{"id":158065,"date":"2019-10-21T11:45:14","date_gmt":"2019-10-21T15:45:14","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=158065"},"modified":"2019-10-21T10:22:52","modified_gmt":"2019-10-21T14:22:52","slug":"bojo-deal-postponement-drives-markets-higher","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/10\/bojo-deal-postponement-drives-markets-higher\/","title":{"rendered":"BoJo Deal Postponement Drives Markets Higher"},"content":{"rendered":"
October 21, 2019<\/div>
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By <\/strong>Orbex<\/strong><\/a><\/p>\n

Risk appetite rose early on Monday on headline news surrounding Brexit and the US-China trade war.<\/p>\n

The focus for the rest of this day\u2019s trading session will be on two main points.<\/p>\n

The first is on Johnson\u2019s \u201cmeaningful\u201d vote request.\u00a0 And the\u00a0second is\u00a0whether a US-Sino trade deal is indeed possible next month, as Trump has claimed.<\/p>\n

Borris Will Push For a \u201cMeaningful\u201d Vote<\/strong><\/h2>\n

The British PM requested but did not sign another extension from the European Commission over the weekend.<\/p>\n

This drove the market\u2019s confidence up as MPs approved the Letwin postponement amendment. We now expect Johnson to request a \u201cmeaningful\u201d vote to get Brexit done by the 31st as the expectation of getting legislation through parliament rises.<\/p>

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In any case, it seems that both outcomes\u00a0increase the risk-on mood.<\/strong>\u00a0The pound is up 100 pips at the time of writing, reaching a May high on the back of increased risk sentiment.<\/p>\n

High Yielding Currencies Appreciate on Latest Headlines<\/strong><\/h2>\n

Aussie, kiwi, loonie and, to a lesser\u00a0degree, euro have been upbeat amid optimistic expectations that things around Brexit are getting softer.<\/p>\n

China\u2019s disappointing GDP figures are indeed worrisome and should be adding pressures on at least Aussie and Kiwi. However, trade war hopes filtered out bearish sentiment after Trump commented that he anticipates a trade deal by the middle of next month.<\/p>\n

AUDUSD and NZDUSD remain bid near 69c and 64c, respectively. Meanwhile, USDCAD marked a fresh multi-month low.<\/p>\n

EURUSD, although also positive, is currently taking a breather near 1.1165 after hitting a mid-August high.<\/p>\n

Risk Appetite Removes Flows from Safe-Havens<\/strong><\/h2>\n

The deterioration of risk on both\u00a0Brexit<\/a>\u00a0and trade war fronts appear to be producing more interest in high yields rather than safe havens.<\/p>\n

The EU is poised to approve another extension up to the 31st of January 2020. And, we can expect Borris\u2019 plan to receive the support to legislate his EU-accepted plan. Therefore, gold, yen and Swiss franc are under risk. A softer dollar, however, allows the assets to be muted.<\/p>\n

All haven asset trade near round levels. XAUUSD trades close to 1490, USDJPY near the round 108.50 and USDCHF near 0.9850.<\/p>\n

The dollar index (DXY) on the other hand is sliding, has fallen to July lows at the time of writing.<\/p>\n

Equities Find Momentum but Positive Oil Flows Poor<\/strong><\/h2>\n

The markets would typically expect oil to appreciate following the latest news on the trade war. And particularly on the back of increased risk appetite. That being said,\u00a0WTI oil is rather quiet<\/strong>. It seems that the US Earnings expectations are pushing stocks higher rather than receiving\u00a0support from the trade<\/a>\u00a0and Brexit updates.<\/p>\n

That being said, China\u2019s GDP may affect crude oil as the deceleration in growth could impact how much oil China buys.<\/p>\n

Geo-led bulls seem to be battling with China-led bears.\u00a0<\/strong>That leaves US oil trading at the opening price near 53.60. The SPX, however, has started the week off on positive footing and looks ready to take out breakeven stops at 3000.<\/p>\n

By <\/strong>Orbex<\/strong><\/a><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

By Orbex Risk appetite rose early on Monday on headline news surrounding Brexit and the US-China trade war. The focus for the rest of this day\u2019s trading session will be on two main points. The first is on Johnson\u2019s \u201cmeaningful\u201d vote request.\u00a0 And the\u00a0second is\u00a0whether a US-Sino trade deal is indeed possible next month, as […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-158065","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/158065","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=158065"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/158065\/revisions"}],"predecessor-version":[{"id":158075,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/158065\/revisions\/158075"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=158065"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=158065"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=158065"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}