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FX Markets: Dollar Rises, Pound FallsThe FX markets went on the move yesterday, with the dollar rising and the pound falling. The greenback managed to gain strength even as manufacturing data came in weak. Meanwhile, the royal currency dropped as more Brexit problems arose. This week, data showed the US manufacturing sector contracted in September. It fell to its weakest level in a decade. Business conditions looked lackluster on the back of the US-China trade war. On the other hand, analysts are believing that the dollar would fare better than other peers. That’s because of its relatively higher yield. The US economy so far also appears to be faring best. One analyst even pointed out that although US manufacturing was dismal, the eurozone’s is even more disappointing. The markets will be focusing on the non-farm payrolls data on Friday. Investors will be seeking clues as to the current real condition of the US economy. UK PMI, Brexit, and FX Markets Over in Europe, the currency markets aren’t looking good. The pound lost more than 50 percentage points after Ireland rejected UK Prime Minister Boris Johnson’s latest Brexit proposal. It dropped 0.48% against the dollar to 1.223. Against the euro, it lost 0.56% to 1.121. The UK’s manufacturing data also showed a contraction in the economy. Such weakening comes for the fifth month in a row, with uncertainty dominantly blurring prospects and output. The British prime minister’s plan was to set up a “buffer zone” on the Irish border. Irish foreign minister Simon Coveney called the proposals a “non-starter.” This dampened hopes for a smoother and less chaotic Brexit deal before the October 31 deadline. However, a silver lining appeared for the British pound. This was after Johnson gave a speech at the Tory conference saying that there would be no more Brexit delays.
by Financebroker
A perennial problem of the dollar and profit-taking tradingThe US dollar continues to demonstrate the resistance. It does not decrease after the Fed cuts, it ignores macroeconomic statistics, it grows amid a political scandal and a possible impeachment of Trump. The US dollar as the main asset-refuge, the growth of the dollar is a consequence of the weakness of other currencies, etc.). But why? Obviously, with time the stock of negativity will accumulate. That is why we continue to recommend the dollar sale in the foreign exchange market. We are sure that all this is compensated by a large movement, which ultimately cannot be avoided. As for yesterday, we note that our expectations regarding the data on US GDP for the second quarter were fully fulfilled (they came out within the forecast of 2%). The bears failed to seize the initiative. We also note yesterday's US trade balance data, which showed a deficit of $ 72.8 billion. This is a lot. Yes, while the markets are trying not to see that, but once again we note that sooner or later the US debt will be remembered both by the giant US debt (soon it will be $ 23 trillion), and the constant budget deficit (already exceeded a trillion) and the trade deficit (year on year) striving for a trillion) and so on. In the meantime, the main attention of the markets is focused on what is happening in the repo market. The Fed continues to flood the market with money. Injection volumes have already reached $ 100 billion per day (before that it was about $ 75 billion). Against this background, the growth of the dollar seems even more abnormal. Friday in terms of macroeconomic statistics will be relatively calm. Considering that several assets showed good growth over the week, Friday could well be a day of profit-taking, because it will be the end of the month. In this light, our recommendations for today are as follows: buy gold, sell the dollar, buy the pound and the euro, also, today you can try to buy oil. Do not forget to put hard stops in open positions.
Long
by Trade24Fx
Dollar fails Powell’s test, China and Trump keep tensionsFor the whole last week we were waiting for a symposium in Jackson Hole to be held (The Economic Symposium, held in Jackson Hole, Wyoming, is attended by central bankers, finance ministers, academics, and financial market participants from around the world. ). Fed Chairman Jerome Powell's speech on Friday was the main event. The markets were waiting for the “official” confirmation of monetary easing by the Fed, the ECB and other central banks. Attention focused on a speech by U.S. Federal Reserve chief Jerome Powell for news on whether it will cut interest rates for a second time this year to boost the world's largest economy. But at the same time, he did not specify a time limit. China intends to raise tariffs on US imported goods total $ 75 billion the decision was made in response to the USA. Besides, the import tax on American cars and auto parts will be increased. Trump, of course, reacted extremely nervously to such actions by China, promising to take retaliatory measures. China has a deserved reputation for intellectual property theft. On Friday, Trump estimated China robs the US of “hundreds of billions” a year in ideas. So there is a reason to believe that a very hot and hectic week awaits us. In this light, buying safe-haven assets seems like a good trading idea. But once again we note that the choice of the entry point is extremely important. The upcoming week promises to be calm. Attention should be paid only on the US GDP. Otherwise, the attention will be focused on the confrontation between the USA and China, as well as the Fed. Our trading preferences this week: selling the dollar, finding points for buying gold and the Japanese yen, buying the British pound and selling the Russian ruble. Also, oil sales seem appropriate.
FX:XAUUSDLong
by Trade24Fx
USD has the potential to fall 10% over the next three monthsThere is too much pressure world wide to cope with the trade wars. It's going to be a race to the bottom. Central bankers world wide are now of the view that the only way to support ailing economies is to reduce interest rates and avoid the additional burden they bring on indebted companies. After the US currencies rapid rise as an alternative to weaker global currencies the cycle is about to change as US continues to see low economic readings and political pressure mounts. The low inflation numbers in the US mean that for now the risk of higher inflation brought on by a weak dollar is an acceptable risk to protect businesses and avoid tantrums in the White House. US 10 year yields are going through the floor. Investors have already started pulling funds out of the USD.
TVC:DXYShort
by TreeDoc
GBPUSD - H&S to the upside? Can we see 1.3000 - Medium term?Looking at the 4H and the Daily, we can see the potential for an inverted H&S, with the potential to the upside (1.3000 as final target) We are at lows, around the 1.2550 zone, which has served as previous support. Price is currently above this area, and I am looking for a movement to 1.272 through to 1.28, if we can break above, we can potentially see a price correction or reversal from these area's and a continuation to complete the H&S in the 1.317 to 1.32 region. Drop me a comment, or DM lets chat... Because Pippin' aint easy... Remember Risk Management
Long
by myronemoyo
2
GBPUSD Inverse H&SLooks like a decent inverse H&S in the making here. The size of the H&S as we can see on the left is almost perfect. But when zooming in, we can see the shape is not really great. So i would be a bit careful with this one. I would like to see the right shoulder getting a bit bigger in time, so far it's too small. If we see that happen and then break up, i will very likely wait for a successful pullback before getting in. Normally i don't mind giving it a shot earlier with an H&S, but this one is not convincing on the lower time frame. Previous analysis:
by botje11
6
USD/GBP - One of Two MovesUSD/GBP = Overall the pair is in an uptrend according to monthly timeframe. Price is approaching a major key level. Price action suggests strong bullish movement. Overall I think bulls will tire at the key level and consolidate at this level. Price will then either do one of two things. 1st: Continue past the key level and further move up to the monthly uptrend line and once price hits Bears will take over immediately push price down heavily. 2nd: Once price hits the above key level consolidation will occur at this level for a bit and make a smooth transition down to the neckline of what could be a "double top". I think there is a high chance of price consolidating for a 2nd time; breaking the neckline, retesting and then move down with some momentum. Hopefully one of the two predictions will be correct in 2019. Happy trading and good luck profit hunters. Trading Journal #7 -Austin S.
by austinlmkc
Acceleration toward major supportBrexit is causing volatile market conditions with deep, quick moves. USD/GBP failed to reach the previous swing high and now is showing acceleration toward the major support around 0.75. There is confluence here with multiple Fibonacci levels and convergence of a long-term up trend support meeting short-term down trend support. I believe the fib levels will be great opportunity for discounted prices, especially if we see a reversal candle close above the support.
by philocrypt0