iFOREX Daily Analysis : November 08,2017
iFOREX | Nov 08, 2017 03:49AM ET
The US Dollar was trading higher against a basket of major currencies on Tuesday with the US Dollar Index (USDX) closing 0.21% higher due to optimism that the tax proposal of the Trump administration is on track, while concerns about the corruption probe in Saudi-Arabia, which is heavily Dollar dependent were seen to be waning to some level.
Heavy spending on public education in South African has seen the Rand lose close to 1% against the Dollar on Tuesday. The Turkish lost again the previous day’s gains against the Dollar and was trading 1.5% lower, closing in again on the all-time low from January.
Gold was down amid a strong Dollar and signs that the US tax reform is on track. Oil closed lower after American Petroleum Institute (API) data indicated less reduction in crude oil stockpiles than previously expected.
US indices closed mostly in the red with banks showing a weak performance after the US Treasury yield curve flattened, reducing returns on longer term bonds. The US Banks ETF was down by 2.48%. The earnings (loss) figures published by SNAP Inc. were below investors’ expectation pulling the stock down by a double-digit percentage amount in after hours trading.
The Bitcoin remained around the level of $7,000, falling from its high two days ago of over $7,600.
Societe Generale (PA:SOGN) CEO Frederic Oudea joined ranks with other bank executives started by Jamie Dimon (J P Morgan), claiming that the Bitcoin would have no future due to its anonymity. Sheba Jafari, an analyst from Goldman Sachs (NYSE:GS) predicted that the Bitcoin would surge to a new high of $7,900 despite the recent fall.
On Wednesday France publishes Merchandise Trade statistics, while in the US the Mortgage Bankers' Association (MBA) is set to publish its data relevant to the financial and real estate market. The Energy Information Administration (EIA) will publish its oil and oil derivate stockpile statistics. Canada is due to publish its Housing Starts data.
EUR/USD
The US Dollar was stronger against the Euro as German Industrial Production (IP) was below expectations with a value of -1.6% (expectation -0.6%) in the monthly statistics and 3.5% in the annual statistic (previously 4.5%). The Dollar received support by investors’ optimistic expectations regarding the proposed Republican US tax reform and a possible Fed rate hike this year.
On Wednesday France publishes Merchandise Trade statistics, while in the US the Mortgage Bankers' Association (MBA) is set to publish its data relevant to the financial and real estate market.
Get The News You Want
Pivot: 1.16
Support: 1.157 1.1555 1.153
Resistance: 1.16 1.162 1.164
Scenario 1: short positions below 1.1600 with targets at 1.1570 & 1.1555 in extension.
Scenario 2: above 1.1600 look for further upside with 1.1620 & 1.1640 as targets.
Comment: the RSI is mixed and calls for caution. The pair is trading in a bearish channel.
Gold
Gold slightly retreated amid a stronger US Dollar, making purchases of the precious metal more expensive in other currencies. Markets seemingly calmed down after tensions in Saudi-Arabia due to the ongoing anti-corruption investigation that saw some of the country’s influential royal family members and business tycoons arrested. Positive US Labor Department’s data and good progress on the tax reform eased pressure and reduced demand for the safe haven.
As Gold is mainly traded in US Dollar it could be sensible to US Jobless numbers due on Thursday as well as the Treasury Budget level publication on Friday.
Pivot: 1270.5
Support: 1270.5 1265 1260
Resistance: 1280.5 1284 1290.5
Scenario 1: long positions above 1270.50 with targets at 1280.50 & 1284.00 in extension.
Scenario 2: below 1270.50 look for further downside with 1265.00 & 1260.00 as targets.
Comment: the RSI is mixed to bullish.
WTI Oil
Oil ended the trading session lower on Tuesday as American Petroleum Institute (API) data indicated a reduction of US crude oil stocks by 1.562 million barrels, which was a reduction below previous estimates. Furthermore gasoline stockpiles increased by 0.52 million barrels which pushed its price down from the two-year high reached on Monday. The World Oil Outlook by OPEC changed the outlook for the North American shale oil output expectations to 5.1 million barrels per day from previously 4.1 million barrels per days due to rising oil prices.
On Wednesday the Energy Information Administration (EIA) will publish its oil and oil derivate stockpile statistics.
Pivot: 56.75
Support: 56.75 56.1 55.65
Resistance: 57.7 58 58.4
Scenario 1: long positions above 56.75 with targets at 57.70 & 58.00 in extension.
Scenario 2: below 56.75 look for further downside with 56.10 & 55.65 as targets.
Comment: the RSI is mixed to bullish.
US 500
US equity indices closed lower on Tuesday with the exception of the NASDAQ (US Tech 100). Banks were under pressure as the Treasury yield curve flattened as longer term Treasury bonds yielded lower. This was also seen in a weak performance of the US Banks ETF (-2.48%).
The travel distribution company Priceline traded 13.49% lower as earnings missed expectations, while SNAP Inc. (owner of Snapchat) traded also lower by a double-digit amount in after hours trading as reported losses exceeded expectations.
On Wednesday the US the Mortgage Bankers' Association (MBA) is set to publish its data relevant to the financial and real estate market. With the earnings season almost over one of the major remaining tech companies due to publish is the graphic processor developer NVidia, which is due to publish numbers on Thursday after market close.
Pivot: 2589
Support: 2580 2574 2567
Resistance: 2589 2593 2600
Scenario 1: short positions below 2589.00 with targets at 2580.00 & 2574.00 in extension.
Scenario 2: above 2589.00 look for further upside with 2593.50 & 2600.00 as targets.
Comment: the RSI broke below 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.