05 June 2019 Morning Session Analysis
Dollar extends loss following dovish Powell stance.
Dollar index measuring against its basket of six major currency pairs have extend its downfall after Federal Reserve Chairman Jerome Powell have bolstered the dovish expectation of rate cut. Following weeks of fears surrounding an uptick in US-China trade wars with recent worries focusing on US-Mexico tensions, the central bank have stated that they are “closely monitoring” the impact of trade developments and “will act appropriate” to sustain expansion. The slight dovish comment has raised expectation and signaled for a possible rate cut this year, thus dragging the market sentiment further down. Dollar index fell 0.03% to 96.94 as of writing. On the other hand, GBP/USD rose 0.05% to 1.2700 at the time of writing despite weak economic data. According to Markit Economics, business conditions in the UK construction sector have decline to 48.6, weaker than market expectation with the reading of 50.5. The data have marked its third decline in four months and also is the first contraction since July 2016. However, the pound remain unfazed by the weak data as the soft dollar with expectation of rate cut have helped support the pound. Market remain in focus on upcoming data and developments to gauge further sentiment.
As for commodities market, crude oil price remain pressured and fall 0.10% to $52.90 per barrel as of writing following surprise gain in U.S inventories. According to API, U.S crude inventories have rose unexpectedly last week by 3.5 million barrels, which is weaker than analyst expectations for a decrease of 890,000 barrels. Besides that, oil sentiment was further dragged by comments from the head of Russian state oil producer Rosneft, Igor Sechin where he stated that Russia should pump at will and he would seek compensation from the government if cuts were extended, questioning the point of a deal with OPEC to withhold supplies. Lastly, gold price extend gains by 0.09% to $1326.48 a troy ounce as of writing following weak dollar continue to increase the demand of safe-haven gold.
Today’s Holiday Market Close
Time Market Event
N/A
Today’s Highlight Events
Time Market Event
N/A
Today’s Highlight Economic Data
| Time | Market & Data | Previous | Forecast | Actual |
| 16.30 | GBP – Services PMI (May) | 50.4 | 50.6 | – |
| 20.15 | USD – ADP Nonfarm Employment Change (May) | 275K | 180K | – |
| 22.00 | USD – ISM Non-Manufacturing PMI (May) | 55.5 | 55.5 | – |
| 22.30 | CrudeOIL – Crude Oil Inventories | -0.282M | -0.849M | – |
Technical Analysis
DOLLAR_INDX, Daily: Dollar index was traded lower following prior breakout below previous support level at 97.00. MACD which illustrate bearish momentum suggest index to extend its losses towards the support level 96.35.
Resistance level: 97.00, 97.60
Support level: 96.35, 95.60
GBPUSD, H4: GBPUSD was traded higher following prior breakout above previous resistance level at 1.2690. MACD which display bullish signal suggest the pair to extend its gains towards the resistance level 1.2785.
Resistance level: 1.2785, 1.2865
Support level: 1.2690, 1.2615
EURUSD, H4: EURUSD was traded higher after breaking above previous resistance level at 1.1240. However, MACD which display diminishing bullish momentum suggest the pair to undergo short-term technical correction and retrace back towards the support level 1.1240.
Resistance level: 1.1305, 1.1360
Support level: 1.1240, 1.1180
USDJPY, H4: USDJPY remained traded in a sideway channel following prior rebound from support level 107.85. However, due to lack of signal from the MACD, a breakout above the resistance level 108.45 or below the support level 107.85 is required for further confirmation before entering the market.
Resistance level: 108.45, 109.15
Support level: 107.85, 107.40
AUDUSD, H4: AUDUSD was traded higher following prior breakout previous resistance level 0.6970. However, MACD which display diminishing bullish momentum suggest the pair to undergo short-term technical correction and retrace back towards the support level 0.6970.
Resistance level: 0.7030, 0.7070
Support level: 0.6970, 0.6930
NZDUSD, H4: NZDUSD was traded higher following prior breakout previous resistance level 0.6580. However, MACD which display diminishing bullish momentum suggest the pair to undergo short-term technical correction and retrace back towards the support level 0.6580.
Resistance level: 0.6635, 0.6675
Support level: 0.6580, 0.6540
USDCAD, H4: USDCAD was traded lower while currently testing near the support level 1.3380. MACD which illustrate persistent bearish momentum suggest the pair to extend its losses after successfully breaking below the support level.
Resistance level: 1.3435, 1.3490
Support level: 1.3380, 1.3305
USDCHF, H4: USDCHF was traded higher following prior rebound from the support level 0.9905. MACD which display diminishing bearish momentum suggest the pair to extend its rebound towards the resistance level 0.9940.
Resistance level: 0.9940, 0.9980
Support level: 0.9905, 0.9860
CrudeOIL, H1: Crude oil price remained traded in a sideway channel after rebounding from the support level 52.65. MACD which illustrate bullish bias signal suggest the commodity to extend its rebound towards the resistance level 53.85.
Resistance level: 53.85, 55.05
Support level: 52.65, 50.50
GOLD_, H1: Gold price was traded higher following prior breakout above previous resistance level at 1324.35. MACD which illustrate bullish bias signal suggest gold to extend its gains towards the resistance level 1331.15.
Resistance level: 1331.15, 1339.10
Support level: 1324.35, 1318.25