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Gold rally has stalled After a three-day rally, gold prices turned negative on Thursday as risk-on sentiment has improved on positive developments globally. The bullion jumped to the $1,310 area yesterday but failed to preserve the bullish momentum and retreated, testing the key $1,300 handle again. On Wednesday, the U.S. Treasury Secretary Steven Mnuchin said the US and China have agreed on a mechanism to police any trade agreement they reach. Which fueled investor optimism over trade. Also, investors are cheering news from the UK. In particular, the EU leaders and the U.K. agreed to a flexible extension of the Brexit deadline until Oct. 31. Besides, the dollar feels somehow uncomfortable these days, and the bullion derives additional support from this factor. Technically, gold needs to keep above the $1,300 psychological handle in order to avoid a more aggressive profit-taking in the short term. Once below the $1,280 region, the selling pressure will increase. On the upside, the $1,310 level remains in focus.
TVC:GOLD
by HelenRush
Brent clings to the $71 barrier After a limited correction on Tuesday, crude oil prices are trying to resume the rally today, with Brent struggles to firmly get back above the $71 figure a jump to fresh five-month highs around $71.30 yesterday. The IMF cut its forecast yesterday to the lowest since the financial crisis, which stoke fears that global growth is slowing and curbed demand for riskier assets including oil. Besides, the API report showed that the US crude oil inventories increased 4 million barrels last week, which put the prices under some pressure as well. On the other hand, the bullish catalysts remain intact for the market. And as long as the general picture remains positive, Brent will likely remain in the upper end of the current range. But should the risk sentiment continue to deteriorate in the short term, some corrective moves may come into play again. In the near term, the $71 level is the key region for traders.
OANDA:BCOUSD
by HelenRush
EURUSD upside limited so far EURUSD extends its recovery since Monday, with the pair seems to struggle around the 1.1280 region that is standing on the way to the 1.13 handle. The euro derives support from a widespread dollar weakness, while the threat of US tariffs on the EU limits the upside impetus. Interestingly, Istat just announced no change to Italy’s 2019 GDP growth which stood at 0.9%. 2017 GDP growth was revised up to 1.7% from 1.6% previously, while no changes were made to 2017, 2018 deficit-to-GDP ratios. It is somehow positive for the single currency but the problem is that the Italian economy that slipped into a technical recession late last year has yet to see a real recovery from the crisis. In the short-term, the pair will likely remain in the familiar range, with the price action may get muted ahead of the major events – the ECB meeting and FOMC meeting minutes, both due on Wednesday. So in the coming days, EURUSD could challenge the 1.13 barrier should the Fed disappoint and the European central bank shows no explicit dovishness.
by HelenRush
Libyan crisis drives the yen higher Global financial markets started the new trading week on the defensive as trade-related optimism was overweighed by geopolitical concerns. In particular, Libyan militias battling for control of the country’s capital, Tripoli, launched air strikes against one another on Sunday. The US Secretary of State Mike Pompeo said that the US required the Libyan National Army loyal to Gen. Khalifa Haftar to stop its offensive on Tripoli. Against this backdrop, risk sentiment has deteriorated, which fueled the safe-haven yen demand. USDJPY, which rose to the 111.80 region late last week, turned lower on Monday and got back below the 200-DMA around 111.50. The pair so far registered a low of 111.34 and so far stays relatively firmly above the 111.00 handle. Amid rising geopolitical tensions, the yen could gain further in the short term should the escalation continue. On the other hand, however, fresh positive news from the US and China could lift investor sentiment again. So, the downside potential for the USDJPY pair looks limited in a bigger picture.
by HelenRush
Gold struggles for direction At the start of the week, gold prices tried to recover above the $1,300 handle but failed and since then the bullion has been directionless, oscillating around the $1,290 level. Yesterday, the precious metal briefly touched a one-month low below $1,281 amid dollar recovery but finished the day in the positive territory. Today, the prices are under pressure again. The sentiment towards gold looks mixed amid the factors that are pulling investors in opposite directions. In particular, the US-China trade talks are moving towards a deal, with the US President Donald Trump said on Thursday the two sides could announce a deal within four weeks. This fuels market optimism and adds to risk-on sentiment across the global financial markets. On the other hand, Brexit uncertainty and evidence of global slowdown continue to cap bulls and thus limit the downside potential in gold prices. In the short term, the bullion will likely continue to trade around the $1,290 figure unless the upcoming US NFP employment data disappoint and send the riskier assets lower, fueling demand for safe-haven metal.
