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Dollar Support Kicks in as Market Risk Appetite Sinks

Trade war jitters return, weighing on the equity markets and commodity currencies, Trump’s 2nd general assembly speech tomorrow of little comfort.
Earlier in the Day:
There were no material stats released through the Asian session this morning, with China and Japan on holiday, leaving the markets to consider geo-political headwinds and key events and stats scheduled for the week, along with the rollout of tariffs on $200bn worth of Chinese goods later today.
At the time of writing, the Japanese Yen was flat at ¥112.59, pinned back by a stronger U.S Dollar, with the Aussie Dollar and the Kiwi Dollar also in the red, risk aversion at the start of the week hitting the pair as trade war jitters return to the markets ahead of Trump’s address to the General Assembly at the UN on Tuesday.
In the equity markets, the ASX200 was down 0.27%, with over half of the 200 listed in the red in at the start of the week, sliding mining and metals stocks doing the damage early on, an rally in crude oil prices providing little support. Things were not much better for the Hang Seng that opened down 1.07%, the shift in sentiment hitting the tech sector once more, with Tencent down 1.5% at the open, with bank stocks also seeing heavy losses early on.
The Day Ahead:
For the EUR, key stats scheduled for release are limited to August business sentiment numbers out of Germany. The Ifo Business Climate Index is forecasted to soften, with both the Business Expectations and Current Assessment numbers also forecasted to be on the softer side, which would be in line with recent stats out of Germany that have disappointed.
Outside of the numbers, ECB President Draghi is scheduled to speak this afternoon that could influence direction should any references be made to policy, Draghi having skirted the subject in speeches following the latest ECB press conference.
At the time of writing, the EUR was down 0.03% to $1.1745, with today’s stats and Draghi to provide some direction, while risk sentiment will likely be the key driver through the day.
For the Pound, it’s a quiet day on the data front, with stats limited to CBI Industrial Trend Order figures for September that are forecasted to be Sterling negative. While we can expect a reaction to the numbers, stats are likely to continue to be overshadowed by market sentiment towards Brexit, the British Prime Minister meeting the cabinet later today for the first time since last week’s Austrian debacle.
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2 Reply by xtreamforex.com (edited by xtreamforex.com 2018-10-02 12:04:55)

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Bitcoin Cash, Litecoin and Ripple Daily Analysis – 02/10/18

It’s positive start to the day, while Ripple’s XRP gives up some ground early, investors locking in profits from the September rally.
Bitcoin Cash Sees an Early Rally

Bitcoin Cash gained 0.83% on Monday, partially reversing Sunday’s 1.32% fall, to end the day at $535.7.
An early move through to an intraday high $544 was the only bullish move of the day, the day’s high coming up short of the first major resistance level at $550.7, before easing back. Holding on to $530 levels through the rest of the morning, Bitcoin Cash was hit by an early afternoon sell-off that saw Bitcoin Cash fall to an intraday low $519 before recovering to $530 levels, the day’s low steering clear of the first major support level at $514.6.
At the time of writing, Bitcoin Cash was up 2.68% to $547.5, a bullish start to the day seeing Bitcoin Cash rally through the first major resistance level at $550.7 to an early morning high $554.2 before easing back.
For the day ahead, a move back through to $550 levels would support a run at the day’s second major resistance level at $557.9 to bring $560 levels into play, though for any break through the second major resistance level, the news wires will need to be crypto friendly.
Failure to move back through to $550 levels could see Bitcoin Cash hit reverse later in the day, a fall through $533 bringing a morning low $528.7 into play, while we would expect Bitcoin Cash to steer clear of the first major support level at $521.8 barring materially negative news hitting the wires.Litecoin on the Move
Litecoin fell by 1.39% on Monday, following on from Sunday’s 0.6% loss, to end the day at $60.2, the fall marking a 4th consecutive day in the red and 8 days in the red out of the last 10.

Tracking the broader market, Litecoin fell from a start of a day intraday high $61.8 to an early afternoon intraday low $59.22 before finding support at the day’s first major support level at $59.57, Litecoin managing to break back through to $60 levels by the day’s end.

At the time of writing, Litecoin was up 1.36% to $61.04, with Litecoin recovering from an early morning low $59.91 to a morning high $61.3, the early moves leaving the major support and resistance levels untested.

