Brent Crude Oil: general review

2019-05-21 09:04 (GMT+2) Brent

Current trend

Brent crude oil is traded in an upward channel with a resistance level at 73.60 and support level at 70.30.

Significant demand for "black gold" is provided by the possibility of new attacks on oil facilities in Saudi Arabia. The second positive moment for the energy market is the decision of OPEC to adhere to a balanced market and not to increase current production. At the same time, representatives of the organization said they would focus on demand and monitor global reserves in order to be able to influence the situation in a timely manner. Under the current agreement, the countries of the oil cartel have agreed to reduce total production by 1.2M barrels per day. It is also worth noting that last week a report on drilling activity in the United States was published, showing that the number of active oil rigs fell from 805 to 802 units in a week. The slowdown of this indicator indicates a possible decrease in production growth in the United States: over the past two weeks, the rate of oil refining fell by 100K barrels per day. At the same time, in Canada the activity indicator remained at the same level: the number of drilling rigs was 22 units.

Support and resistance

Stochastic is at 35 points and does not provide any signals for the opening of transactions.
Resistance levels: 73.60, 74.50.
Support levels: 72.00, 71.20.

Trading tips

Open long positions after the breakout of 73.60 with take profit at 74.50 and stop loss at 73.25.

EUR/USD: general review

2019-05-28 08:33 (GMT+2) EUR/USD

Current trend

At the end of last week, EUR strengthened against USD amid weak macroeconomic releases from the US. Negative data heightened investor concerns about the growing tensions between the US and China, which threaten the growth of the American economy.

At the same time, EUR is still holding back from falling, despite the fact that the European Commission may in the near future fine Italy by 0.2% of GDP (about EUR 3.5 billion) due to the exceeded level of public debt. At the same time, EUR received moderate support from the results of European Parliament elections, where pro-European parties retained a majority.

Today at 10:00 (GMT+2), statistics on Private Sector Loans in the euro area is expected to be published, and at 11:00 (GMT+2), the results of the Business and Consumer Survey in the euro area will be published. In the afternoon, statistics on House Price Index (15:00 GMT+2) and CB Consumer Confidence in the US (16:00 GMT+2) are scheduled to be released. The recent fall in the stock market may adversely affect the confidence of American consumers, which will help strengthen the pair.

Support and resistance

On the H4 chart, the instrument is trading below the center line of Bollinger Bands. The indicator is directed upwards and the price range is reduced, which indicates the change of the downtrend. MACD histogram is in the positive zone keeping a weak buy signal. Stochastic is leaving the oversold zone having formed a buy signal.

Resistance levels: 1.1201, 1.1223, 1.1247, 1.1264.
Support levels: 1.1180, 1.1160, 1.1143, 1.1127, 1.1111.

Trading tips

Long positions may be opened from the current level with target at 1.1225 and stop loss at 1.1165.
Short positions may be opened below 1.1165 with target at 1.1110 and stop loss at 1.1185.
Implementation time: 1-2 days.

2019-05-30 07:34 EUR/JPY

EUR/JPY: Ichimoku clouds

Let's look at the four-hour chart. Tenkan-sen line is below Kijun-sen, the red line is directed downwards, while the blue one remains horizontal. Confirmative line Chikou Span is below the price chart, current cloud is descending. The instrument is trading between Tenkan-sen and Kijun-sen lines. One of the previous minimums of Chikou Span line is expected to be a support level (121.76). The closest resistance level is the upper border of the cloud (122.69).

On the daily chart Tenkan-sen line is below Kijun-sen, the blue line is directed downwards, while the red one remains horizontal. Confirmative line Chikou Span is below the price chart, current cloud is descending. The instrument is trading below Tenkan-sen and Kijun-sen lines; the Bearish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (121.76). The closest resistance level is Tenkan-sen line (122.63).

Recommendation

On the four-hour chart we can see a correction of the downward movement. On the daily chart the Bearish trend is still strong. It is recommended to open short positions at current price with Take Profit at the level of previous minimum of Chikou Span line (121.76) and Stop Loss at the level of Kijun-sen line (122.63).