TVC:GOLD
by HelenRush
Brent retreats from fresh tops After reaching fresh five-month highs around the $70 psychological mark, Brent retreated slightly yesterday, with the bearish pressure is intensifying on Thursday as the prices are flirting with $69 after data showed a larger-than-expected jump in U.S. crude inventories. According to the EIA report, inventories rose 7.2 million barrels to 449.5 million barrels in the week ended March 29, while production increased to 12.2 million barrels per day, which is a new record high. In general, market reaction to the report was rather muted but anyway played against the bulls along with technical factors as the psychological level has deterred buyers.  In a wider picture, the market is still supported by OPEC efforts, US sanctions against Iran (and potentially tighter sanctions) and Venezuela, and expectations of a steady demand in the coming months. A break below $69, should the current bearish correction will continue, will open the way towards the $68.80 intermediate support.
OANDA:BCOUSD
by HelenRush
Yen hit by trade optimism After some hesitation on Tuesday, USDJPY resumed the upside move today, with the pair registered fresh two-week highs above the 200-DMA, at 111.57. The next bullish target now comes at 111.70 which is standing on the way to the key 112.00 handle. The yen demand turned sour amid rising optimism over the US-China trade talks that are resuming today in Washington. The renewed bullishness on negotiations was due to the reports that the two countries have resolved most of the issues standing in the way of a deal to end their long-running trade dispute. In this context, fresh news from this front will set the direction for the pair in the near term as further signs of progress could push the greenback closer to the mentioned 112.00 barrier. On the downside, a potential bearish correction will bring the 111.00 figure back in focus. Apart from talks, market participants will also closely monitor the incoming US data, with the key release – NFP employment report - due on Friday.
by HelenRush
EURUSD may test 2019 lows The sentiment surrounding the common currency remains negative, with EURUSD is nursing losses for a sixth day in a row. The pair is flirting with the 1.12 important support for the first time in nearly a month, and a break below this level could open the way towards 2019 lows around 1.1175. Poor inflation figures in the euro area confirmed the slowdown in the region, which suggests the ECB won’t dare to start hiking rates in the medium term. In the short term, signs of waning risk-on sentiment after strong Chinese data add to the negative pressure on the euro. Meanwhile, the dollar demand persists, motivating the pair to decline further. In the longer-term, political risks will rise for the single currency in light of the upcoming parliamentary elections in the EU, with the potential increase of the populist power could hurt the euro and drive the pair substantially lower.
by HelenRush
Oil lifted by risk-on sentiment Crude oil prices jumped higher on Monday due to a general improvement in risk sentiment at the start of a new week, month and quarter. Brent opened with a bullish gap and regained the $68 handle which remains in market focus, standing on the way to the key $70 psychological resistance. The market is supported by the latest Baker Hughes data that the number of oil rigs operating to the lowest level in nearly a year. Drillers cut eight oil rigs in the week to March 29, bringing the total count down to 816. The fact that drilling has slowed suggests the oil output could at least remain steady in the weeks to come. Another bullish factor for the oil market is fresh data from China. Official China PMI manufacturing rose to 50.5 in March, up from 49.2 - the largest monthly rise since 2012. The report helped to ease concerns over the country’s economy and oil demand. Further progress in the US-China trade talks added to the positive sentiment in the market. Against this backdrop, Brent could refresh 2019 highs above $68.50 in the near term should risk sentiment remain elevated. On the downside, the prices need to stay above the $67 threshold in order to avoid an aggressive profit-taking.
OANDA:BCOUSD
by HelenRush
Gold at fresh lows amid trade optimism Gold continues to lose ground for a fourth day in a row and head for the biggest monthly fall in eight months. The bullion was rejected from late-February highs around $1325 on Monday and drift lower since then amid a fairly robust dollar demand and growing investor optimism over the US-China trade talks. The two world’s largest economies started a new round of talks yesterday in another attempt to end the nearly year-long trade war. U.S. Treasury Secretary Steven Mnuchin said today he had a productive working dinner in Beijing. Meanwhile, White House economic adviser Larry Kudlow said the United States may drop some tariffs if a trade deal is reached while other restrictions will stay in place to ensure Beijing's compliance. In general, the latest comments and headlines suggest that the two countries may announce further progress in their relations and new steps towards a deal. In this scenario, gold prices could come under additional selling pressure as risk sentiment will improve further. The short-term technical outlook has deteriorated after a break below the $1300 support area. The next target for the bears lies at $1285. Once below this level, the $1280 figure will come into play.
