InvestMacro

By George Prior

The UK Supreme Court’s ruling that Boris Johnson’s suspension of parliament was unlawful will not boost optimism in the pound and UK financial assets, warns the CEO of one of the world’s largest independent financial organisations.

The comments from Nigel Green, the CEO of deVere Group, follow the unanimous judgement by the highest court in the land on Tuesday that the prorogation of parliament was “unlawful” because it had the effect of frustrating democracy.

He observes: “This is a massive blow to UK Prime Minister Boris Johnson and his approach to Brexit.  It would suggest that the possibility of a hard Brexit – and all its associated perceived threats – has further reduced.

“However, the ruling will not, in fact, deliver a major boost of optimism to the pound and UK financial assets because the Brexit timetable remains in place.

“The Brexit-fuelled political uncertainty deepens, and this will temper any significant upside. Sterling and UK financial assets remain flat.”

Mr Green continues: “MPs are on their way back to the House of Commons and they have already rejected a no-deal exit. Therefore, Boris Johnson needs to get on with securing a deal with the EU that will get through parliament.

“He needs to play strongly the hand with the EU that it’s in their economic best interests to reopen negotiations. After all, the last thing they need is a no-deal and be unable to trade effectively as they do now with the UK, especially as the wider EU and global economies are slowing.”

The deVere CEO concludes: “As the saga and uncertainty continues, it can be expected that both UK domestic and international investors in UK assets are increasingly likely to move assets away from the UK to grow and safeguard their wealth.”

Earlier this month, a deVere Group survey found that there’s been a 35% increase in investors seeking to reduce their exposure to UK assets (barring UK property) since Mr Johnson became PM in July.

About:

deVere Group is one of the world’s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients.  It has a network of more than 70 offices across the world, over 80,000 clients and $12bn under advisement.

By Orbex

US Treasury Secretary Speaks

The latest headlines surrounding the ongoing US-China trade negotiations have done little to encourage the markets this week.

Speaking with US reporters on Monday evening, US Treasury Secretary Steve Mnuchin said that talks between negotiators are due to start again in Washington in two weeks time, adding:

“The president’s been very clear if we can get the right deal, he wants the deal…If we can’t get the right deal, he’s happy with the tariffs.”

Mnuchin spoke further in support of the President’s strategy saying:

“As you know, the president not only likes tariffs, but he uses them strategically. And he’s right…If it weren’t for the tariffs, nobody would be at the table negotiating.”

Confusion At The Top

In a slightly more comedic twist, there appeared to be some confusion between the president and one of his highest level officials over the recent canceling of Chinese visits to US farms.

Speaking at the UN General Assembly, Mnuchin said that Trump’s team had requested that China cancel the planned visits to US farming regions.

However, Trump appeared unaware, asking Mnuchin:

“Why was that our request, just out of curiosity?”

Mnuchin reassured the president over the request.

Trump replied saying “yeah but I want them to buy our farm products”.

However, again, Mnuchin reassured the president, saying:

“There was no confusion. We want them to buy our agriculture. They’ve committed to buy agriculture”.

US-Japan Trade Deal Under Threat

It was not just the latest news regarding US-Chinese negotiations that has caused concern this week.

Following Trump’s recent announcement that he agreed on a trade deal with Japan, the latest reports have thrown the deal into doubt.

The US president and Japanese Prime Minister Shinzo Abe were aiming to sign a deal at the UN General Assembly this week. However, talks have reportedly come into difficulty. Japan is seeking assurances that the US will not press ahead with planned “national security” tariffs on Japanese autos and auto parts.

The trade deal is designed to increase US access to Japan for US agricultural products along with bilateral reductions in industrial tariffs. And it’s not supposed to see any adjustments to current tariffs and trade rules regarding the auto sector.

Auto sales from Japan currently account for the biggest section of $67.6 billion.

Autos Tariffs In Focus

Trump has yet to follow through on threats earlier in the year to impose import tariffs of 25% on Japanese and European car parts. However. he has not said that he will cancel the tariffs. Japan is reportedly looking for a sunset clause in the trade agreement which removes any trade benefits for the US should the tariffs be applied.

