Forex Analysis 2019.11.08

08-11-2019 09:17:21
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Forex Analysis: EUR/USD

Forex Analysis EUR/USD | November 08/11/2019 | sgtmarkets.com |

Euro zone economic growth is set to slow more than expected as the bloc’s manufacturing crisis could spill over to the larger services sector under protracted global trade tensions.

The U.S. economy created more jobs than Wall Street expected in October, in an unusual month affected by the strike by workers at General Motors. Nonfarm payrolls jumped 128,000, compared with expectations for a rise of 89,00.

The Federal Open Market Committee cut its fed funds rate to a range of 1.5% to 1.75% from a previous range of 1.75% to 2.00%. In the accompanying monetary policy statement, the Fed said economic activity had been rising at a “moderate” rate, though it pointed to “muted inflation pressures” as one the reasons for cutting rates.

We are Neutral from Bearish. Eyes on 1.11 Support level test. A confirmed breakout will lead down to 1.1055 important Demand Area. On the other hand, a confirmed breakout of 1.12 would quickly drag the price up to 1.1268, important Supply Area.

Our special Fibo Retracement is confirming the following S/R levels against the Monthly and Weekly Trendlines obtained by connecting the relevant highs and lows back to 2012:

Weekly Trend: Neutral
1st Resistance: 1.1100
2nd Resistance: 1.1268
1st Support: 1.1055
2nd Support: 1.0980

EUR

Recent Facts:

5th of December, Eurozone Services PMI
Better than Expected

14th of December, German Manufacturing PMI
Worse than Expected

17th of December, Eurozone CPI
Lower than Expected

4th of January, German Unemployment + CPI (Preliminary release)
German Unemployment Better than Expected, CPI ticked Lower than Expected

24th of January, German Manufacturing PMI
Worse than expected

21st of February, German Manufacturing PMI
Worse than expected

22nd of February, Eurozone CPI
As Expected

22nd of March, German Manufacturing PMI, Eurozone Manufacturing PMI
Worse than expected

28th of March, Spanish and German CPI data
Lower than expected

29th of March, German Job Market, Eurozone CPI (Preliminary)
Worse than expected

1st of April, German Manufacturing PMI
Worse than expected

1st of April, Eurozone CPI (Preliminary release)
Lower than expected

18th of April, German Manufacturing PMI
Worse than expected

30th of April, German Unemployment Change
Better than expected

3rd of May, Eurozone CPI (Inflation) data
Higher than expected

23rd of May, German Manufacturing PMI
Worse than expected

4th of June, CPI, Preliminary release
Lower than expected

5th of June, Services PMI
Better than expected

21st of June, German Manufacturing PMI
Better than expected

17th of July, CPI
Higher than expected

24th of July, German Manufacturing PMI
Worse than Expected

25th of July, ECB Interest Rate Statement
European Central Bank signaled a future cut in its official interest rates to new record lows

22nd of August, German Manufacturing PMI
Better than Expected

2nd of September, German Manufacturing PMI
Worse than expected

30th of September, German Unemployment Change and German CPI (Inflation data)
Better than Expected

16th of October, CPI
Lower than expected

24th of October, German Manufacturing PMI
Worse than expected

30th of October, German Unemployment Change
Worse than expected

USD

Recent Facts:

26th of September, Interest Rates Decision
The Federal Reserve raised interest rates by a quarter point (increased the overnight funds rate to a range of 2.00% to 2.25%) and removed its use of “accommodative”.

27th of September, Core PCE Prices + U.S. GDP Price Index
Higher than Expected

3rd of October, ADP Nonfarm Employment Change, ISM Non-Manufacturing PMI
Better than Expected

5th of September, U.S. Nonfarm Payrolls and Unemployment Change.
Nonfarm Payrolls Worse than expected, Unemployment Change Better than Expected

11th of October, CPI
Lower than expected

15th of October, Retail Sales
Worse than expected

2nd of November, U.S. Nonfarm Payrolls, Unemployment Rate
Better than Expected

14th of November, CPI
Lower than expected

28th of November, GDP
Worse than expected

7th of December, U.S. Nonfarm Payrolls and Unemployment Rate
Nonfarm Payrolls Worse than expected

14th of December, Retail Sales
Better than Expected

19th of December, Fed Meeting
The Federal Open Market Committee raised the fed funds rate 25 basis points but signalled Slower Pace of Hikes in 2019

21st of December, GDP
Worse than expected

1st of February, Nonfarm Payrolls, Unemployment Rate
Better than Expected

14th of February, Retail Sales
Worse than expected

28th of March, U.S. GDP data
Lower than expected

5th of April, Nonfarm Payrolls, Employment Change
Better than Expected

10th of April, Core CPI (Inflation)
Lower than expected

18th of April, Retail Sales
Better than Expected

26th of April, U.S. GDP data
U.S. GDP data up but U.S. Inflation still on the downbeat

