Shanghai composite returned today to the red territory trading below 3000, after rebounding of the risk appetite by the end of yesterday session could be extended into the US session with oil benchmarks ability to rise from their new 12 years low levels below $30 which have been recorded this week.
US Import Price Index of December has fallen by 6.5% y/y, after 6.3% decreasing in November and also US Export Price Index came down by 8.2%, after declining by 9.3% in November because of the greenback appreciation amid oil prices weakness and also retreating of commodities prices showing low pressure on the Fed to raise rates for containing the inflation.
From the other side of the Atlantic, BOE expected yesterday inflation rising by a gradual pace, after unusual large drags from energy and food prices, while the core inflation pressure remains relatively subdued.
The cable kept trading around 1.4400, after MPC had voted 8:1 for keeping the interest rate unchanged at 0.5%, as it has been since Feb 2009, because Ian Mc Cafferty is still considering hiking the interest rate by 0.25% to 0.75%, before watching inflation building pressure by the wages rising, British pound depreciation and domestic costs, as long as there is conviction among the members that the pace of tightening will be gradually.
MPC voted unanimously to hold BOE’s APF at Stg375b, as it has been since July 2012 re-investing the £8.4 billion of cash flows associated with the redemption of the January 2016 gilt held in the Asset Purchase Facility.
Instrument in Focus: GBPUSD
The cable could rebound from 1.4350 keeping June 2010 supporting level at 1.4345 unbroken until now but this try to rise again could not get the cable daily RSI out of its oversold area below 30 reading now 21.795.
While its daily Stochastic Oscillator (5, 3, 3) which is more sensitive to the volatility is having now its main line barely in the neutral region coming up from its oversold area below 20 reading 20.023 and also its signal line which is reading now 22.017, after a shy try to correct some of its oversold stance has been faced by resistance at 1.4474, before residing for trading currently near 1.44 in its day number 22 of continued being below its daily Parabolic SAR (step 0.02, maximum 0.2) which is reading today 1.4527.
Important levels: Daily SMA50 @ 1.4950, Daily SMA100 @ 1.5141 and Daily SMA200 @ 1.5308
S&R:
S1: 1.4345
S2: 1.4257
S3: 1.4228
R1: 1.4474
R2: 1.4643
R3: 1.4723
GBPUSD Daily Chart:
Commodities: Gold
The risk-on sentiment could come back to the markets putting pressure on the gold to retreat yesterday to $1071.22 level, before residing for trading now near $1080 per ounce just above its daily SMA50.
The demand for safe haven could drive the gold up reach by the end of last week $1112.75 which has been its highest reached level since last Nov. 4 but it retreated again failing to maintain a place above its daily SMA100.
Despite yesterday retreating to $1071.22, XAUUSD daily Parabolic SAR (step 0.02, maximum 0.2) is still below its trading rate for the tenth consecutive day reading now $1071.22 too. The gold could rise for trading above this indicator, after having a higher bottom at $1057.98 following maintaining existence above $1046.08 by rising from $1047.46 on last Dec. 17.
Important levels: Daily SMA50 @ $1079.17, Daily SMA100 @ $1107.69 and Daily SMA200 @ $1136.08
S&R:
S1: $1071.22
S2: $1057.98
S3: $1046.08
R1: $1112.95
R2: $1123
R3: $1138.05
XAUUSD Daily chart:
Hot instrument: EURUSD
EURUSD has spent most of this week trading times close to 1.0880, after finding support at 1.0709 following retreating from 1.0968.
The pair is still keeping a place for trading above its daily SMA50 but with continued existence below its daily SMA100 and daily MA200.
The pair is still trading below its daily Parabolic SAR (step 0.02, maximum 0.2) which is reading today 1.0941 in its eleventh consecutive day of being above the trading rate with continued existence below the trendline resistance extension from 1.3992 to 1.1712.
While the pair parameters are showing now balanced situation having its daily RSI in the middle of the neutral reading 50.744 and also its daily Stochastic Oscillator (5, 3, 3) which is more sensitive to the volatility is having now its main line in the neutral region reading 46.513 with its signal line which is reading 50.732.
Important levels: Daily MA50 @ 1.0814, Daily MA100 @ 1.1006 and Daily MA200 @ 1.1047
S&R:
S1: 1.0709
S2: 1.0519
S3: 1.0461
R1: 1.0991
R2: 1.1058
R3: 1.1093
EURUSD Daily chart:
Recommended Content
Editors’ Picks
EUR/USD holds above 1.0750 to start the week
EUR/USD trades in positive territory above 1.0750 in the European session on Monday. The US Dollar struggles to find demand following Friday's disappointing labor market data and helps the pair hold its ground.
GBP/USD clings to small gains above 1.2550
Following Friday's volatile action, GBP/USD edges highs and trades in the green above 1.2550. Soft April jobs report from the US and the modest improvement seen in risk mood make it difficult for the US Dollar to gather strength.
Gold price rebounds on downbeat NFP data, eyes on Fedspeak
Gold price (XAU/USD) snaps the two-day losing streak during the European session on Monday. The weaker-than-expected US employment reports have boosted the odds of a September rate cut from the US Fed.
Addressing the crypto investor dilemma: To invest or not? Premium
Bitcoin price trades around $63,000 with no directional bias. The consolidation has pushed crypto investors into a state of uncertainty. Investors can expect a bullish directional bias above $70,000 and a bearish one below $50,000.
Week ahead: BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.