Morning Market Review
2019-06-03 08:52 (GMT+2)

EUR/USD

EUR is actively recovering against USD after updating local lows on May 30. Technical factors contribute to the development of "bullish" dynamics, while the fundamental background for the euro remains very ambiguous. Investors fear the development of a political crisis in Italy, as well as watching the development of trade relations between the EU and the US, which have worsened after the harsh statements by Donald Trump. Published on Friday, macroeconomic indicators from Europe failed to provide significant support to the euro. Retail Sales in Germany in April decreased by 2.0% MoM, but unexpectedly increased strongly in annual terms (+4.0% YoY). German CPI in May slowed from +1.0% MoM to +0.2% MoM, which turned out to be worse than the average market expectations. Meanwhile, HCPI slowed down from +2.1% YoY to 1.3% YoY over the same period.

GBP/USD

GBP is trading higher against USD at the beginning of the new week, developing a correctional impulse formed at the end of the last trading week. On Friday, macroeconomic statistics on consumer lending published in the UK provided moderate support for the instrument. Net Lending to Individuals in April rose from 4.7B to 5.2B pounds, while the forecast predicted its decline to 4.6B. Mortgage Approvals in April rose from 62.56K to 66.26K, which also exceeded the market expectations (63.25K). Investors are focused on statistics on May PMI in the UK. The current forecast of analysts suggests a decrease in Markit Manufacturing PMI from 53.1 to 52.0 points.

AUD/USD

AUD is strengthening against USD during today's Asian session, updating local highs of May 13. Corrective sentiment on the US currency contributes to the development of upward dynamics on the instrument, while the macroeconomic background from Australia remains ambiguous. AiG Manufacturing index went down from 54.8 to 52.7 points in May. Company Gross Operating Profits in Q1 2019 grew by 1.7% QoQ only, which is almost twice as bad as market expectations. ANZ Job Advertisements in May showed a sharp decline of 8.4% MoM after rising by 0.2% MoM last month. On Tuesday, investors are waiting for the RBA decision on the interest rate, which is expected to be reduced from 1.50% to 1.25%. In the case of the implementation of forecasts, AUD may fall under pressure.

USD/JPY

USD fell sharply against JPY on May 31, updating local lows of mid-January. The reason for the emergence of negative dynamics in the instrument was the statements by US President Donald Trump's about his intention to sharply increase import duties on Mexican goods, if Mexico does not take measures aimed at restricting the flow of migrants. Investors fear that the implementation of Trump’s threats could have a significant impact on the US economy and exacerbate the threat of a recession, given the large trade turnover between the countries. Meanwhile, JPY is under pressure from a not too optimistic macroeconomic background from Japan. Friday statistics reflected a slowdown in growth in Retail Sales in April from +0.2% MoM to 0.0% MoM. YoY, the indicator slowed from +1.0% to +0.5%. May data released today on the Nikkei Manufacturing PMI in Japan showed an increase from 49.6 to 49.8 points, while analysts did not predict a change in this indicator.

Oil

Oil prices dropped markedly at the end of last week, updating local lows of mid-February. The reason for such a sharp decline of the instrument was the growing fears about global demand after statements by US President Donald Trump about the intention to increase import duties on all Mexican goods, if Mexico does not restrict the flow of illegal migrants. The opening of the new front in the US trade war serves as a source of uncertainty and threatens with the negative consequences for the world economy. Moreover, the American economy may also be significantly affected, since the trade turnover between the United States and Mexico is still very high. In addition to imports of agricultural products, the United States is actively importing oil from Mexico, so the current situation threatens with an additional decrease in demand.

Morning Market Review
2019-06-05 08:50 (GMT+2)
EUR/USD

EUR rose significantly against the US dollar on Tuesday, updating local highs of April 18. The growth of the euro is still promoted by the correction factors of the US dollar, which appeared after the new threats of Donald Trump to introduce import duties against Mexico. Analysts have again spoken about the risks to the US economy that these and similar restrictive measures bear. Also, USD is under pressure from the Fed policy, which may return to lower interest rates in the event of further deterioration in economic indicators. At the same time, the market is characterized by a rather low investor interest in risk. Published on Tuesday, macroeconomic statistics from the euro area prevented the emergence of a more confident uptrend in the instrument. CPI slowed down in May from +1.7% YoY to +1.2% YoY, which turned out to be worse than expectations. Core CPI for the same period corrected from +1.3% YoY to +0.8% YoY with the forecast of +0.9% YoY.