TVC:GOLD
by HelenRush
USDJPY: trade talks in focus USDJPY is grinding lower for a second day on Thursday, with the price has slipped to the 110.00 area amid the prevailing risk aversion. Traders continue to closely monitor developments in the bond markets as the yield on the benchmark 10-year Treasury note returned to its lowest level since 2017 on Wednesday. The yen demand is also due to nervous expectations of the next round of US-China trade talks due to resume today. According to China's commerce ministry, Beijing is in full swing with the US on a trade deal and both sides have achieved progress in phone calls, but there remains much work to do. In the near term, any signs of progress on this front could provide support to the riskier assets and thus weaken the safe-haven yen demand. In this scenario, the pair may bounce from the lows around 110.00 and get back above 110.50, with the next target lies around 110.70. This level is the immediate obstacle for bulls and a barrier on the way to the 112.00 handle. In the weekly charts, USDJPY needs to get back above the 100-SMA at 110.70 in order to further regain ground after a plunge seen last week.
by HelenRush
Oil prices: growth concerns cap the upside potential Crude oil prices struggle to extend the bullish momentum but the overall bias remains positive on Wednesday. Brent has settled around $67.50 and still struggles to get back above the $68 barrier. Global growth concerns reemerged in the financial markets, which poses a threat for the current upside attempts. Chinese industrial profits contracted 14% y/y in February, much softer than the -1.9% outcome in January. This signal may yet emerge as another worry for traders. Apart from that, the RBNZ became the latest central bank to warn about a slowdown in global economy, while the latest economic data from the US add to recession worries. Against this backdrop, risk aversion may intensify in the short term, which is negative for commodities. Also, dollar demand remains rather robust amid risk-off sentiment and weakness in the European currencies. But should the EIA report come out as bullish, Brent could derive some short-term support from the official release.
OANDA:BCOUSD
by HelenRush
EURUSD stuck around 1.13 The greenback started the week on a downbeat note amid a decline in the US Treasury yields. As a result, EURUSD managed to recover some of the Friday’s steep losses. At the same time, the upside potential was limited amid the risk aversion sparked by renewed fears about the outlook for the global economy as a result of inversion of the 3-month and 10-year Treasury yields for the first time since 2007. The common currency derived additional support from better-than-expected German Ifo survey which showed that business climate improved for the first time after six consecutive months of declines, while expectations gauge rose to 95.6 versus 94.0 expected. In the short term, the pair’s direction will depend on the general sentiment towards the dollar as well as on the investor mood in the global financial markets. On Tuesday, EURUSD has been trading under some pressure as investors remain cautious despite the risk sentiment has improved somewhat. From a technical perspective, the pair needs to get firmly back above the 1.13 figure and hold above the 1.1285 intermediate support. Technical indicators in the short-term charts are holding in the bearish territory.
by HelenRush
Risk-off sentiment drives gold higher Gold prices extend gains on Monday, fueled by the risk aversion that has intensified at the start of a new trade week. The bullion is trading not far from the highs of this month, registered on Thursday around $1,320. In the short-term charts, the prices were pushed into overbought territory, which suggests some setbacks could occur in the near term. Investor sentiment has deteriorated after a batch of dismal economic data from major economies on Friday that brought back fears over an economic slowdown. Additionally, the dollar demand remains subdued after a dovish shift in the Fed policy last week. All these factors are playing into gold’s hands. On the other hand, the greenback seems to remain the best of a bad bunch for now as the US currency is benefitting from a series of bad economic data in the euro area as well as from the ongoing Brexit drama. This in turn caps demand for the yellow metal. In a wider picture, the bullion may yet refresh March highs after a pullback as traders could seek to re-enter longs amid the increasing worries over the health of the global economy.