Commenting on the progress of the trade talks between the US and Japan, Japanese Foreign Ministry spokesman Masato Ohtaka said:

“Frankly speaking, we still have some time and all my colleagues in the government are making their best efforts to actually meet this target,”

Technical Perspective

USDJPY continues to threaten a proper breakout higher. Following an initial move above the bear channel top last week, price has since reversed a little but is holding above the 107.25 level for now. While above here, focus is on further upside with 108.83 the next key resistance level to watch.

By Orbex

By Orbex

Traders Waiting on Key Data

The US dollar has had a muted session so far this week with price action remaining dulled as the market awaits the next key US data.

The US GDP print will be the key release of the week and while the latest FOMC meeting has poured cold water on expectations of another 2019 Fed rate cut, any sharp weakness could see these expectations rising again.

USD index trades 98.21 last.

Data Disappointment Keeps EUR Weak

EURUSD remains under pressure today as the latest data from Germany and the eurozone has seen selling kicking in.

German and eurozone PMIs released yesterday highlighted weakness across the board. This is keeping the pressure on the ECB which recently announced fresh easing measures.

EURUSD trades 1.0097 last, still below the 1.1025 level for now.

Supreme Court Rules Against UK PM

GBPUSD has been a little higher today with ongoing optimism about the reduced risk of a no-deal Brexit keeping demand intact.

Price is sitting at 1.2446 as of writing, just above the 1.2382 level. However, it is yet to challenge the bear channel top.

The UK Supreme Court today ruled that UK PM Johnson acted illegally by proroguing parliament and says parliament must reconvene.

Risk Markets Still Bid

Risk assets have been a little firmer over the European morning on Tuesday. However, we are yet to see any proper directional moves with price action remaining fairly dull.

SPX500 trades 30003.78 as of writing. News of a potential obstacle in the US-Japan trade deal seems to have caused some concern. However, remaining optimism around the US-China negotiations is helping offset that risk.

JPY & Gold Sell-Off

Safe havens have both been a little lower today with JPY and gold weaker against USD, highlighting a generally positive backdrop.

USD strength following the FOMC last week has hindered upside in both gold and JPY.

XAUUSD trades 1521.25 last, sitting just below the key 1522.75 level. USDJPY trades 107.72 last with price still sitting off last week’s highs for now.

Crude Down Again

Oil prices remain under pressure today. News of further weakness in German and eurozone manufacturing has created fresh concern around the demand outlook for oil.

OPEC recently cut its global demand forecasts for this year and next, citing the ongoing trade war as the main driver of weakness.

Crude trades 57.93 last as traders await this week’s API inventories report later today ahead of tomorrow’s key EIA reading.

CAD Still Capped

USDCAD has been a little higher today, with weakness in crude prices weighing on CAD.

USDCAD trades 1.3253 last with price having been rejected yet again at the 1.33 level following several attempts to break the level last week.

Aussie Soars

AUDUSD has been firmly higher today with price trading .68 last.

Optimism around a potential US-China trade deal at the next round of negotiations next month is keeping price well supported.

While price remains above the .6758 support level focus is on a further push higher with the bearish trend line from year to date highs the next level to watch.

By Orbex

By Orbex

Consumer Confidence continued to recover in August at a faster pace than economists had anticipated. 

It closed the gap from June’s decline at 121.5 and improved the positive average.

Expectations are for the CB’s monthly index to edge slightly higher in September. 

However, the markets expect the numbers to uptick only 20 basis points above August’s print of 135.1, at 135.3.

Consumers Remain Confident

In 2019 so far, consumer attitude showed a greater appetite for spending than analysts had expected.

With Q3 nearing its end, September’s release will mark whether this should continue to be the case into the last quarter of a rather problematic year or not.

Considering a 10 basis point divergence when comparing releases that missed versus releases that beat estimations, this month will end up marking Q3 consumer confidence either as a worse or better than expected quarter.

Hence, the quarter factor makes this event special. And this could have a significant effect on the liquidity injected into the markets during the release.

Rise in Wages Could Support Sentiment

US average hourly earnings rose 0.4% month-on-month in August. This is despite the labor market sliding 28K below expectations.

Hourly wages increased by 11 cents, which is higher than the 8 cents expected. It’s also the largest increase since February. In 2019 so far, wages remained somewhat elevated, supporting better GDP figures.

The year-on-year figures trade right at the long-term average of 3.2%. The bad news is that wages grow way faster than inflation does.