For the day ahead, a move back through the morning high would bring the first major resistance level at $61.59 into play, with a hold on to $61 levels through to the early afternoon raising the prospects of a break back through to $62 levels later in the day before any pullback.Failure to hold on to $61 levels through the morning could see Litecoin give up the morning gains, a move back through $60.4 likely to bring sub-$60 levels and the day’s first major support level at $59.01 into play, any more material decline in the hands of the news wires on the day.
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USD/CNY: Trade War Turned into a Currency War and Escalates the Relationships Between the US and China

The US-China trade war has turned into a currency war. The latest manufacturing numbers released by China’s National Bureau of Statistics yesterday show the first hard evidence that US President Donald Trump has weakened Chinese President Xi Jinping’s hand in the nine-month-long trade war between the two economic superpowers. In the face of escalating US tariffs against Chinese goods, Chinese factory orders have declined after 15 months of expansion.
The news should excite currency traders who have sought to profit from increased volatility in the normally stable yuan this year. As a currency based on a fixed exchange rate controlled by the steady hand of the Chinese central bank, the Yuan has not heretofore received a lot of attention from traders. But traders should be aware that China has drawn a currency weapon to help prop up the Yuan.
The USD/CNY fell slightly to 6.8688 in early morning European trading but is still stable. The small bounce up seemed like a tepid response to evidence the US trade tactics are taking a toll on China’s manufacturing sector. But traders should take into account a heavier government price setting hand when estimating Yuan price moves.

In September, the South China Morning Post reported that the People’s Bank of China (PBOC) has reintroduced the ‘counter-cyclical factor mechanism’—described as a ‘black box’ used by market makers when setting the Yuan fixed exchange rate to protect against depreciation. Typically, the fixed rate is determined based on the previous day’s close and overnight changes in the basket of currencies the Yuan tracks. This rate is allowed to fluctuate up to 2 percent in the forex markets. Just before the trade war began in January, as the Yuan stabilized, China had withdrawn the mechanism but as the trade war puts downward pressure on the Yuan, the PBOC has decided to reinstate it.
For many market observers, such Chinese government interference to prop up its currency has turned the trade war into a currency war. For traders, trading on the news alone without taking the additional fixing mechanism into account could lead to overestimations of price movements in the Yuan.
Though when the US markets open, a more enthusiastic response to the decline in Chinese exports and manufacturing in the ongoing trade wars is expected. After 15 months of expansion and eight months after President Donald Trump started imposing tariffs on Chinese goods, China’s factory orders have slowed. The Purchasing Managers’ Index (PMI) for September declined to 50.8 from 51.3 in August. Officially, the 50-mark would indicate a contraction. Growth in new export orders, meanwhile, declined for the fourth consecutive month to 48.0 from 49.4 in August. Companies attribute the slowdown in exports to the US trade tariffs, according to the Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI), which reported a similar decline in September orders.
The currency war is now expected to escalate the trade war. President Trump has threatened China with more tariffs if it engaged in manipulation of the Yuan. In July and August, the USD was strengthening against the Yuan, which no doubt triggered China’s decision to reintroduce the counter-cyclical mechanism. Additionally, China is lowering taxes and fees to increase business competitiveness. The Services sector performed better, increasing from 54 to 54.9.
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Why do Professional Traders Use Demo Accounts

Demo accounts are known to be a new comers tool for practice. All new traders need to practice and get the hang of trading and using a platform before risking their own money. But new traders are not the only ones who open demo accounts, many experienced and professional traders still use demo accounts frequently.
Just because someone is experienced in trading and invests a lot of money does not mean he does not take money spending seriously. In fact it is the opposite, real investors understand the value of money and the importance of organizing spending patterns.
So when experienced traders consider working with a new company, they need to check the company’s platform, tools, execution orders and services before investing their money. Demo accounts are just the way to do that. For experienced traders it is easier to spot the advantages of a company within a small period and a Demo account will allow them to make the choice of whether to invest in this company or not.
Another common reason why experienced traders open demo accounts, sometimes with the company they are already trading with, is to test out new strategies.
Many professional traders combine and implement new strategies all the time in order to find better ways of increasing their profits. If traders would invest their money every time they try out a new strategy they would probably suffer a lot of losses. A demo account is a safe place for trial and error, and for developing the right strategy or combination of strategies to trade better.
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