GBP/USD

GBP maintains an upward trend paired with USD, noting the new local highs of May 27. Published on Tuesday, the macroeconomic statistics from the UK was negative, but there was no significant pressure on the pound. The UK Construction PMI fell sharply in May from 50.5 to 48.6 points, while the forecast did not suggest any changes in the indicator. BRC Retail Sales Monitor in May also showed a decline of 3.0% YoY after rising by 3.7% YoY last month. Analysts expected an increase of +0.9% YoY. GBP is under additional pressure by the deadlock around Brexit. Teresa May did not manage to reach an agreement within the Parliament, which forced her to resign from the post of the Conservative Party leader. Perhaps the new Prime Minister will be able to find other ways for dialogue, but investors fear that the process may be delayed. Only the selection of a new party leader can take more than a month.

AUD/USD

AUD continues to grow moderately against AUD, updating the highs of 10 May. The growth of the instrument proceeds against the background of the publication of not the most confident macroeconomic statistics from Australia, as well as yesterday's decision of the RBA to lower the interest rate to 1.25% for the first time in 3 years. However, the decision of the regulator was quite predictable, and therefore the pressure on the Australian dollar was moderate. In the follow-up statement, the RBA noted that it is trying to maintain employment and inflation levels that remain below target levels. Moreover, RBA officials did not rule out further steps to ease monetary policy. Investors today are focused on the preliminary statistics on Australia's GDP for Q1 2019. On a quarterly basis, the economy accelerated from +0.2% QoQ to +0.4% QoQ, which was slightly below the forecast of +0.5% QoQ. YoY, the growth of the index slowed down from +2.3% to +1.8%.

USD/JPY

USD is consolidating against JPY after active decline at the end of the last trading week. The yen is supported by a low investor interest in risk, as well as corrective sentiment on the US currency. However, the activity on the instrument remains quite low. Nikkei Services PMI exerts some pressure on JPY on Wednesday. In May, according to preliminary estimates, the figure dropped from 51.8 to 51.7 points, with a forecast of growth to 51.9 points. On Thursday, markets are expecting the speech of the head of the Bank of Japan, Haruhiko Kuroda, who may reveal the regulator’s plans for monetary policy in the near future.

Oil

Oil prices are correcting after a steady decline at the end of the last trading week. The growth of quotations is largely technical in nature, while negative factors only intensify. In particular, it became known that Russia opposes further restrictions on oil production under the OPEC+ deal. The report of the American Petroleum Institute reflected the growth of oil reserves for the week as of May 31 by 3.545 million barrels after a decrease of 5.265 million barrels for the previous period. On Wednesday, investors expect to publish similar statistics from the US Department of Energy.

Morning Market Review
2019-06-07 08:44 (GMT+2)
EUR/USD

EUR showed strong growth against USD on Thursday, recovering from a corrective decline of the previous day. The reason for the emergence of the uptrend was another weakening of USD against the background of the publication of not the most optimistic macroeconomic statistics from the United States and the growth of trade tensions between the countries. On Wednesday, the ADP Nonfarm Employment Change reflected a sharp slowdown in job growth from 275K to 27K, which turned out to be drastically worse than forecasts (180K). Thursday's data indicated a decline in Nonfarm Productivity in Q1 2019 from 3.6% to 3.4%, with a forecast of 3.5%. Unit Labor Costs for the same period declined by 1.6% after the decline of 0.9% in the previous period. European statistics was more predictable, which provided moderate support for the euro. Euro area's GDP for Q1 2019 showed an increase of 0.4% QoQ and 1.2% YoY, which fully coincided with the forecasts. The ECB kept the interest rate at 0%, noting that its growth is possible not earlier than the first half of 2020.

GBP/USD

GBP is trading flat against USD, remaining close to local highs, updated on Thursday. Despite the publication of weak statistics from the US, the pound was not able to consolidate in the uptrend, being under pressure from uncertain prospects around Brexit. On Thursday, investors were focused on the speech of the Bank of England governor Mark Carney, who is currently on a visit to Japan. The speech of the head of the regulator did not render any long-term support to the instrument, since it was largely devoted to the problems of investment funds. At the end of the week, investors expect the publication of Halifax UK House Price Index, as well as the release of an updated consumer inflation forecast. The May report on the US labor market will be more interesting.

AUD/USD

AUD showed a slight increase against USD on Thursday, weakening the downward corrective impulse formed the day before. During the Asian session, the instrument is again prone to decline, yet investors prefer to wait for the appearance of new drivers in the market. Friday's statistics from Australia was rather weak. AiG Construction Index went down from 42.6 to 40.4 points in May. Home Loans in April decreased by 1.2% after a decline of 2.5% in March. Analysts expected a decline of only 0.2%. Investment Lending for Homes in April showed a decrease of 2.2% after a decline of 2.7% in March.