Inflation is stuck below the Fed’s target of 2%, at 1.7%. This comes as energy deflation tumbled 4.4% in August. With the Fed lowering rates, inflation should start picking again as consumers will have more to spend, and this should at least support CB in the short to medium term.

ISM Could Show Positive Economic Direction

The ISM Manufacturing index fell to contractionary levels in September. Regardless of a forecast of 51.1, data from monthly replies indicated that the PMI responded badly to the effects of poor employment. The employment component fell 4.3% compared to July.

The ISM report reflected a decline in business confidence and considerable cracks from a large contraction in new export orders. Not only is this a reason to alarm the labor market, but it also triggers an underlying fear of a potential recession.

With trade, rather than the trade wars remaining as the most significant issue, the ISM forecasts hint to stronger demand for new orders. These expectations could reflect a notable increase in business confidence, hence add on to optimistic sentiment.

The question now is: will US consumers take sentiment from the Fed’s cut or is it too early to inherent optimism amid a lingering trade war?

By Orbex

By IFCMarkets

Coffee Exporters May Reduce Shipping

Brazil’s drought could have a negative effect on coffee yield. Will the Robusta quotations grow?

The Indian Coffee Exporters Association does not rule out that Robusta coffee makers may slightly reduce coffee shipments from India in anticipation of more accurate crop estimates and a possible increase in quotations. Last week, the Honduran Coffee Institute published a forecast for a decline in coffee exports from Honduras in the 2019/20 season by 4.6% to 6.6 million bags of 60 kg. At the same time, the area under coffee in Honduras may be reduced by 5.2%.

On the daily timeframe Robusta: D1 adjusts upward from the bottom line of the wide neutral range. Various technical analysis indicators have generated signals to increase. Further growth of quotations is possible in case of decrease in world production and with an increase in demand.

• The Parabolic indicator gives a signal to increase.
• The Bolinger bands narrowed, indicating low volatility.
• The RSI indicator is above the mark of 50. It has formed a divergence to increase.
• The MACD indicator gives u bullish signal.

The bullish momentum may develop if Robusta exceeds the last two upper fractals and the upper Bollinger line: 1355. This level can be used as an entry point. The initial stop lose may be placed below the last lower fractal, the minimum since March 2010, the lower Bollinger line and the Parabolic signal: 1260. After opening a pending order, stop shall be moved following Bollinger and Parabolic signals to the next fractal minimum. Thus, we are changing the potential profit/loss to the breakeven point. More risk-averse traders may switch to the 4-hour chart after the trade and place a stop loss moving it in the direction of the trade. If the price meets the stop level (1260) without reaching the order (1355), we recommend to cancel the order: the market sustains internal changes that were not taken into account.

Technical Analysis Summary

Market Analysis provided by IFCMarkets

Article By RoboForex.com

AUDUSD, “Australian Dollar vs US Dollar”

AUDUSD is trading at 0.6779; the instrument is moving below Ichimoku Cloud, thus indicating a descending tendency. The markets could indicate that the price may test Tenkan-Sen and Kijun-Sen at 0.6805 and then resume moving downwards to reach 0.6665. Another signal to confirm further descending movement is the price’s rebounding from the resistance level. However, the scenario that implies further decline may be canceled if the price breaks the cloud’s upside border and fixes above 0.6845. In this case, the pair may continue growing towards 0.6925.

NZDUSD, “New Zealand Dollar vs US Dollar”

NZDUSD is trading at 0.6300; the instrument is moving below Ichimoku Cloud, thus indicating a descending tendency. The markets could indicate that the price may test Tenkan-Sen and Kijun-Sen the cloud’s upside border at 0.6310 and then resume moving downwards to reach 0.6185. Another signal to confirm further descending movement is the price’s rebounding from the descending channel’s upside border. However, the scenario that implies further decline may be canceled if the price breaks the cloud’s upside border and fixes above 0.6375. In this case, the pair may continue growing towards 0.6465.

USDCAD, “US Dollar vs Canadian Dollar”

USDCAD is trading at 1.3256; the instrument is moving below Ichimoku Cloud, thus indicating a descending tendency. The markets could indicate that the price may test the cloud’s upside border at 1.3275 and then resume moving downwards to reach 1.3120. Another signal to confirm further descending movement is the price’s rebounding from the resistance level. However, the scenario that implies further decline may be canceled if the price breaks the cloud’s upside border and fixes above 1.3310. In this case, the pair may continue growing towards 1.3405. After breaking the ascending channel’s downside border and fixing below 1.3200, the price may continue moving downwards.

