iFOREX Daily Analysis : August 16 ,2017
iFOREX | Aug 16, 2017 05:42AM ET
Asian shares as well as the U.S. Dollar gained ground on Tuesday after North Korea signaled a delay in plans to fire a missile near Guam, reducing tensions and prompting investors to move back to riskier assets.
The U.S. Dollar extended its gains against other major currencies on Tuesday, helped by the release of positive U.S. retail sales data and positive market sentiment due to easing tensions between the U.S. and North Korea.
Another report showed that the Empire State manufacturing index rose to 25.2 in August from 9.8 in July, exceeding expectations by far. It was at its highest level since September 2014.
Bitcoin among other cryptocurrencies sharply fell on Tuesday’s trading while still managing to stay clearly above its price from Friday last week. As more and more investors – even institutional investors – gain interest in cryptocurrencies it remains to be seen whether regulatory pressure could be a barrier for further growth.
On Wednesday investors will be looking at the U.S. housing data as well as the release of the July FED meeting minutes released that day. UK unemployment statistics as well as the EU GDP figures for Q2 also released that day could influence European shares and currencies. On Thursday morning Japan will release its trade statistics which could make that trading session particularly interesting to watch.
EUR/USD
The dollar gained against major currencies including the Euro on Tuesday, aided by the release of positive U.S. retail sales data and as market sentiment due to easing frictions between the U.S. and North Korean leadership.
In the euro zone in Germany the gross domestic product rose only 0.6% in the second quarter of 2017, disappointing investor’s expectations for an increase of 0.7%. However the German economy seems to be still on track for a 2% growth this year. This could however not halt the fall of the EUR/USD (at least temporarily) below 1.17 thanks to overwhelmingly positive economic data from the U.S.
On Wednesday investors will be looking anxiously at the published U.S. Fed minutes and U.S. housing statistics.
Pivot: 1.177
Support: 1.1685 1.165 1.161
Resistance: 1.177 1.1795 1.181
Scenario 1: short positions below 1.1770 with targets at 1.1685 & 1.1650 in extension.
Scenario 2: above 1.1770 look for further upside with 1.1795 & 1.1810 as targets.
Comment: the RSI shows downside momentum.
Get The News You Want
Gold
The gold price further receded in Tuesday’s trading, as strong U.S. retail sales data sent the Dollar widely higher.
The demand for the safe-haven precious metal continued to wane after on Tuesday North Korea declared that they would delay a decision on a plan to fire missiles at the U.S. pacific island Guam while it would observe U.S. actions a little longer.
On Wednesday the minutes of the U.S. Federal Reserve policy meeting from July will be released. Investors hope to get further insight into future monetary policy decisions from the FED which could affect different kinds of assets.
Pivot: 1276
Support: 1266 1261 1256
Resistance: 1276 1279.5 1285.5
Scenario 1: short positions below 1276.00 with targets at 1266.00 & 1261.00 in extension.
Scenario 2: above 1276.00 look for further upside with 1279.50 & 1285.50 as targets.
Comment: the RSI is capped by a declining trend line.
WTI Oil
Oil prices remained at three-week lows in Tuesday’s trading session, due to the strengthening of the U.S. dollar after the release of positive economic data from the U.S. and as concerns over a global supply surplus continued. U.S. retail sales figures rose better than expected in July, improving the outlook for economic growth in the next quarter.
Also the concerns over reducing demand from China, which is the second-largest oil consumer in the world put the prices under pressure.
The markets will be watching the release of EIA (Energy Information Administration) data tomorrow, which will show possible changes in U.S. oil, gas and petroleum inventories.
Pivot: 47.8
Support: 46.65 46.25 45.88
Resistance: 47.8 48.15 48.45
Scenario 1: short positions below 47.80 with targets at 46.65 & 46.25 in extension.
Scenario 2: above 47.80 look for further upside with 48.15 & 48.45 as targets.
Comment: the RSI is capped by a bearish trend line.
US 500
U.S. equities opened mostly unchanged on Tuesday after it was understood that North Korea would be delaying ideas about firing missiles towards Guam, suggesting somewhat ebbing tensions between the United States and North Korea.
Economic data showed retail sales in the U.S. at their biggest increase in seven months for July as consumers increased purchases of automobiles and their discretionary spending.
Warren Buffet's Berkshire Hathaway (NYSE:BRKa) announced today that they are selling all General Electric (NYSE:GE) 10.6 million shares in their portfolio which put GE under pressure.
Traders will be watching the FED July’s meeting minutes release as well U.S. housing data which will both be released on Wednesday.
Pivot: 2455
Support: 2455 2449 2444
Resistance: 2474 2480 2488
Scenario 1: long positions above 2455.00 with targets at 2474.00 & 2480.00 in extension.
Scenario 2: below 2455.00 look for further downside with 2449.50 & 2444.00 as targets.
Comment: the RSI is mixed to bullish.
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.