USD/JPY

USD showed ambiguous dynamics against JPY, ending yesterday’s trading session with a slight decrease. Pressure on USD was exerted by weak macroeconomic data from the United States published on Thursday. In addition, investors are cautiously waiting for the release of the May report on the US labor market, because according to the previously published ADP report, the real state of the market may be significantly worse than expectations. In turn, the yen continues to receive moderate support from the risks of developing US trade conflicts with China and Mexico and a possible interest rate cut by the Fed in the foreseeable future. The process of negotiations between the US and Mexico has not yet brought visible success, but the market as a whole is quite optimistic and expects that on June 10, import duties on Mexican goods will not be introduced.

Oil

Oil prices rose significantly on Thursday, departing from local lows of January 29, updated the day before. The growth of the instrument was largely technical in nature, whereas the former negative factors are still very strong. In particular, the market fears further decline in global demand amid a slowing global economy. A previously published report from the US Department of Energy also put strong pressure on quotes, reflecting an increase in oil production rates and indicating a sharp increase in inventories. On Friday, investors are focused on the May report on the US labor market. In addition, investors are waiting for Baker Hughes US Oil Rig Count.

Morning Market Review
2019-06-11 08:42 (GMT+2)
EUR/USD

EUR showed a slight decrease against USD on Monday, correcting after a strong growth of the instrument at the end of last week, when the euro updated local highs of March 22. The development of the "bearish" dynamics was due to the strengthening of USD in response to progress in the US-Mexico trade negotiations. Under the influence of a rather tough ultimatum on the part of Donald Trump, Mexico announced a number of measures against illegal migration, which ultimately made it possible to avoid an increase in import duties. Analysts are optimistic about this news, because they extrapolate this experience with Mexico to a situation with China, where a compromise has not yet been reached. Earlier, Donald Trump noted that he plans to discuss trade relations with Xi Jinping at the sites of the G20 Summit, which will be held on June 28 in Osaka.

GBP/USD

GBP showed active decline against USD on Monday, almost completely offsetting the strong growth of the end of last week. Significant pressure on GBP was put by weak macroeconomic statistics from the UK. Industrial production in April decreased sharply by 2.7% MoM and 1.0% YoY after the increase by 0.7% MoM and 1.3% YoY. Analysts counted on –0.7% MoM and +1.0% YoY. During the same period, Manufacturing Production decreased by 3.9% MoM and 0.8% YoY, which also turned out to be significantly worse than forecasts (–1.1% MoM and +2.2% YoY). Index of Services in April showed an increase of 0.2% QoQ, slowing down from the previous +0.3% QoQ. GDP in April showed a sharp decline of 0.4% MoM after a decrease of 0.1% MoM in March. During the Asian session on June 11, the instrument shows flat trading, and investors are awaiting publication of data on the UK labor market.

AUD/USD

AUD dropped significantly against USD at the beginning of this week, departing from its local highs. Australian markets were closed on Monday due to the national holiday, so the focus was on the optimistic news about the signing of an agreement between the US and Mexico, which allowed to avoid a new trade war. Some support for AUD on Monday is provided by news from China. Exports in May showed an increase of 1.1% YoY after a decrease of 2.7% YoY last month. Analysts counted on aggravating negative dynamics and reducing the index by 3.8% YoY. Imports, in contrast, fell sharply by 8.5% YoY after rising by 4.0% YoY in April. All this led to a sharp increase in the trade surplus, which reached USD 41.65 billion in May against the previous value of USD 13.84 billion.

USD/JPY

USD showed ambiguous dynamics against JPY on Monday, ending the day session with almost zero result. The dollar was supported by optimistic news about the signing of an agreement between the USA and Mexico, which made it possible to avoid imposing import duties on Mexican goods from June 10. Investors also hoped that the US would be able to make some progress in trade negotiations with China. In turn, the yen received strong support from macroeconomic publications from Japan. Japan's GDP in Q1 2019 showed an increase of 0.6% QoQ after a growth of 0.5% QoQ over the previous period. In annual terms, the growth of the Japanese economy in Q1 2019 reached +2.2% YoY after rising by 2.1% YoY in the previous period.