Article By RoboForex.com

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

By Orbex

ECB President Mario Draghi, speaking to EU lawmakers reiterated that the central bank was ready to cut rates even more. Draghi warned that the downturn in the manufacturing sector could spill over to other parts of the economy. Draghi’s comments come after the ECB lowered the deposit rate at its recent monetary policy meeting. The central bank also restarted its QE program in a bid to revive the economy.

Bundesbank Downplays Recession Fears

The Bundesbank said on Monday that the German economy entered into a recession in the three months through September. However, the central bank dismissed it by saying that there was no cause for concern. The comments came after German flash manufacturing PMI hit the lowest level in over a decade. Markit’s flash PMI for Germany fell to 41.4, down from 43.5 in August. Meanwhile, the GDP fell 0.1% in the three months to June 2019.

EURUSD Gaps Lower, but Supported by Trend Line

The currency pair gapped lower on Monday’s open, but price managed to fill the gap intraday. Currently, EURUSD remains supported by the long-term trend line. But there is scope for the currency to break down even lower. The support area at 1.0950 and 1.09260 will come into the picture once again. For now, there isn’t much of a change in EURUSD’s technical chart.

Boris Johnson Pushes for Final Bid on Brexit

The British Prime Minister is making a bid for the Brexit deal. Boris Johnson is in the US on the sidelines of the UN general assembly. Johnson will be speaking a number of his counterparts including Germany and the EU Council President Donald Tusk. Meanwhile back home, Jeremy Corbyn’s Labor party will be taking a vote on whether to back the idea of the UK staying in the EU.

GBPUSD to Maintain Bearish Momentum

The GBPUSD currency pair continues to extend declines. This comes after price action broke out to the downside from the ascending wedge pattern. The near-term support area of 1.2370. Any upside gains will be capped near the resistance area of 1.2511.

Gold Advances Amid Modest Risk Aversion

The precious metal advanced for the second consecutive day. This was followed from Friday’s bullish price action. Market sentiment remains cautious amid the U.S. and China trade talks not making much progress. Concerns about the global economy and Brexit remain the key headwinds in the near term.

XAUUSD Tests Three-Week High

The currency pair broke out from the sideways range and continued to maintain the upside bias. As a result, the precious metal rose to a three-week high. However, XAUUSD retreated from the intraday highs. Price action is likely to test the upside breakout level of 1508.00 to establish support.

By Orbex

Article By RoboForex.com

XAUUSD, “Gold vs US Dollar”

As we can see in the H4 chart, the ascending tendency continues. XAUUSD has formed Shooting Star reversal pattern close to the horizontal resistance level. Right now, the pair is trying to reverse. If the pair rebounds, it may move towards 1490.00. At the same time, we shouldn’t exclude a possibility that the instrument may continue growing to reach 1545.00 test the ascending channel’s upside border.

NZDUSD, “New Zealand vs. US Dollar”

As we can see in the H4 chart, NZDUSD has tested the horizontal support level and formed Doji pattern while trading downwards. Right now, the pair is reversing. After that, the pair may complete the correction and resume growing to reach 0.6361. At the same time, one shouldn’t exclude an opposite scenario, according to which the instrument may continue falling towards 0.6257.

Article By RoboForex.com

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

by JustForex

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.10068
• Open: 1.09930
• % chg. over the last day: -0.11
• Day’s range: 1.09868 – 1.09975
• 52 wk range: 1.0931 – 1.1817

Yesterday, the bearish sentiment prevailed on the EUR/USD currency pair. The EUR came under pressure after the release of weak business activity report in the EU, which further strengthened investors’ concerns about the development of the recession. The trading tool has updated local lows. At the moment, EUR/USD quotes are consolidating near the round level of 1.10000. 1.09650 is a key support. The single currency has the potential to further decline. We recommend opening positions from key levels.

The Economic News Feed for 24.09.2019:

• – IFO Business Climate Index (EU) – 11:00 (GMT+3:00);
• – CB Consumer Confidence Index (US) – 17:00 (GMT+3:00);

Indicators point to the strength of sellers: the price has fixed below 50 MA and 100 MA.

The MACD histogram is in the negative zone but above the signal line, which gives a weak signal to sell EUR/USD.

