, the EUR/USD managed to climb back through a significant level at $1.10. Sterling has also been managing to hold ground this week, likely boosted by PMI data moving in the right direction today. Markets still dipped slightly though on this morning’s opening bell.

Euro Moving Back to Stronger Position on USD Weakness

Forex brokers have noted a slight step away from the safe-haven status of the US Dollar this week. The Greenback easing up slightly throughout the week as positive drug trials and similarly supportive comments from Fed Chief Powell on the Reserve’s commitment to backing the American economy have given traders a degree of renewed hope.

This hope has translated to strengthening of the Euro as markets there continue to battle back with improving data which is albeit still at a massively low point. The preliminary PMIs for Eurozone manufacturing show an improvement to 39.5 though it is still worth noting that anything below 50 represents a contraction. The ongoing US-China tensions is one point that can drag the pair back, though traders will be hoping this geopolitical situation does not cause further turmoil.

Markets Dip Slightly but Quickly Recover

Major US markets dipped slightly on the opening bell at Wall Street. This after a week of strong rallying which accompanied a steady overall improvement in market sentiment since the beginning of the week. This early dip may well be attributed to the US unemployment claim figures for the previous week. These continue to rise, and are now at a new all-time peak of more than 38 million claims since early March.

This number includes an increase of 2.4 million on the previous week, which, although sees the number reaching a new record high, is actually a significant slowing of the pace. Still more than 25 million continuing claims are on the books. The hope is that as most states begin their staged reopening, that some of these temporary layoffs can be restored and help further boost the economy.

Sterling Also Holding Strong on Improving Data

An improving UK PMI and move away from Dollar safety has also lent some support to the Pound. PMI numbers rose to a preliminary 28.9 for April, almost double that of the previous month, yet still well inside contraction territory. This points to a slowing of the negative impacts though as the UK also slowly gets back to work amid easing lockdown restrictions.

The forex market has also undoubtedly been supported by comments from the Bank of England Governor Andrew Bailey on Wednesday. He commented that the bank were not ruling out a move to negative rates in order to stimulate economic recovery from the coronavirus pandemic.

Forex Brokers Review

Forex Markets Undisturbed by US Unemployment Data

Forex Markets Undisturbed by US Unemployment Data

– #1 Broker in USA
– Canadians Welcome
– Over 80 Currencies
– Regulated by NFA, CFTC, FCA, FSA, IIROC & CIMA
– Member of the National Futures Association (NFA# 0339826)

Click Here to Visit Forex.com

Forex Markets Undisturbed by US Unemployment Data

Forex Markets Undisturbed by US Unemployment Data

– #1 Broker in UK
– Singapore Welcome
– Australia Welcome
– 12,000 + Global Markets
– Established in 1983
– Authorized & Regulated by the FCA

Click Here to Visit City Index

Spread the love

Categories
Forex News

Forex & Commodities Trading Levels to Watch on Thursday – Forex News by FX Leaders – FX Leaders

EUR/USD – Technical Levels
Support Resistance
1.0955 1.1051
1.0896 1.109
1.0799 1.1187
Key Trading Level: 1.0993

USD/JPY – Technical Levels
Support Resistance
107.5 107.99
107.23 108.21
106.75 108.7
Key Trading Level: 107.72

GBP/USD -Technical Levels
Support Resistance
1.2194 1.2344
1.2124 1.2424
1.1974 1.2574
Key Trading Level: 1.2274

GOLD -Technical Levels
Support Resistance
1697.65 1719.27
1684.96 1728.2
1663.34 1749.82
Key Trading Level: 1706.58

WTI CRUDE OIL – Technical Levels
Support Resistance
30.88 33.55
29.96 35.31
27.29 37.98
Key Trading Level: 32.64

Categories
Forex News

Forex Today: sentiment tosses and turns – FXStreet

What you need to know on Thursday, May 28th:

 Speculative interest remained sensible to sentiment-related headlines, trading in consequence. The main risk-negative factor was renewed tensions between the US and China, as the US government announced its studying sanctions on Chinese authorities and business over the recent developments in Hong Kong. US  Secretary Pompeo officially declared Hong Kong “no longer autonomous,” after China’s intervention.

The EUR/USD pair rallied after thee EU Commission that proposed a 750 billion euro recovery fund. Also, the next  EU budget proposed by the organism will be worth €1.1 trillion and will include the coronavirus recovery fund, according to sources familiar with the matter. The pair peaked at 1.1030 and settled around 1.1000.

Brexit-related headlines weighed on the Pound. According to PM Johnson’s spokesman, the UK has no will to extend the transition period beyond December 31. The EU and the UK will resume talks next week. GBP/USD finished the day around 1.2250.

Commodity-linked currencies were the worst performers, despite the positive tone of equities as gold and oil both fell. The bright metal, however, recovered ahead of the close and settled at around 1,712. Crude oil prices were sharply lower, losing around 5% after Exxon Mobil CEO Darren Woods mentioned Exxon expects a 10% decline in demand in 2020 due to lost economic activity. Focus now shifts to US stockpiles data.

 Cryptocurrencies Market News: Crypto sentiment improves despite Goldman Sachs slamming Bitcoin