Oil

Oil prices returned to decline on Monday, retreating from the new local highs of the beginning of the month. Pressure on the instrument is exerted by Russia's uncertain position on the issue of extending the current OPEC+ deal, which ends at the end of the month. A negative factor is still the low demand for petroleum products against the backdrop of a slowdown in the global economy. Trade tensions between the US and China have not gone away, and after the G20 Summit at the end of the month, a new round of increase in duties is quite possible if the parties do not reach any agreement. Today, investors are focused on API Weekly Crude Oil Stock. The previous report reflected increase in volumes of 3.545M barrels.

Morning Market Review
2019-06-13 08:51 (GMT+2)
EUR/USD

EUR showed a steady decline against USD on Wednesday, departing from local highs of March 22, updated late last week. The reduction of the instrument was largely technical in nature, while the news background did not change much. EUR was under pressure after the speech by the head of the European Central Bank Mario Draghi, who focused on the vulnerability of the Central European countries to new threats of global trade war. With the opening of the American session, investors focused on the statistics on consumer inflation from the US. In May, CPI showed an increase of 0.1% MoM and 1.8% YoY, slowing from the previous +0.3% MoM and +2.0% YoY. Core CPI showed an increase of 0.1% MoM and 2.0% YoY, which was slightly worse than market expectations. During the Asian session on June 13, the instrument is trading in both directions, waiting for new drivers to appear at the market. The focus is on the German statistics on consumer inflation in May, as well as the dynamics of industrial production in the euro area in April.

GBP/USD

GBP continues trading in both directions against USD. On Wednesday, the instrument returned to decline, despite the publication of weak statistics on consumer inflation from the US. GBP remains under pressure from an uncertain position on Brexit and weak macroeconomic statistics from the UK. Market participants fear that the new Prime Minister may destroy all the fragile agreements that Theresa May has been able to reach with the EU, and will eventually choose Brexit without a deal. In particular, one of the candidates for the post of Prime Minister, Boris Johnson, does not exclude such an option. At the same time, British Treasury Secretary Philip Hammond said earlier that the UK’s exit from the EU on October 31 is an almost impossible task.

AUD/USD

AUD showed a steady decline against USD on Wednesday, responding to the overall strengthening of USD across the entire market. The US dollar is growing despite the publication of disappointing statistics on the US consumer inflation, which has heightened fears of a speedy reduction in the interest rate by the Fed. During the Asian session on June 13, the instrument is trading downwards. At the same time, AUD is supported by a moderately optimistic report on the labor market in Australia in May. The level of employment in May grew by 42.3K workplaces against 28.4K last month. Analysts expected a growth of only 17.5K. Participation Rate in May reached 66.0%, while the forecast assumed that the figure would remain unchanged at 65.8%. At the same time, the Unemployment Rate in May remained at the previous level of 5.2%, while experts counted on reducing it to 5.1%.

USD/JPY

USD was almost unchanged paired with JPY on Wednesday. The market almost ignored the publication of a weak report on US consumer inflation, while the demand for yen remained quite low amid growing interest in risk. In turn, yesterday's macroeconomic statistics released in Japan managed to provide slight support to JPY. Japanese Core Machinery Orders in April increased by 5.2% MoM and 2.5% YoY, which was significantly better than the forecast of –0.8% MoM and –5.3% YoY. During today's Asian session, statistics from Japan provide support to the yen. Tertiary Industry Activity Index in May showed an increase of 0.8% YoY after a decrease of 0.4% YoY last month.

Oil

Oil prices declined significantly during Wednesday trading, reacting to the disappointing statistics on stocks from the US Department of Energy. According to the data, the volume of oil and petroleum products in the United States for the week as of June 7 rose by 2.206 million barrels after rising by 6.771 million barrels for the previous period. Analysts had expected a decline in stocks of 0.481 million barrels. Production volumes in the United States during the reporting period decreased from 12.400 to 12.300 million barrels per day. The report also pointed to lower forecasts for growth in demand for oil for the second half of 2019. In turn, the quotes are supported by the expectation of an extension of the OPEC+ deal on limiting oil production. In addition, investors are optimistic about the development of the US-Chinese trade conflict and expect positive changes after the G20 summit, which will take place in late June.

