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18 September 2020                           Morning Session Analysis

 

Pound sterling jumps as central bank sounded hawkish.

Pound sterling rebounds from its session low on yesterday after Bank of England (BoE) announced their verdict with regards to monetary policy. BoE kept the interest rates unchanged at 0.10% and asset purchase target at £745 billion. They also hinted that they would stand ready to “adjust” monetary policy whenever necessary in order to support their economic recovery. The central bank also pointed out that recent UK economic data supports for the need of its current monetary policy setting. Despite higher expectation towards a faster pace of economic recovery, the central bank left the door open for negative interest rates as well as additional policy measures in order to keep the economy on track in the event of a second wave of coronavirus. However, gains on the pound sterling were limited while investors continue to monitor Brexit negotiation in between UK and EU. Investors fear that UK’s failure to secure a trade deal with EU before Brexit deadline may led to economic shock that could jeopardize pose a threat to both countries. As of writing, pair of GBP/USD ticked up 0.02% to 1.2974 while the dollar index was down by 0.32% to 92.86.

 

As for commodities, crude oil price rose 0.02% to $41.00 per barrel. Oil future prices remained well supported after weather analyst detected two other storms in the southern Gulf of Mexico which could become a cyclone in the next 48 hours. This may prolong the closure of oil refineries along Gulf of Mexico and led to a lower oil supply in short-term. Gold price rose 0.08% to $1,945.53 a troy ounce due to weaker US dollar.

 

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 Nation & Data Previous Forecast Actual
14:00 GBP – Retail Sales (Aug) 0.7% 3.6%
20:30 CAD – Core Retail Sales (MoM) (Jul) 0.5% 15.7%

 

 

Technical Analysis

DOLLAR_INDX, H1: Dollar index was traded lower following prior retrace from the higher level. MACD which illustrate bearish signal suggests the index to extend its losses towards the direction of 92.75.

 

Resistance level: 93.00, 93.10

Support level: 92.75, 92.50

 

GBPUSD, H1: GBPUSD was traded higher while currently testing 1.2985. MACD which illustrate bullish signal suggests the pair to extend its gains after closing above the resistance level.

 

Resistance level: 1.2985, 1.3030

Support level: 1.2930, 1.2875

 

EURUSD, H4: EURUSD was traded higher following prior rebound from the lower level. MACD which illustrate bullish signal suggests the pair to extend its gains in short-term.

 

Resistance level: 1.1900, 1.1995

Support level: 1.1840, 1.1800

 

USDJPY, H4: USDJPY was traded higher following prior rebound from the lower level. Diminishing downward momentum from MACD suggests the pair to experience technical correction.

 

Resistance level: 104.80, 105.30

Support level: 104.50, 104.20

 

AUDUSD, H1: AUDUSD was traded higher following prior rebound from the lower level. MACD which illustrate bullish signal suggests the pair to be traded higher in short-term.

 

Resistance level: 0.7330, 0.7340

Support level: 0.7300, 0.7275

 

NZDUSD, Daily: NZDUSD was traded higher following prior rebound from the lower level. MACD which illustrate bullish signal suggests the pair to extend its gains after closing above 0.6785.

 

Resistance level: 0.6785, 0.6920

Support level: 0.6600, 0.6510

 

USDCAD, H1: USDCAD was traded lower following prior closure below 1.3155. MACD which illustrate bearish signal suggests the pair to extend its losses in short-term.

 

Resistance level: 1.3155, 1.3195

Support level: 1.3125, 1.3095

 

USDCHF, H4: USDCHF was traded lower following prior retrace from the higher level. MACD which illustrate bearish signal suggests the pair to extend its losses in short-term.

 

Resistance level: 0.9110, 0.9145

Support level: 0.9050, 0.9005

 

CrudeOIL, H4: Crude oil price was traded higher while currently testing at 41.30. MACD which illustrate bullish signal suggests its price to extend further up after closing above 41.30.

 

Resistance level: 41.30, 41.90

Support level: 40.70, 39.85

 

GOLD_, H4: Gold price was traded higher following prior rebound from the lower level. MACD which illustrate diminished downward momentum suggests its price to be traded higher in short-term.

 

Resistance level: 1966.00, 1990.40

Support level: 1941.70, 1925.00