Press review - page 535

[Sergey Golubev]

USD/CAD Intra-Day Fundamentals: Bank of Canada Overnight Rate and range price movement 

2017-07-12 15:00 GMT | [CAD - Overnight Rate]

• past data is 0.50%
• forecast data is 0.75%
• actual data is 0.75% according to the latest press release

if actual > forecast (or previous one) = good for currency (for CAD in our case)

[CAD - Overnight Rate] = Interest rate at which major financial institutions borrow and lend overnight funds between themselves. 

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From official report :

• "The Bank of Canada is raising its target for the overnight rate to 3/4 per cent. The Bank Rate is correspondingly 1 per cent and the deposit rate is 1/2 per cent. Recent data have bolstered the Bank’s confidence in its outlook for above-potential growth and the absorption of excess capacity in the economy. The Bank acknowledges recent softness in inflation but judges this to be temporary. Recognizing the lag between monetary policy actions and future inflation, Governing Council considers it appropriate to raise its overnight rate target at this time."
• "Governing Council judges that the current outlook warrants today’s withdrawal of some of the monetary policy stimulus in the economy. Future adjustments to the target for the overnight rate will be guided by incoming data as they inform the Bank’s inflation outlook, keeping in mind continued uncertainty and financial system vulnerabilities."
• "The next scheduled date for announcing the overnight rate target is September 6, 2017. The next full update of the Bank’s outlook for the economy and inflation, including risks to the projection, will be published in the MPR on October 25, 2017."

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USD/CAD M5: range price movement by BOC Overnight Rate news event 

[Sergey Golubev]

NZD/USD - daily ranging bullish; 0.7344 is the key (based on the article)

Daily price is above 100 SMA/200 SMA levels located in the bullish area of the chart: the price is testing 0.7309 resistance level to above for the 0.7344 nearest target to re-enter for the primary bullish trend to be continuing.

• "The New Zealand is attempting to make good on a break of rising trend support guiding the currency higher since mid-May against its US counterpart. Prices accelerated lower having struggled to find immediate downside follow-through after the government announced an NZ$1 billion housing fund."
• "From here, a daily close below the 0.7208-15 area (support shelf, 23.6% Fibonacci expansion) opens the door for a test of the 38.2% level at 0.7134. Alternatively, a push above the 0.7259-81 zone (former support, 14.6% Fib, trend line) paves the way for another challenge of the June 30 high at 0.7347."

[Sergey Golubev]

Crude Oil - ranging bearish; 49.88/50.72/51.66 resistance levels are the keys (based on the article)

Daily price is on bearish ranging within the following support/resistance levels:

• 49.88/50.72/51.66 resistance located in the beginning of the bullish reversal to be started, and
• 44.34 support located in beginning of the bearish trend to be resumed.

Descending triangle pattern was formed by the price to be crossed to below for the bearish trend to be continuing.

Most likely scenario for the daily price movement in the near future: ranging

• "The Secretary General of OPEC, Mohammad Barkindo, said today that the cartel he oversees, “has broken the ice in reaching out to shale producers in the U.S.” The announcement came as a surprise, since many have assumed that OPEC and shale producers are engaged in a prolonged battle in the oil market. Barkindo revealed that he and key shale oil producers met on the sidelines of this year’s World Petroleum Congress in Istanbul, Turkey."
• "He said the meeting was useful and productive. It is believed that the OPEC and the shale industry began talking in March at CERAWeek, an annual energy conference in Houston. Reports are that OPEC seeks further, more serious conversations with U.S. shale producers."

[Sergey Golubev]

Intra-Day Fundamentals - EUR/USD, GBP/USD and Dollar Index: Producer Price Index

2017-07-13 13:30 GMT | [USD - PPI]

• past data is 0.0%
• forecast data is 0.0%
• actual data is 0.1% according to the latest press release

if actual > forecast (or previous one) = good for currency (for USD in our case)

[USD - PPI] = Change in the price of finished goods and services sold by producers.

