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21.02.2019 Daily Bulletin
The parity briefly reached 1.1370 before the FOMC minutes but the less-than-expected dovish report gave a boost to the US Dollar. The price returning above the substantial 1.1340 level creates chances for a rebound to 1.1370,1.1400 and then 1.1430. The spike will depend on ECB account of its monetary policy meeting. If the publication is more dovish than expected, the price will decline to 1.1320 and 1.1300. The 1.1270 level is next as a support. Despite ECB’s account, plenty of other macroeconomic releases scheduled today may add volatility to the parity. US home sales, initial jobless claims, goods orders, and Philadelphia Fed manufacturing reading are to be released Wednesday. Manufacturing and services PMI data is set to be published today for both the US and the Eurozone.
Support: 1.1320 – 1.1300 – 1.1270
Resistance: 1.1370 – 1.1400 – 1.1420
May's fruitless visit to Brussels and Fed's FOMC minutes knocked the Pound down, erasing almost all Wednesday gains. The parity at the time of writing this analysis was once again testing the 1.3030 level. It is a busy day in terms of US data, thus better than expected results will back the greenback. Further decline means the 1.3000 level will act as a significant support. Following that are 1.2960 and 1.2930, two previous hesitation areas. In case the parity rises up, it will first aim for 1.3050 level. The next two resistance lines on the horizon will be 1.3070 and 1.3100.
Support: 1.3000 – 1.2960 – 1.2930
Resistance: 1.3050 – 1.3070 –1.3100
The Asian session has been busy with Japanese macroeconomic releases. Foreign bonds buying declined to 193.7B from 996.6B but foreign investments in Japanese stocks rose to -52.9B from -101.9B. Manufacturing PMI for February rose by 48.5, it’s less than the 50.4 forecast and All Industries Activity Index rose by - 0.4 percent, lower than the expected -0.2 percent. However, the parity price didn’t rise, instead, it hesitates to swing below the 111.00 level. PMI, initial jobless claims and durable goods orders data for the US stay in focus as it may be decisive for the parity’s direction. A positive outcome could evoke bullish tendency and the parity price would climb above 111.00, towards 111.50 and 112.00. Weaker than expected US figures will press the price first to 110.50, then 110.20 and eventually to 110.00.
Support: 110.50 – 110.20 – 110.00
Resistance: 111.00 – 111.50 – 112.00
The FOMC minutes that came less than dovish tempered with Gold’s rally. The report said the Fed expects slower growth in 2019 and plans to halt the balance sheet reduction by the end of this year. If the inflation surpasses 2 pct target, the rate hikes might then be considered. Despite the inflation near the target, strong labor sector is another positive element. The Gold price found resistant at 1346 level. Macroeconomic releases today will most likely increase the price fluctuation. If the data comes in favor of the Dollar, the price will edge down to 1336, then 1330. After that, 1326 will be watched. Weaker than expected data will push the price up, first to 1346 again, then 1350 and 1355 levels.
Support: 1336 – 1330 – 1326
Resistance: 1346 – 1350 – 1355
The price broke the level of 70.00 and currently it is approaching 71.00 level as it trades at the highest levels since November. Nigeria, Africa’s largest oil producer, is willing to follow the steps of Saudi Arabia in cutting its crude output in order to help support higher prices. EIA reported that the US shale production is about to hit the record output of 8.4 mln bpd in the following month. Weekly US crude oil stocks report by the American Petroleum Institute showed a 1.260M, compared to the last week’s reading at -0.998M. As the price rally continues, we will see 71.00 and 71.50 levels as next. If the upcoming US crude oil inventories and cushing oil inventories data tempers the price surge, 70.20, then 70.00 and 69.40 will be eyed.
Support: 70.20 – 70.00 – 69.40
Resistance: 71.00 – 71.50
ECB account of monetary policy meeting, Manufacturing PMI and services PMI for Germany the Eurozone will stay in the focus today. While the Sino-US negotiations show progress, the specter of US President Trump’s tariffs is looming over Europe. Trump threatens the bloc with the tariffs on auto imports if the trade deal is not reached. It comes after Commerce Department delivered a report that sources said found European car imports constitute a national security threat to the US. German inflation data matched the expectations at -0.8 percent. The price started a day with an upward gap. If the case of the upside movement, we will look at 11 500 and then 11 600 levels. If the price drops, 11 400 will be price’s first support. After that 11 300 will be targeted.
Support: 11 400 – 11 300
Resistance: 11 500 – 11 600