1st of May: Fed FOMC Statement
U.S. Fed Chair Powell said the central bank’s current path of monetary policy was appropriate

3rd of May, Nonfarm Payrolls and Unemployment Rate
Better than Expected

3rd of May, ISM Non-Manufacturing Purchasing Managers Index (PMI)
Worse than Expected

10th of May, CPI
As Expected

15th of May, Retail Sales
Worse than Expected

30th of May, GDP
GDP data as expected but GDP Price Index continues its freefall

5th of June, ISM Non-Manufacturing PMI
Better than expected

7th of June, Nonfarm Payrolls
Worse than Expected

12th of June, CPI
Lower than Expected

19th of June, FOMC Statement
Dovish (Interest Rate cut imminent)

25th of June, CB Consumer Confidence
Lower than Expected

27th of June, GDP data
As Expected

5th of July, Nonfarm Payrolls and Unemployment Rate
Nonfarm payrolls Better than expected but Unemployment Rate ticked up

11th of July, Core CPI
Higher than expected

16th of July, U.S. Retail Sales data
Better than expected

24th of July, German and Eurozone Manufacturing PMI data
Worse than Expected

26th of July, GDP data
Better than expected

31st of July, German Unemployment
Better than expected

1st of August, ISM Manufacturing PMI
Worse than Expected

5th of September, ADP Nonfarm U.S. ISM Non-Manufacturing PMI
Better than Expected

13th of September, U.S. Retail Sales data
Better than Expected

1st of October, ISM Manufacturing PMI
Worse than Expected

2nd of October, ADP Nonfarm Employment Change
Worse than Expected

4th of October, Unemployment Rate
Better than Expected

30th of October, GDP
Better than Expected

30th of October, Interest Rate
The Federal Open Market Committee cut its fed funds rate to a range of 1.5% to 1.75% from a previous range of 1.75% to 2.00%

1st of November, Nonfarm Payrolls, Unemployment Rate
Better than Expected

 

Forex Analysis: GBP/USD

Forex Analysis GBP/USD | November 08/11/2019 | sgtmarkets.com |

The Bank of England left its key rate unchanged at 0.75% on Thursday, but two members of its monetary policy committee voted for a cut, the first time in over a year that the committee has been split. “Looking through Brexit-related volatility, underlying U.K. GDP growth has slowed materially this year and a small margin of excess supply has opened up,” the bank said in its statement. “That slowdown reflects weaker global growth, driven by trade protectionism, and the domestic impact of Brexit-related uncertainties.”

The Federal Open Market Committee cut its fed funds rate to a range of 1.5% to 1.75% from a previous range of 1.75% to 2.00%. In the accompanying monetary policy statement, the Fed said economic activity had been rising at a “moderate” rate, though it pointed to “muted inflation pressures” as one the reasons for cutting rates.

UK Prime Minister Boris Johnson called for a general election on Dec. 12 to break Britain’s Brexit impasse, conceding for the first time he will not meet his “do or die” deadline to leave the European Union next week. European Union Council President Donald Tusk confirmed that the EU has agreed to extend the deadline for Brexit until Jan. 31, 2020.

We are strongly Bullish. As we wrote in the previous commentaries, 1.2405 area tested on the downside a month ago and we thought that was a fake breakout. After a consolidation around that level, prices gained momentum up to our most important Resistance in area 1.2880. Now eyes to 1.3023 area. On the other hand, a confirmed breakout of 1.275 would mean re-test over 1.2590 Demand Area.

Our special Fibo Retracement is confirming the following S/R levels against the Monthly and Weekly Trendlines obtained by connecting the relevant highs and lows back to 2001:

Weekly Trend: Bullish
1st Resistance: 1.3000
2nd Resistance: 1.3023
1st Support: 1.2590
2nd Support: 1.2405

GBP

Recent Facts:

19th of February, Job Market
Worse than Expected

19th of March, Job Market
Contrasted

20th of March, CPI
Higher than Expected

21st of March, Retail Sales data
Better than Expected

29th of March, GDP
Better than Expected

2nd of April, Construction PMI
Worse than Expected

3rd of April, Services PMI
Worse than Expected

10th of April, GDP and Manufacturing Production
Better than Expected

17th of April, CPI
Lower than Expected

18th of April, Retail Sales
Better than Expected

1st of May, Manufacturing PMI
Worse than Expected

10th of May, Industrial Production and Trade Balance
Better than Expected

22nd of May, CPI
Lower than Expected

24th of May, Retail Sales
Better than Expected

4th of June, Construction PMI
Worse than Expected

10th of June, GDP data
Worse than Expected

2nd of July, Construction PMI
Worse than Expected (Lowest since 2009)