TVC:GOLD
by HelenRush
Brent struggles to make another breakthrough Crude oil prices have broken fresh four-month highs on Thursday, with Brent touched a $68.44 figure and started to retreat, clinging to the $68 figure. The general picture in the market remains bullish as the prices have been rallying for a third week in a row. The latest ascent in Brent was due to a widespread dollar weakness on the aftermath of the Federal Reserve meeting as the US central bank’s tone was even more dovish than expected. However, the greenback seems to have digested the message and is now making recovery attempts, which caps the upside momentum in the oil market in the short term. Despite the prevailing positive tone, oil traders remain nervous amid conflicting reports on US-China trade relations. There earlier news that China was resisting U.S. demands was interpreted as an obstacle on the way to striking a trade deal between the two world’s largest economies. Technically, Brent needs to defend the $68 figure in order not to attract a more aggressive profit taking towards the end of the trading week. A break above $70 looks unlikely at this stage due to the remaining investor uncertainty over the US-China trade talks and the outlook for the global economy.
OANDA:BCOUSD
by HelenRush
EURUSD rally stalled The dollar outperforms its major rivals on Wednesday as investors await the outcome of the FOMC meeting. The muted upside momentum reflects some corrective flows after the recent drawdown amid positioning ahead of the Fed. EURUSD rally has stalled around a tough local resistance 1.1360, where the 100-DMA lies. Further direction in the pair will depend on the tone from the Federal Reserve. As many traders expect the central bank will strike a dovish tone, any hints at the possibility of one hike this year could send the greenback higher across the board. On the other hand, should Powell admit the downside risks for the global economy, it will stoke concerns and sour investor sentiment in the global financial markets. EURUSD needs to overcome the above mentioned resistance in order to regain the 1.14 figure that stands as the key immediate target for the bulls. On the downside, the 1.1325 level comes as the intermediate local support on the way to 1.13 and then 1.1285.
by HelenRush
USD: Fed meeting looming As the Federal Reserve meeting looming, market activity is getting dampened, with US Treasury yields is little changed, hovering around 2.60%. the greenback is mostly lower against the majors after a mixed trading on Monday. Traders and analysts are weighting in on what to expect from the upcoming FOMC meeting that concludes on Wednesday. The central bank will leave its interest rates unchanged, confirming its “patient” approach to policymaking as the Federal Reserve has adopted a more dovish position since the start of 2019. Markets will focus on the forecasts provided by policy makers in the so-called dot plot. It is expected that the Fed will signal just one hike in 2019 (or no hike at all) and one more in 2020 instead of forecasting two rate rises this year and one in 2020. If so, the dollar could get under the additional downside pressure against major counterparts. But as a more dovish scenario has been mostly priced in already, the potential decline could be short-lived and limited.
AMEX:USD
by HelenRush
Oil rally has stalled but could be resumed Brent crude gained 2.2% last week and registered fresh four-month highs marginally above the $68 handle. The barrel failed to confirm a break of this level but remains elevated, having settled above the $67 figure on Monday. The general sentiment in the market remains positive due to a combination of factors including OPEC-led supply cuts, US sanctions on Iran and Venezuela, supply disruptions, signs of slowing activity in the US shale fields, and a weaker dollar. This week, the FOMC meeting will be in focus with most investors, citing the latest comments by the officials, expect the central bank to sound dovish, which could lift risk sentiment further and put the dollar under additional pressure. If so, Brent may receive some support and make fresh bullish attempts from the current levels. Also, the market will be traditionally affected by fresh inventory and output data from the US. Further decline in stockpiles would be market-positive, as well as fresh signs of progress in the US-China trade talks. Technically, Brent needs to regain the $67.70 handle to target the $68 barrier once again.
OANDA:BCOUSD
by HelenRush
Gold demand reemerged after a dip Gold prices fell sharply on Thursday amid a stronger dollar demand across the board. The bullion retreated from the $1,310 level and closed below $1,300. By the way, it was the worst day for the precious metal since the beginning of this month. However, after a sell-off, the bullion resumed the upside move and tries to settle above the $1,300 psychological level despite the generally positive investor sentiment in the global financial markets. The decline was driven mostly by weak data out of China, stronger dollar and some corrective moves after a two-day rally. In a wider picture, gold still has the upside potential as the greenback feels somehow uncomfortable, while investors see a stall in US-China trade talks amid the reports that a meeting between Trump and Xi to sign a trade deal won’t occur this month and is more likely to happen in April at the earliest. In the near term, the yellow metal needs to get back above the $1,310 level, while on the downside, an important support comes around $1,290. A more significant support level lies at $1,280 but the risk of a break below this level is rather low now.
