14 June 2018 Daily Analysis
Dollar wilts as rate hike cycle may end sooner.
Greenback whipsawed with high volatility on early Thursday morning as US Federal Reserve concludes their two-day policy meeting with an unexpected hawkish rhetoric. The Federal Reserve as widely expected, raised their target fund rates today for the second time in 2018 by 25 basis points to the range of 1.75% – 2.00%. FOMC unexpectedly raised its forecast and made amendment to their dot plot, citing 4 rate hikes in 2018 instead of 3 following robust economic growth and solid progression in household spending. The Feds raised their GDP outlook from 2.7% to 2.8% while lowered their unemployment expectation from 3.8% to 3.6% for the year. Although greenback rose after the announcement, Fed postulate that rate hike speed may be fastened but terminal rate is still unchanged. The comment signifies that rate hike cycle could end sooner than expected, evoking higher volume of pullback from the dollar-bull. For the day ahead, investors will turn their focus to the European Central Bank (ECB) whom may release tapering details on their massive QE program which is set to end this September. As of writing, the dollar index slipped 0.25% while last quoted around 93.50.
In the commodities market, crude oil price extended gains by 0.05% to $66.62 per barrel after EIA reported that US crude oil stock was decreased by 4.143 million barrels, exceeding economist forecast to decrease by 1.440 million barrels last week. Similarly, gold price ticked up 0.03% to $1,299.18 a troy ounce over the backdrop of bearish greenback.
Today’s Holiday Market Close
Time Market Event
N/A
Today’s Highlight Events
Time Market Event
20:30 EUR ECB Press Conference
Today’s Highlight Economic Data
| Time | Nation & Data | Previous | Forecast | Actual |
| 09:30 | AUD – Employment Change (May) | 22.6K | 18.8K | – |
| 09:30 | AUD – Unemployment Rate (May) | 5.6% | 5.5% | – |
| 10:00 | CNY – Industrial Production (YoY) (May) | 7.0% | 6.9% | – |
| 14:00 | EUR – German CPI (MoM) (May) | 0.5% | 0.5% | – |
| 16:30 | GBP – Retail Sales (MoM) (May) | 1.6% | 0.5% | – |
| 19:45 | EUR – Deposit Facility Rate | -0.40% | -0.40% | – |
| 19:45 | EUR – ECB Marginal Lending Facility | 0.25% | 0.25% | – |
| 19:45 | EUR – ECB Interest Rate Decision (Jun) | 0.00% | 0.00% | – |
| 20:30 | USD – Core Retail Sales (MoM) (May) | 0.3% | 0.5% | – |
| 20:30 | USD – Import Price Index (MoM) (May) | 0.3% | 0.5% | – |
| 20:30 | USD – Retail Sales (MoM) (May) | 0.2% | 0.4% | – |
| 20:30 | USD – Initial Jobless Claims | 222K | 223K | – |
GBPUSD
GBPUSD, H1: GBPUSD remains traded within a descending channel following prior retracement from the top level. Both MACD histogram and Stochastic Oscillator which illustrate bearish signal suggests the pair to extend its losses in short-term after closing below the 20-MA line (green).
Resistance level: 1.3375, 1.3410
Support level: 1.3350, 1.3320
EURUSD
EURUSD, H1: EURUSD extended gains following prior breakout from the top level of descending triangle. However, MACD histogram which illustrate diminishing upward momentum may suggests the pair to be traded lower in short-term as technical correction.
Resistance level: 1.1830, 1.1865
Support level: 1.1790, 1.1765
USDJPY
USDJPY, H1: USDJPY remains traded within an ascending channel while recently rebounded from the target of 110.00. MACD histogram which illustrate diminishing downward momentum may suggest the pair to extend its gains after closing above the 60-MA line (green).
Resistance level: 110.55, 111.00
Support level: 110.00, 109.40
CrudeOIL
CrudeOIL, H1: Crude oil price was traded in a consolidation phase near the top level of ascending channel. Recent retracement may suggest the commodity price to be traded lower in short-term as technical correction before extending its gains in accordance to the channel formation.
Resistance level: 66.80, 67.15
Support level: 66.30, 65.85
GOLD
GOLD_, H1: Gold price remains traded within a sideways channel following prior retracement from the top level. MACD histogram which illustrate diminished upward momentum may suggest the commodity price to extend its losses after closing below the support level of 1298.70.
Resistance level: 1301.30, 1303.80
Support level: 1298.70, 1294.70