Morning Market Review
2019-06-17 08:43 (GMT+2)
EUR/USD

EUR showed a decline against USD on Friday, retreating to local lows of June 6. The reason for the appearance of the "bearish" dynamics of the instrument was the strong macroeconomic statistics from the United States, as well as the general corrective sentiment at the market. The volume of industrial production in the US in May increased by 0.4% MoM after a decline of 0.4% MoM last month. Analysts had expected positive trend to recover, but counted on 0.2% MoM growth. Capacity Utilization Rate in May rose from 77.9% to 78.1%, which turned out to be better than the market forecast of 78.0%. Statistics from the euro area published on Friday turned out to be noticeably worse. France Harmonized Index of Consumer Prices slowed down in May from +0.3% MoM to +0.1% MoM, and from +1.3% YoY to +0.9% YoY. In Italy, the volume of industrial orders fell sharply. In April, the indicator fell by 2.4% MoM after rising by 2.1% MoM in the previous month. Analysts had expected growth by +2.4% MoM.

GBP/USD

GBP returned to an active decline against USD at the end of the last trading week, updating local lows of May 31. The negative dynamics of the instrument is taking place against the background of further growing uncertainty in the market, which forces investors to look for safer assets. At the same time, concerns about a rate cut by the US Fed have now faded into insignificance, since the market has partially involved this scenario in current quotes. The speech of the Bank of England Governor Mark Carney on Friday did not provide any support for GBP, since it was not devoted to the prospects of monetary policy. Brexit remains a powerful negative factor for the instrument, as well as the election of a new British Prime Minister. Markets fear that the UK will leave the EU without a deal, which will cause more harm to the national economy.

AUD/USD

AUD showed a decline against USD on Friday, having updated local lows of the beginning of 2019. The development of negative dynamics of the instrument on Friday was due to strong macroeconomic statistics from the US, coupled with increased uncertainty in the market. Macroeconomic statistics from China also put certain pressure on the instrument. Industrial Production in May slowed down from +5.4% to +5.0% YoY, while analysts predicted growth of the rate to +5.5% YoY. Fixed Asset Investment decreased from +6.1% YoY to +5.6% YoY, which also turned out to be worse than forecast of 6.1%. During the Asian session on June 17, the instrument is trading ambiguously, waiting for new drivers to appear at the market. The macroeconomic background is relatively poor today, so an increase in volatility is expected from Tuesday, when the minutes of the RBA meeting will be published.

USD/JPY

USD showed a slight increase against JPY on Friday, but still maintains the flat corridor, which has existed since June 3. Support for the US currency is provided by strong macroeconomic data from the US, as well as a reduction in concerns about the development of a recession in the US economy. Published on Friday, statistics from Japan could not provide any substantial support to JPY. Industrial production in Japan in April showed an increase of 0.6% MoM and decreased by 1.1% YoY. The data coincided with forecasts and with the dynamics of last month. Capacity Utilization in April increased by 1.6% MoM after the decline by 0.4% MoM in the previous month. Experts expected a growth of +0.2% MoM.

Oil

Oil prices showed a moderate increase on Friday, continuing the development of a corrective impulse. Technical factors contributed to the development of "bullish" dynamics of the instrument, while the former negative background remained. Last week, the International Energy Agency lowered its demand forecast for the current year by 100K barrels to 1.2M barrels per day. A similar forecast was published by OPEC, lowering the forecast of demand to 1.14M barrels per day. The quotes are still supported by growing tensions in the Middle East: last week two tankers were attacked in the Gulf of Oman. The US has already blamed Iran for these attacks, which could lead to a new round of sanctions pressure on Tehran.

Morning Market Review
2019-06-19 08:38 (GMT+2)
EUR/USD

The euro showed a noticeable decline against the US dollar on Tuesday, updating local lows of June 3. The reason for the resumption of active "bearish" dynamics was the speech of the ECB President Mario Draghi, who did not rule out the use of broad incentives if the economic situation continues to deteriorate. He was talking about both additional interest rate cuts and expansion of the quantitative easing program. The published macroeconomic statistics from Europe also did not support EUR. Investors were greatly disappointed with the statistics on the ZEW economic sentiment index in Germany. In June, the indicator dropped sharply from -2.1 to -21.1 points, with a forecast of a decline to -5.9 points. In the Eurozone, the index fell from -18.6 to -20.2 points. The Eurozone consumer price index in May showed an increase of 0.1% MoM and 1.2% YoY, slowing down from the previous 0.7% MoM and 1.7% YoY.