TVC:GOLD
by HelenRush
EURUSD: upside momentum wanes After four days of gains, EURUSD shows signs of waning upside momentum on Thursday. As a result, the pair has reversed last week’s post-ECB sell-off, when the prices dropped to 21-months lows below the 1.12 handle. The advance was mainly due to a weaker dollar demand as the government bond yields hovering near weekly lows. Hopes for avoiding hard Brexit played into the euro’s hands as well. Meanwhile, the euro zone industrial production rose by 1.4% on a monthly basis, beating market’s expectations. And German inflation was more or less in-line with initial estimates and didn’t affect sentiment around the common currency. Looking ahead, EURUSD could resume the ascent should dollar demand remain subdued. However, it looks like that at this stage, the pair is preparing for a bearish correction that could take place before the end of this week. Technically, a clear break above the 1.1340 resistance is needed for further rally. This region looks rather strong, and the pair will hardly be able to firmly settle above it without additional catalysts or drivers.
by HelenRush
Oil market: upside momentum is fading Crude oil prices rose marginally on Tuesday, with Brent made a false break above the $67 handle. After reaching fresh three-week highs around $67.40, prices retreated and settled below $67. Today, the barrel is clinging to the psychological resistance, showing signs of a fading momentum. The API reported that US crude stockpiles fell by 2.6 million barrels for the week ended March 8, while that gasoline supplies dropped by 5.8 million barrels. Traders cheered the data but the overall reaction was subdued as investor sentiment in the global financial markets has deteriorated after UK Prime Minister’s revised Brexit deal was rejected in Parliament, increasing the odds of a ‘no-deal’ divorce. Despite the prices are rising for a third day in a row, the bullish momentum seems to be fading now, which could be a warning sign for buyers. Should the official report by the EIA come worse than API’s estimates, Brent could face some profit taking. Only a clear break above $67 will brighten the short-term technical outlook.
OANDA:BCOUSD
by HelenRush
USDJPY: slow but steady  Despite the risk-on sentiment across the markets, fueled by recent Brexit news, the USDJPY pair struggles to show a sustainable rally. The bulls still struggle with the 112.00 barrier but first need to settle above the 100- and 200-DMAs around 111.40. The pair tried to overcome this barrier earlier this month but was rejected from 2019 highs.  The UK PM May managed to clinch some assurances on the Irish backstop from the European Commission, which supported risk demand early on Tuesday. Now, investors expect the parliamentary vote on May’s Brexit deal. These developments will continue to set the tone for global investors in the short term, and the positive scenario could push the yen further down. The progress in the USDJPY ascent is really slow but the uptrend from the flash-crash low of 104.70 remains intact, so a break higher could be just a question of time now. In the weekly charts, the dollar needs to keep above the 100-SMA at 110.80 so that to have a chance to challenge the 112.00 handle once again. A daily close above the mentioned moving averages will improve the immediate technical picture.
by HelenRush
Brent focused on the $66 handle Brent crude is trending higher on Monday, after a brief dip below the $64 handle on Friday. The barrel has recovered since to the levels above $66 but is yet to confirm a break of this handle as the sentiment in the market looks fragile. On the one hand, crude continues to derive support from supply cuts by OPEC and US sanctions on Venezuela and Iran. Traders are assessing the recent hints by the cartel at the possible continuation with the supply cuts for six months. As a reminder, the next OPEC+ meeting takes place in Vienna on April 17-18. Until then, the prices will likely stay afloat amid expectations of the deal extension. But on the other hand, the rally attempts may be limited by the lingering concerns over the global growth, especially after China trimmed down their growth targets for 2019, which raised fresh demand concerns. Technically, Brent needs to regain the $67 barrier to confirm a more bullish sentiment in the market. In the short-term, prices will likely remain in a familiar range, with focus will remain on the $666 level.
OANDA:BCOUSD
by HelenRush