The Stochastic Oscillator is in the neutral zone, the %K line crossed the %D line. There are no signals at the moment.

Trading recommendations

• Support levels: 1.09650, 1.09300
• Resistance levels: 1.10000, 1.10250, 1.10600

If the price consolidates below 1.09650, expect a further drop toward 1.09400-1.09200.

Alternatively, the quotes can grow toward 1.10250-1.10500.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.24642
• Open: 1.24328
• % chg. over the last day: -0.29
• Day’s range: 1.24240 – 1.24384
• 52 wk range: 1.1995 – 1.3385

The GBP/USD currency pair went down. The trading tool has updated local lows. Participants in financial markets began to partially fix positions on the pound after a protracted rally. Currently, GBP/USD quotes are consolidating. The key support and resistance levels are 1.24000 and 1.24550, respectively. We do not exclude further correction of the GBP/USD currency pair and recommend keeping track of up-to-date information regarding the Brexit process. Positions must be opened from key levels.

The Economic News Feed for 24.09.2019:

• – CBI Industrial Trends Orders (UK) – 13:00 (GMT+3:00);

The price fixed below 50 MA and 100 MA, which signals the strength of sellers.

The MACD histogram is in the negative zone, but above the signal line, which gives a weak signal to sell GBP/USD.

The Stochastic Oscillator is in the neutral zone, the% K line crossed the% D line. There are no signals at the moment.

Trading recommendations

• Support levels: 1.24000, 1.23650, 1.22900
• Resistance levels: 1.24550, 1.25000, 1.25550

If the price consolidates below the round level of 1.24000, expect further correction toward 1.23650-1.23500.

Alternatively, the quotes can grow toward 1.24900-1.25200.

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.32593
• Open: 1.32567
• % chg. over the last day: -0.06
• Day’s range: 1.32535 – 1.32652
• 52 wk range: 1.2727 – 1.3664

The USD/CAD currency pair continues to trade in a protracted flat. Unidirectional trends are not observed. Investors expect additional drivers. CAD is currently consolidating near the support level 1.32550. 1.32850 acts as the local resistance. The trading instrument can move downwards. We recommend paying attention to the dynamics of oil quotes. Positions must be opened from key levels.

The Economic News Feed for 24.09.2019 is calm.

Indicators do not provide accurate signals, 50 MA has crossed 100 MA.

The MACD histogram has moved into the negative zone, which indicates the development of a bearish sentiment.

The Stochastic Oscillator is in the neutral zone, the %K line is below the %D line, which also gives a signal to sell USD/CAD.

Trading recommendations

• Support levels: 1.32550, 1.32350, 1.32100
• Resistance levels: 1.32850, 1.33100

If the price consolidates below 1.32550, expect further descend toward 1.32300-1.32100.

Alternatively, the quotes can grow toward 1.33000-1.33200.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev Open: 107.713
• Open: 107.540
• % chg. over the last day: -0.12
• Day’s range: 107.476 – 107.686
• 52 wk range: 104.97 – 114.56

USD/JPY is in the bearish mood. The USD/JPY quotes have set the new local maximums. Right now the trading instrument is consolidating. The key support and resistance levels are 107.350-107.650. JPY can grow further against the USD. Keep tracking the relevant info regarding the US/China conflict and open positions from the key levels.

The Economic News Feed for 24.09.2019 is calm.

Indicators point to the strength of sellers: the price has fixed below 50 MA and 100 MA.

The MACD histogram is in the negative zone, but above the signal line, which gives a weak signal to sell USD/JPY.

The Stochastic Oscillator is in the neutral zone, the %K line crossed the %D line. There are no signals at the moment.

Trading recommendations

• Support levels: 107.350, 107.000
• Resistance levels: 107.650, 107.850, 108.100

If the price consolidates below 107.350, expect a further drop toward 107.000-106.800.

Alternatively, the quotes can grow toward 107.800-108.000.

by JustForex

By IFCMarkets

Sharp euro-zone manufacturing contraction bearish for EURUSD

Manufacturing activity in the euro-zone contracted more sharply in September than expected. Will the EURUSD decline?

The price chart on 1-hour timeframe shows EURUSD: H1 is trading sideways. The price is below the 200-period moving average MA(200) which is level. And the RSI is at 50 level and set to rise. There is no trend yet formed, traders have to decide when it would be a best time to enter the market.

Market Analysis provided by IFCMarkets