GBP/USD

The British pound showed moderate growth against the US dollar on June 18, which allowed it to partially win back Monday's losses. However, the pound managed to update the local minima of January 3, since the position of the US currency continues to be quite strong. The main driver for GBP growth were technical factors, while there was no interesting macroeconomic statistics from the UK. The speech of the head of the Bank of England, Mark Carney, also failed to provide significant support to the instrument, since it did not concern the monetary policy outlook. On Thursday, the BoE will publish its decision on rates. Analysts believe that the decision to maintain rates at the current level will be taken unanimously.

AUD/USD

The Australian dollar strengthened against the US dollar on Tuesday, recovering from a 6-day "bearish" rally. The instrument was supported by the rise in correction sentiment in anticipation of the Fed meeting on Wednesday, as the market fears a quick decline in interest rates in USA. In addition, the demand for the Australian dollar has increased after the optimistic Donald Trump publications on Twitter, where he announced his meeting with PRC President Xi Jinping at the G20 summit. Today, the instrument is traded in both directions. AUD is slightly pressured by statistics from Australia. The Westpac index of leading economic indicators in May showed a decline of 0.1% MoM while maintaining a negative trend.

USD/JPY

The US dollar showed a noticeable decline against the Japanese yen on June 18 but managed to recover by the close of the day session. The instrument was supported by optimistic comments from Donald Trump on Twitter, which announced a meeting with PRC leader Xi Jinping at the G20 summit. The US and Chinese teams should start meeting in the near future to discuss the trade conflict. Today, the instrument is trading in both directions, and investors expect new drivers and a significant increase in volatility at the end of the week. The Fed meeting will take place on Wednesday, and on Thursday, the Bank of Japan and the Bank of England will meet, too. On Wednesday, the yen is pressured by the statistics from Japan. Exports in May collapsed by 7.8% YoY after falling by 2.4% YoY last month. Imports decreased from 6.5% YoY to -1.5% YoY with a forecast of 0.2% YoY. In May, Japan’s trade balance was again in deficit of -967.1 billion yen.

Oil

Oil prices rose on Tuesday after US President Donald Trump announced a meeting with Chinese Chairman Xi Jinping at the G20 summit in late June. Investors are still hoping for a favorable resolution of the trade conflict, which significantly increases the risks in the market. Some support for quotes was provided by API report on oil reserves. For the week of June 14, oil reserves fell by 0.812 million barrels after rising by 4.850 million over the previous period. On Wednesday, investors will focus on the Fed's interest rate decision with an accompanying press conference, as well as the publication of a report on oil reserves from the US Department of Energy.

Morning Market Review
2019-06-24 08:44 (GMT+2)
EUR/USD

The euro showed a sharp rise against the US dollar on Friday, updating local highs of March 22. The reason for the further weakening of the US currency is the decline in the yield of treasury bonds, the pigeon position of the Fed, and the growing risks of currency interventions in addition to lowering the interest rate. The euro was supported by macroeconomic statistics published at the end of the week. In June, according to preliminary estimates, the composite Markit Manufacturing PMI showed an increase from 51.8 to 52.1 points with a "no change" forecast. Markit Services PMI for the same period increased from 52.9 to 53.4 points, which is also above expectations. In turn, US indices showed a decline. Markit Manufacturing PMI fell from 50.5 to 50.1 points while the forecast was 50.4 points. Services PMI dropped from 50.9 to 50.7 points, with a forecast of growth to 51.0 points.

GBP/USD

The British pound is trading upwards against the US currency, updating local highs of June 12. The instrument is supported by the weak dollar position, which expects monetary policy easing at the Fed meeting in July. Also, investors are waiting for the start of the G20 summit at the end of the week and are hoping for positive results from a possible meeting between US President Donald Trump and Chinese leader Xi Jinping. In turn, the pound is pressured by the increased uncertainty around Brexit. Last week, the head of the European Council, Donald Tusk, noted that he was looking forward to working with the new British Prime Minister, but stressed that the agreements reached under the agreement are not subject to revision. This is a rather alarming signal since practically all candidates for the post of prime minister in one way or another support the revision of certain points of the agreement. The alternative is still the "no deal" Brexit.

AUD/USD

The Australian dollar showed ambiguous dynamics against the US dollar on June 21, but today it is actively growing again. The strengthening of the instrument is largely due to technical factors, while the macroeconomic background from Australia and the United States remains controversial. The market headed for the weakening of the USD amid the upcoming easing of the Fed's monetary policy, however, in many ways the possible decision of the regulator has already influenced the current level of quotes.