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From official report :

• "The Producer Price Index for final demand increased 0.1 percent in June, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices were unchanged in May and rose 0.5 percent in April. On an unadjusted basis, the final demand index advanced 2.0 percent for the 12 months ended in June."
• "In June, almost 80 percent of the rise in the final demand index is attributable to prices for final demand services, which increased 0.2 percent. The index for final demand goods edged up 0.1 percent."

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Dollar Index M5: range price movement by Producer Price Index news events

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EUR/USD M5: range price movement by Producer Price Index news events

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GBP/USD M5: range price movement by Producer Price Index news events

[Sergey Golubev]

USD/JPY - weekly bullish reversal; 114.17 is the key (based on the article)

Weekly price was bounced from 108.81 support level to above to be reversed to the primary bullish market condition: the price broke Ichimoku cloud together with 'reversal' Senkou Span lines to above with ascending triangle pattern to be testing together with 114.17 resistance level for the bullish trend to be continuing. Next nearest bullish targets are 115.50 and 118.65. Bullish breakout target for the long-term bullish trend to be established is 121.69.

Most likely scenario: price crosses 114.17 level to above for the ranging bullish to be started. 

• "USD/JPY had just forced an upside trendline break and the previous significant high – May 10’s 114.37 – was within striking distance. The Dollar got there alright, breaking in to the 114.40s on July 11, but victory was partial. It only managed to top that summit intraday, still hasn’t managed a higher daily close and has now retreated below. That channel neatly captures all the trading action from June 14’s low to the present day, but it may also offer something of a false positive. After all, the lower bound consists of precisely one intraday low, only about 48 hours old at the time of writing. The amount of reassurance this chart offers bulls must surely be limited."
• "The trendline below on the other hand passes through three intraday closing levels and two intraday lows. From that point of view, it looks more significant and, as you can see, USD/JPY broke below it this week. The pair is currently very close to support around 113.11. That was July 6’s close and a region around which which had coalesced around for the four previous days. There would also appear to be support around the 111.96 mark."

[Sergey Golubev]

Intra-Day Fundamentals - AUD/USD, USD/CNH and GOLD (XAU/USD): Retail Sales

2017-07-14 13:30 GMT | [USD - Retail Sales]

• past data is 0.1%
• forecast data is 0.1%
• actual data is -0.2% according to the latest press release

if actual > forecast (or previous one) = good for currency (for USD in our case)

[USD - Retail Sales] = Change in the total value of sales at the retail level.

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From CNBC article :

• "The Commerce Department said on Friday retail sales fell 0.2 percent last month, weighed down by declines in receipts at service stations, clothing stores and supermarkets. Americans also cut back on spending at restaurants and bars, as well as on hobbies."
• "May's retail sales were revised to show a 0.1 percent dip instead of the previously reported 0.3 percent drop. Retail sales rose 2.8 percent year-on-year in June."

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AUD/USD M5: range price movement by Retail Sales news events

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USD/CNH M5: range price movement by Retail Sales news events

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XAU/USD M5: range price movement by Retail Sales news events

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All the charts were made using Metatrader 5 with Brainwashing trading system:

Brainwashing system/AscTrend system (MT5) - the thread

[Sergey Golubev]

S&P 500 - Intra-day bullish breakout (based on the article)

H4 price is on bullish breakout by ascending triangle pattern to be breaking to above together with 2,456.94 resistance level to be testing for the bullish trend to be continuing.

