iFOREX Daily Analysis : March 19,2018
iFOREX | Mar 19, 2018 03:49AM ET
The US Dollar traded stronger against other major currencies with the US Dollar Index (USDX) rising 0.12%. The Australian Dollar (AUD) declined by over 1% against the USD, hitting a new low for 2018. This was attributed among other things to lower commodity prices and uncertainty in the global trade, following US President Trump’s announcement to introduce tariffs.
Gold was under pressure by a stronger US Dollar and rising US Treasury Yields. Despite a higher number of operating oil rigs in the US being reported, crude oil prices rose on Friday following previous reports by the IEA about strong demand expectations for 2018.
Equities traded mixed with utilities and energy values trading higher, while technology values showed a gradual decline.
On Sunday Bitcoin fell below the $7,500 level, but managed to recover later to above $8,000. Other cryptocurrencies like Litecoin and Ethereum also started to recover during Sunday evening but were still significantly below Friday’s levels. In a possible precedent ruling the New York state Public Service Commission announced, that power companies would be allowed to charge cryptocurrency miners higher electricity rates.
On Monday Italy publishes Industrial Production (IP) and Merchandise Trade level statistics, while the EU will release Merchandise Trade data. Australia’s central bank (RBA) is set to publish the minutes from its last policy meeting on Tuesday. On Wednesday the Federal Reserve will make monetary policy and rate decision announcements and on Thursday the Reserve Bank of New Zealand is due to announce its latest monetary policy decision.
EUR/USD
The EUR/USD continued its decline into Friday’s trading supported yet again by strong US fundamentals. While the housing starts at 1.236M slightly lagged behind expectations (1.285M expected), Industrial Production m/m was up by 1.1% (expected +0.4%) and the Capacity Utilization level was with 78.1% also above expectations (expected 77.7%). Meanwhile in Europe inflation data from Italy (CPI +0.5% y/y vs. +0.6% expected) and the European Union (HICP +1.1% y/y vs. +1.2% expected) lagged behind expectations. The ECB has a target of 2% inflation and a low inflation rate could slow down the process of raising interest rates.
On Monday Italy publishes Industrial Production (IP) and Merchandise Trade level statistics, while the EU will release Merchandise Trade data.
Pivot:1.233Support:1.22551.22251.2185Resistance:1.2331.23451.2365Scenario 1:short positions below 1.2330 with targets at 1.2255 & 1.2225 in extension.Scenario 2:above 1.2330 look for further upside with 1.2345 & 1.2365 as targets.Comment:the RSI is mixed to bearish.
Get The News You Want
Gold
Gold closed lower on Friday, making it the fourth consecutive week with falling gold prices. Gold was under pressure by a stronger Dollar as well as rising US Treasury Yields. A stronger Dollar makes gold more expensive in non-Dollar economies, while higher sovereign yields make investment in non-yield bearing gold less attractive. Positive fundamental data in the US could also have had influence on the movement of the gold price.
This Monday finance ministers and central bankers are due to meet as part of a G20 forum. Later this week on Wednesday, the US Federal Reserve is due to announce its latest monetary policy and rate decision.
Pivot:1318Support:130913051302.5Resistance:13181321.51324Scenario 1:short positions below 1318.00 with targets at 1309.00 & 1305.00 in extension.Scenario 2:above 1318.00 look for further upside with 1321.50 & 1324.00 as targets.Comment:the RSI is mixed to bearish.
WTI Oil
Oil traded sharply higher in Friday’s trading, helping it close overall positive on a weekly basis. The rise in oil prices comes despite the Baker Hughes Oil Rig Count for the US rising by 4 to 800 operating oil rigs. The earlier statement from the International Energy Agency about strong demand for oil pushing the markets and concerns about Venezuelan output declining possibly pushed prices higher. Some analysts suggested that the short covering before the expiration of April futures could also have had some market impact.
On Tuesday the American Petroleum Institute (API) will release oil stockpile figures, followed by the Energy Information Administration (EIA) on Wednesday.
Pivot:61.4Support:63.0562.8562.55Resistance:61.460.960.3Scenario 1:long positions above 61.40 with targets at 62.75 & 63.30 in extension.Scenario 2:below 61.40 look for further downside with 60.90 & 60.30 as targets.Comment:the RSI is supported by a bullish trend line.
US 500
US futures equity indices closed mixed with gains in the Dow (US 30) and Russell 2000 (US 2000) trading higher, while futures on the S&P 500 (US 500) and NASDAQ (US Tech 100) settled lower. Still the positive sentiment was supported by strong manifesting data and the Consumer Sentiment at a 14 year high. Utilities (US Utilities ETF +1.00%) and energy (US Energy ETF (NYSE:XLE) +0.96%) values showed the strongest performance, while technology values (US Technology ETF -0.02%) remained close to unchanged.
Micron (+3.08%) closed higher ahead of quarterly results to be published on Thursday (22/3). Also this week Oracle (NYSE:ORCL) (Monday) and Nike (NYSE:NKE) (Thursday) among others are due to release their earnings results.
On Friday the US will publish New Home Sales and Durable Goods New Orders.
Pivot: 2745 Support: 2745 2735 2723 Resistance: 2771 2783 2795 Scenario 1: long positions above 2745.00 with targets at 2771.00 & 2783.00 in extension. Scenario 2: below 2745.00 look for further downside with 2735.00 & 2723.00 as targets. Comment: the RSI is supported by a rising trend line.
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.