USD/JPY

The US dollar showed ambiguous dynamics against the yen at the end of the week, reversing near the updated local lows of the beginning of the year. The reason for the slowdown in the "bearish" dynamics was the technical correction, as well as the relatively weak macroeconomic statistics from Japan. Nikkei Manufacturing PMI in June fell from 49.8 to 49.5 points, which turned out to be worse than the expectations of 50.0 points. The growth of the national consumer price index in May slowed down from 0.9% YoY to 0.7% YoY, coinciding with analysts' forecasts. Today, investors are focused on the publication of indexes of leading and coincident indicators in Japan in April. On June 25, the market is waiting for the publication of the minutes of the Bank of Japan meeting.

Oil

Oil prices showed a moderate increase on June 21, responding to increased tensions in the Middle East after the incident with the US drone shot down by Iran. On Friday, Donald Trump canceled a strike on Iran noting that this could cause a disproportionate loss of lives, so the market is now waiting for the current sanctions to strengthen. In any case, the prospects for US-Iranian relations have noticeably deteriorated and it is obviously not necessary to count on normalizing the situation in the near future. On Friday, slight pressure on quotes was provided by the published Baker Hughes report on active oil platforms in the United States. During the week, the number

Morning Market Review
2019-06-26 08:30 (GMT+2)
EUR/USD

The euro showed a decline against the US dollar on Tuesday, departing from the updated local highs of March 21. The decline in the European currency was largely technical in nature since the macroeconomic background from the USA remained ambiguous and there was little interesting data from Europe. Sales of new houses in the United States in May decreased significantly (by 7.8% MoM after falling by 3.7% MoM last month). Analysts had expected growth by 1.9% MoM. At the same time, the housing price index in April rose from 0.1% MoM to 0.4% MoM, which turned out to be better than the forecast of 0.2% MoM. Today, the instrument continues to trade within a downtrend. On Wednesday, investors are focused on the presentation of the ECB representative Yves Mersch, as well as statistics on consumer confidence in Germany. The United States will publish the dynamics of orders for durable goods.

GBP/USD

The pound fell markedly against the US dollar on Tuesday, stopping the uptrend which developed since June 18. Uncertainty around Brexit continues to exert pressure on the British currency. In the light of the forthcoming elections of the Prime Minister, the issue of leaving the UK from the EU without an agreement is being discussed more and more and scares investors with additional risks for the British and world economy. Additional pressure on the pound on Tuesday was put by the published CBI report on retail. In June, sales fell sharply by 42% MoM after falling by 27% MoM last month. Analysts had expected an improvement in the dynamics and a decline in the indicator only by 10% MoM. Today, the pair is trading in both directions, and investors expect new drivers to appear on the market. The focus of attention on Wednesday is the speech of the head of the Bank of England Mark Carney at the hearing of the report on inflation in Parliament.

AUD/USD

The Australian dollar maintains a fairly confident upward trend against the US one in the short term. The demand for safe assets in the market is still increasing, as the factors of growing concern remain in place. Investors are frightened by the aggravation of the geopolitical situation in the Middle East and assess the chances of an armed clash between the United States and Iran. Also, traders are waiting for the start of the G20 summit in Japan, within which US President Donald Trump should hold a meeting with PRC President Xi Jinping. Disruption of the negotiations will put additional pressure on USD.

USD/JPY

The US dollar showed ambiguous dynamics against the Japanese yen on June 25, having managed to update the local minima of the beginning of the year. The reason for the emergence of such dynamics were the publication of the minutes of the BoJ meeting and uncertain statistics on the construction market in the United States. Regulator's protocols have once again confirmed the course for a soft monetary policy, which can remain unchanged at least until spring 2020. Today, the dollar is trading within an uptrend, which is due to investors fixing a short profit in the Japanese currency. On Wednesday, there would be no interesting statistics from Japan, so the US data will be in the spotlight.

Oil

Oil prices showed a moderate increase on June 25, which was caused by a weaker dollar and a published API report on oil reserves. According to the report, over the week of June 21, the volume of oil reserves in US warehouses decreased by a confident 7.550 million barrels, which is significantly stronger than the decline of 0.812 million over the previous period. Quotes are also supported by growing tensions between the USA and Iran after Donald Trump's administration introduced new sanctions against the leadership of Tehran on Monday. On Wednesday, investors are focused on the publication of a report on oil reserves from the US Department of Energy.