17 July 2019 Morning Session Analysis
Dollar surged over upbeat Retail Sales data, pound plunges.
Index dollar which measures its value against a basket of six major currency pairs surged back to its 97.00 level following higher than expected Retail Sales data. According to US Census Bureau, US Retail Sales and Core Retail Sales data in June came in at 0.4%, exceeding economists forecast of 0.1%. The data which acts as an indicator to measure consumer spending in the country had since reduced investors’ expectations of an aggressive policy easing by the Fed. Earlier this month, Fed monetary policy stance was rather dovish, signaling a possible aggressive easing by cutting rates more than just 25 basis point. However, with recent bullish jobs and retail sales data, the Fed is much likely to cut cash rates by 25 basis point during its July policy meeting while remaining cautious towards future US economic conditions. In other news, pair of GBP/USD plunged to its 3-months low amid stronger dollar and Brexit risks. According to recent reports, both leading candidate, Boris Johnson and Jeremy Hunt for the new UK prime minister, had emphasized on opposing the Irish backstop issue, which reduced the chance of Brexit with a deal as the EU is highly unlikely to renegotiate with the current terms in place. Since the UK is left with two options, no-deal Brexit or no Brexit at all, and both candidates vowed to deliver Brexit by 31st October, the chances of a no-deal Brexit had increased dramatically. As of writing, dollar index ticked higher by 0.01% to 96.97 while pair of GBP/USD ticked higher by 0.04% to 1.2405.
In the commodities market, crude oil price pared its losses by 0.30% to $57.59 per barrel. Oil prices was falling yesterday following lifted Middle East tensions as commented by US President Donald Trump when he said that progress had been made with Iran. Both countries had showed their willingness to avoid a war while Iran officials are now ready to negotiate on their missile program. Furthermore, the oil price received further downward pressure when the American Petroleum Institute (API) reported a much lower drawdown in inventory as much as 1.4M last week despite ongoing efforts from OPEC and its allies to further production cut. Next, gold price inched higher by 0.02% to $1405.75 a troy ounce. The safe-haven gold plunged from its top-levels yesterday amid upbeat US data and stronger dollar.
Today’s Holiday Market Close
Time Market Event
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Today’s Highlight Events
Time Market Event
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Today’s Highlight Economic Data
| Time | Nation & Data | Previous | Forecast | Actual |
| 16.30 | GBP – CPI (YoY) (Jun) | 2.0% | 2.0% | – |
| 17:00 | EUR – CPI (YoY) (Jun) | 1.2% | 1.2% | – |
| 20:30 | USD – Building Permits (Jun) | 1.299M | 1.300M | – |
| 20:30 | CAD – Core CPI (MoM) (Jun) | 0.4% | – | – |
| 22:30 | CrudeOIL – Crude Oil Inventories | -9.499M | -2.694M | – |
Technical Analysis
DOLLAR_INDX, H4: Dollar index was traded higher following prior breakout above the previous resistance level 96.70. MACD which indicate bullish momentum signal with the formation of golden cross suggest the dollar to extend its gains towards the resistance level 97.10.
Resistance level: 97.10, 97.55
Support level: 96.70, 96.30
GBPUSD, H4: GBPUSD was traded lower following prior breakout below previous support level 1.2440. However, MACD which starting to display diminishing bearish momentum suggest the pair to experience a short term technical correction towards back the current resistance level 1.2440.
Resistance level: 1.2440, 1.2510
Support level: 1.2295, 1.2230
EURUSD, H4: EURUSD was traded lower following prior breakout below the previous support level 1.1235. However, MACD which starting to display bullish bias signal suggest the pair to undergo a technical correction in short term towards the resistance level 1.1235.
Resistance level: 1.1235, 1.1280
Support level: 1.1185, 1.1145
USDJPY, H4: USDJPY was traded higher following recent breakout above the previous resistance level 108.15. However, MACD which display diminishing bullish momentum suggest the pair to be traded lower as a technical correction in short term towards the current support level 108.15.
Resistance level: 108.60, 109.05
Support level: 108.15, 107.60
AUDUSD, H4: AUDUSD was traded lower following prior retracement from the resistance level 0.7035. MACD which illustrate bearish momentum signal with the formation of death cross suggest the pair to extend its retracement towards the support level 0.7000.
Resistance level: 0.7035, 0.7065
Support level: 0.7000, 0.6965
NZDUSD, H4: NZDUSD was traded lower following prior retracement from the resistance level 0.6720. MACD which illustrate bearish bias signal with the formation of death cross suggest the pair to extend its retracement towards the support level 0.6650.
Resistance level: 0.6720, 0.6770
Support level: 0.6650, 0.6600
USDCAD, H4: USDCAD was traded higher following prior rebound from the support level 1.3040. MACD which illustrate bullish bias signal suggest the pair to extend its gains towards the resistance level 1.3105.
Resistance level: 1.3105, 1.3160
Support level: 1.3040, 1.2970
USDCHF, H4: USDCHF was traded higher following recent breakout above the previous resistance level 0.9870. However, MACD which indicate diminishing bullish momentum signal suggest the pair to experience a short term technical correction towards the support level 0.9870.
Resistance level: 0.9935, 1.0005
Support level: 0.9870, 0.9800
CrudeOIL, H4: Crude oil price was traded lower following prior breakout below previous support level 57.85. MACD which display persistent bearish momentum suggest the commodity to extend its losses towards the support level 56.00.
Resistance level: 57.85, 59.25
Support level: 56.00, 54.50
GOLD_, H4: Gold price remained traded flat in a sideway channel while currently testing the support level 1403.15. MACD which display bearish bias signal suggest the commodity to extend its losses after it breaks below the support level 1403.15.
Resistance level: 1421.40, 1437.95
Support level: 1403.15, 1386.35