• "There is no denying the longer-term trend is firmly higher, and finding ‘the’ top is not an exercise we are interested in partaking in. But even with that said, we could soon see another turn lower that offers shorter-term-minded traders an opportunity to take advantage of price weakness. The S&P is on approach to record highs at 2454. If we see a rejection around that level it could signal a move back towards 2405, continuing a range-trading environment, with an opportunity for shorts. If a move lower develops towards 2405 we would then become cautious on bearish bets and watch how the market responds to this important support level (it could also be in confluence with the December slope). There might be a long-trade in there as the range remains and buyers continue to keep the market propped up."
• "If, however, we were to see the 2405 level break, then it could be game-on for the bears, as we receive confirmation of the double-top. But not to get ahead of ourselves, we’ll first focus on the resistance level quickly approaching and go from there. If the S&P can gain traction through the record high on a daily closing basis, then the continued range scenario would be undermined. However, it wouldn’t necessarily be a sign that it is time to ‘get all bulled up’, as buying breakouts in equities has long had a history of burning those who paid up for new highs. Furthermore, there is a top-side trend-line extending from the March 1 high over the June high, as well as the under-side of a slope rising up from the November low. This could put a lid on the market, even if for just a short while."

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All the charts were made using Metatrader 5 with Brainwashing trading system:

Brainwashing system/AscTrend system (MT5) - the thread

[Sergey Golubev]

3 Big Mistakes And How To Correct Them (based on the article)

1. Looking for a breakout in all the wrong the places
2. Trading last year’s headlines today is comforting but ineffective
3. Do not ‘set it and forgetit,' stay nimble and keep checking the market’s vital signs to manage trades

[Sergey Golubev]

Weekly Outlook: 2017, July 16 - July 23 (based on the article)

The US dollar was on the back foot on political and mostly monetary issues. Is this just a setback or can we expect further falls? The upcoming week features a mix of events from all over the world.

1. Chinese GDP: Monday, 2:00. China is the world’s No. 2 economy. and demand from the economic giant has a huge impact on the rest of the world. Note that China also releases industrial output, fixed asset investment, and retail sales at the same time. Nevertheless, GDP has the upper hand.
2. UK inflation report: Tuesday, 8:30. The Bank of England has a lively debate about whether to raise rates or not. Headline CPI increased by 2.9% y/y and is expected to be seen again.
3. US housing data: Wednesday, 12:30. Building permits are expected to rise to 1.20 million and housing starts to 1.16 million.
4. Crude Oil inventories: Wednesday 14:30.
5. Australian jobs report: Thursday, 1:30. A more modest gain of 15.3K is projected and the unemployment rate is predicted to tick up to 5.6%.
6. Japanese rate decision: Thursday, during the Asian session, press conference at 6:30. While no change is expected in the policy driven by Kuroda, the updated assessment about the economy and especially inflation (remains very low), will be of interest.
7. ECB rate decision: Thursday, the decision at 11:45, press conference at 12:30. Any optimism about inflation and growth would be euro-positive, while a damp mood by the President of the Frankfurt-based institution would hurt the euro.
8. US Philly Fed Manufacturing Index: Thursday, 12:30. A slide to 23.8 is expected now. While the sector is small, it is still significant. Jobless claims are released at the same time but remain quite stable.

[Sergey Golubev]

Weekly EUR/USD Outlook: 2017, July 16 - July 23 (based on the article)

EUR/USD took another step forward, but could not hold onto the highs. What’s next? The big event on the agenda is undoubtedly the ECB meeting. Here is an outlook for the highlights of this week.

1. Final CPI: Tuesday, 9:00. According to the initial figures, the consumer price index rose by 1.3% y/y in June and core CPI advanced by 1.1%. Both figures were better than expected and both will likely be confirmed in the final read, even though Spain’s CPI was upgraded in its final read.
2. German ZEW Economic Sentiment: Tuesday, 9:00. The all-European figure printed 37.7 points.
3. German PPI: Thursday, 6:00.
4. Current Account: Thursday, 8:00. The figure stood at 22.2 billion in April and the number for April is due now.
5. Rate decision: Thursday, the decision at 11:45, press conference at 12:30. There, Draghi talked about a shift from deflation to reflation and mentioned a gradual removal of the stimulus. This time, no new forecasts are on the cards but reporters and markets would like to know if the ECB will announce the beginning of the end of its bond-buying scheme, currently set to expire by year-end. Any optimism about inflation and growth would be euro-positive, while a damp mood by the President of the Frankfurt-based institution would hurt the euro.
6. Consumer Confidence: Friday, 14:00.