3rd of July, Services PMI
Worse than Expected

10th of July, Manufacturing Production data
Worse than Expected

16th of July, UK Job Market data
Worse than Expected

18th of July, Retail Sales
Better than Expected

5th of August, Services PMI
Better than Expected

9th of August, GDP data + Manufacturing Production
Worse than Expected

2nd of September, Manufacturing PMI
Worse than expected

9th of September, GDP and Manufacturing Production
Better than Expected

10th of September, Job Market
Better than Expected

18th of September, CPI
Lower than expected

19th of September, Retail Sales
Worse than expected

30th of September, GDP data
Higher than Expected

2nd of October, Construction PMI
Worse than expected

3rd of October, UK Services PMI data
Worse than expected

10th of October, GDP and Manufacturing Production data
GDP Better than Expected, Manufacturing Worse than expected

15th of October, Job Market
Better than Expected

15th of October, CPI
Lower than expected

7th of November, BoE Interest Rate Decision
Interest Rate Unchanged but two members of its monetary policy committee voted for a cut, the first time in over a year that the committee has been split

USD

See above.

 

Forex Analysis: AUD/USD

Forex Analysis AUD/USD | November 08/11/2019 | sgtmarkets.com |

Last Australia Retail Sales came again worse than expected.

“The main domestic uncertainty continues to be the outlook for consumption, with the sustained pending,” RBA governor Philip Lowe said. “Other sources of uncertainty include the effects of the drought and the evolution of the housing construction cycle”.

Official data showed China’s economic growth cooled to 6.2% in the second quarter, the weakest annual pace in at least 27 years, amid trade pressure from the United States. In the first half, the economy grew 6.3 percent compared with a year earlier.

We are Overbought. First target: 0.68. Second target if 0.68 will be relevantly violated on the downside: 0.67, important Demand Area.

Our special Fibo Retracements are confirming the following S/R levels against the Monthly and Weekly Trendlines obtained by connecting the relevant highs and lows back to 2012:

Weekly Trend: Overbought
1st Resistance: 0.6875
2nd Resistance: 0.6988
1st Support: 0.6710
2nd Support: 0.6630

AUD

Recent Facts:

6th of June, Australia GDP
Better than Expected

14th of June, Australia Job Market
Worse than Expected

4th of July, Australia Retail Sales
Slightly better than Expected

19th of July, Employment Change
Better than Expected

25th of July, CPI
Lower than Expected

1st of August, AIG Manufacturing Index
Worse than Expected

2nd of August, Retail Sales,
Better than Expected

16th of August, Employment Change
Worse than Expected

30th of August, HIA New Home Sales + Private New Capital Expenditure
Worse than Expected

12th of September, Westpac Consumer Sentiment
Worse than Expected

13th of September, Employment Change
Better than Expected

5th of October, Retail Sales
As Expected

18th of October, Job Market
Worse than Expected

30th of October, Building Approvals
Worse than Expected

31st of October, Australia CPI
Lower than Expected

1st of November, Australia Retail Sales
Worse than Expected

15th of November, Australia Employment Change
Better than Expected

29th of November, Australia New Home Sales + Private New Capital Expenditure
Worse than Expected

5th of December, GDP
Worse than Expected

11th of January, Retail Sales
Better than Expected

24th of January, Employment Change
Better than Expected

30th of January, CPI
Better than Expected

5th of February, Retail Sales
Worse than Expected

21st of February, Job Market
Better than Expected

21st of March, Job Market
Worse than Expected

3rd of March, Retail Sales
Better than Expected

18th of April, Job Market
Better than Expected

24th of April, CPI
Lower than expected

7th of May, Australia Retail Sales
Worse than Expected (weakest quarter in seven years)

13th of May, Home Loans
Worse than Expected

16th of May, Unemployment Rate
Higher than expected

4th of June, Retail Sales and RBA Interest Rate Statement
Retail Sales Worse than Expected, RBA cuts interest Rates as expected at 1.25%

5th of June, GDP
Worse than Expected

13th of June, Employment Change
Better than Expected

3rd of July, Australia Trade Balance and Building Approvals
Better than Expected

4th of July, Australia Retail Sales
Worse than Expected

18th of July, Job Market data
Worse than Expected

31st of July, CPI
Higher than Expected

2nd of August, Retail Sales data
Better than Expected

3rd of September, Retail sales
Worse than Expected

18th of September, job Market
Worse than Expected

17th of October, Employment Change
Worse than Expected

4th of November, Retail Sales
Worse than Expected

USD

Recent Facts:

See above.