iFOREX Daily Analysis : June 22,2018
iFOREX | Jun 22, 2018 07:36AM ET
The US Dollar traded weaker against other major currencies, especially the Pound (GBP) following the BoE meeting, with the US Dollar Index (USDX) closing 0.25% lower. The Canadian Dollar (CAD) traded near a one year low against the USD ahead of Retail Sales, and Consumer Price Index (CPI) data due in Canada on Friday.
Gold reached a new year-to-date low on Thursday but was able to see moderate gains early on Friday. Oil pushed higher in early trading on Friday as a consensus from OPEC to increase production quotas at their meeting this weekend is far from certain with Iran, Venezuela and others opposing higher or significantly higher production levels.
US equities traded lower on Thursday with data from the Philadelphia Fed General Business Conditions survey and the FHFA House Price Index failing to show the expected results.
Cryptocurrencies traded lower with significant losses in Bitcoin Cash, Litecoin and other cryptocurrencies. Litecoin’s fall towards the $90 level marks its lowest point for this year.
On Friday in Germany and the EU PMI Service and Manufacturing data is set to be released. France is due to release its most recent GDP numbers.
EUR/USD
The EUR/USD traded moderately higher on Thursday, with some economic data in the US missing expectations. While New Jobless Claims remained at 218 thousand (expected 220 thousand), the Philadelphia Fed General Business Conditions level slipped to 19.9 (expected 28.0 / previous 34.4) and the FHFA House Price Index was at only +0.1% m/m (expected +0.5%).
On Friday in France data on the Gross Domestic Product (GDP) is set to be released. The European Union and Germany will release their respective PMI levels for Services and Manufacturing. Next week on Monday in Germany the results of the influential IFO Survey are set to be released.
Pivot:1.1575Support:1.15751.15551.153Resistance:1.16451.16751.171Scenario 1:long positions above 1.1575 with targets at 1.1645 & 1.1675 in extension.Scenario 2:below 1.1575 look for further downside with 1.1555 & 1.1530 as targets.Comment:the RSI advocates for further upside.
GBP/USD
The Pound recovered from the recent 7-months low against the Dollar as the Bank of England (BoE) voted to keep the key interest rate unchanged at 0.5 percent with a 6-3 vote, compared to a 7-2 vote at the last meeting. The central bankers confirmed their view that the weak economic growth in Q1 of 2018 was only temporarily and some analysts see it now as more likely that the BoE might even raise interest rates in the next summer months.
Next week on Tuesday the CBI Distributive Trades statistic will be released in the UK and on Friday next week GDP and M4 Monetary Supply data is due for publication.
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Pivot:1.323Support:1.3231.3211.318Resistance:1.331.33351.337Scenario 1:long positions above 1.3230 with targets at 1.3300 & 1.3335 in extension.Scenario 2:below 1.3230 look for further downside with 1.3210 & 1.3180 as targets.Comment:the RSI is bullish and calls for further upside.
WTI Oil
On Thursday the different kinds of oil – WTI and Brent – traded in different directions. While the WTI oil closed moderately higher, Brent oil lost more than 1 percent that day. The international benchmark Brent was initially trading higher due to a likely consensus at the OPEC meeting to raise production quotas. However this appears now less likely with the bloc split between demands by Saudi-Arabia and Russia to raise quotas, while other members like Iran and Venezuela are seen in the opposition to this move.
WTI as the US American oil benchmark could have traded higher from news that a capacity bottleneck of the Permian pipeline could make further increases in production hard to attain, as there are also reports that an increasing amount of unfinished oil wells are abandoned in that region.
On Friday the US Baker Hughes Oil Rig Count is going to be released and will show the amount of operating oil rigs in the US. The statistic was never negative for the previous 11 consecutive reporting weeks.
Pivot:65.8Support:65.864.964.4Resistance:66.9567.3568Scenario 1:long positions above 65.80 with targets at 66.95 & 67.35 in extension.Scenario 2:below 65.80 look for further downside with 64.90 & 64.40 as targets.Comment:the RSI advocates for further advance. Prices are trading above both 20-period and 50-period moving averages.
US 30
US equity indices had another day of losses on Thursday over mixed economic data and continued fears of the implications of a possible trade standoff. The Dow Jones Industrial Average (US 30) is on track for the second consecutive week with a loss.
Especially chip makers’ (US Semiconductors ETF -1.23%) and energy (US Energy ETF (NYSE:XLE) -1.95%) stocks traded lower, while real estate sector stocks (US Real Estate ETF +0.45%) showed moderate gains.
AMD (-5.45%) further retreated from the recent almost 10-year high over concerns that the revenue from cryptocurrency miners using AMD’s GPUs could decline, given that crypto miners’ demand makes up 10 percent of the current company revenue.
Starbucks (NASDAQ:SBUX) (-3.12%) traded lower over concerns of slowing growth and performance, with the coffee chain announcing to close 150 of its shops in the United States.
Next week on Monday in the US data from the Chicago Fed National Activity Index (CFNAI) level statistic and New Home Sales is set to be released.
Pivot: 24560 Support: 24400 24345 24260 Resistance: 24560 24630 24715 Scenario 1: short positions below 24560.00 with targets at 24400.00 & 24345.00 in extension. Scenario 2: above 24560.00 look for further upside with 24630.00 & 24715.00 as targets. Comment: technically the RSI is below its neutrality area at 50.
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