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Forex Daily Market Analysis from ForexMart

Discussion in 'Forex Forum' started by Andrea ForexMart, Oct 4, 2016.

  1. KostiaForexMart

    KostiaForexMart Well-Known Member

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    Brent. April 13, 2020 – Oil declines despite new OPEC deal

    At the beginning of the week, oil shows a decline to the area of $31 per barrel. This weekend, OPEC, Russia, the United States and other oil-producing countries nevertheless came to an agreement on the main conditions of the new deal and agreed to reduce production by 9.7 million barrels per day during May-June. Such volumes account for about 10% of global supplies.

    Experts note that this decline in oil production has become the largest in history. Previously, the pact participants intended to reduce production by 10 million barrels per day, but Mexico refused to reduce its share by 400 thousand. The United States agreed to take on part of the Mexican share, thereby reducing it to 100 thousand barrels.

    Despite the success of the negotiations, traders are in no hurry to open «long» positions. The problem is that the actual reduction is still not enough to eliminate the imbalance in the oil market (in the amount of 20-25 million barrels). Moreover, the new deal will end in June, so the issue of additional reduction will again become relevant in the second half of the year.
     
  2. KostiaForexMart

    KostiaForexMart Well-Known Member

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    Fundamental Review for April 14: China, Risk Assets, USA

    Investor sentiment on global markets remains moderately optimistic after the release of statistics on China's trade. According to the PRC General Directorate of Customs, exports in March fell by 6.6% YoY after falling by 17% in February. Imports were down 0.9% after falling 4%.

    Such dynamics indicate that business activity in the country began to recover after quarantine, which supported the appetite for risky assets in global financial markets. Additional support to risk is provided by a visible slowdown in the spread of coronavirus in the world. According to official sources, only 70 thousand new cases of the disease were detected yesterday.

    However, investor sentiment may already worsen after the International Monetary Fund (IMF) conference, at which representatives of the organization will present a revised forecast for the dynamics of the global economy in 2020. New data is not expected to please markets.

    As for the United States, the banking reporting season is starting today: Wells Fargo and JP Morgan are expected to publish financial results. The US stock market may be under visible pressure if financial indicators do not meet the expectations of analysts.
     
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  3. KostiaForexMart

    KostiaForexMart Well-Known Member

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    Brent. April 15, 2020 – Oil resumed to decline

    Today, Brent quotes continue to decline after yesterday's fall. The current quote of the asset is $28.35 per barrel. As expected, the new OPEC+ agreement to reduce oil production did not bring positive results, because it was adopted too late. Moreover, market participants believe that a reduction of 9.7 million barrels per day will not be enough to stabilize supply and demand in the oil market.

    Also yesterday it became known that the Texas oil regulator discussed the possibility of a coordinated limitation of oil production in the state, but it was not possible to reach a consensus. The US Department of Energy noted that production in the country will decline naturally in the face of low commodity prices.

    An additional source of negativity for Brent was a report from the American Petroleum Institute (API), which reflected a 13 million barrels increase in crude stocks in the country. If today's statistics from the Ministry of Energy confirm an increase, Brent quotes will continue to decline to an area below $28.
     
  4. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. April 16, 2020 – Euro is declining, the dollar is gaining strength across the entire spectrum of the market

    On Thursday, the euro continues to decline amid a general strengthening of the US dollar across the entire spectrum of the market and the flight from risky assets. Investor sentiment worsened after the publication of the IMF forecast on the dynamics of the global economy in 2020. The Fund noted that the decline in global GDP this year could reach 3% and become the most significant since the Great Depression in the 30-s of the last century.

    The dollar is growing, even despite weak retail sales data and a sharp drop in US industrial production. According to official figures, the decline in industrial production amounted to 5.5% y/y, and the decrease in retail sales – 8.7%. Today, you should pay attention to the statistics on initial applications for unemployment benefits in the United States.

    Thus, under current conditions, the EUR/USD pair is trading at 1.0850. During the day, the euro is likely to maintain its weak position.
     
  5. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. April 17, 2020 – Euro remains weak, approaching 1.08

    At the end of the week, the euro remains under pressure: the current quotation of the EUR/USD pair is 1.0820. The US dollar has received support from published labor market statistics. According to current data, the number of applications for unemployment benefits for the week amounted to 5.245 million against the forecast of 5.350 million and the previous figure of 6.615 million.

    The number of permits issued in March for new construction in the United States amounted to 1.35 million compared with February 1.45 million and a forecast of 1.30 million.

    Today, the final calculation of inflation in March, which was previously 0.7% in annual terms, will act as a determining factor for further dynamics of the euro. Experts predict that the basic consumer price index will remain at 1% y/y, which will put some pressure on the European currency.
     
  6. KostiaForexMart

    KostiaForexMart Well-Known Member

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    Economic review for April 20, 2020

    At the beginning of the week, mainly negative moods are observed on global exchanges: the US dollar is growing moderately, futures for the S&P 500 index are trading at a slight minus, and Asian indices are also declining.

    The focus of markets remains the gradual abolition of quarantine measures in the United States and some European countries. However, this partial return to normal economic activity was announced last week, so it is unlikely that new reports of quarantine cancellation will be received with due optimism.

    At the same time, the spread of infection in the world remains stable. Over the weekend, the increase in cases amounted to 80-85 thousand people per day. Worldwide, there are about 2.5 million cases of the disease.

    Today is not rich in macroeconomic publications; only data on inflation in New Zealand and the trade balance in Japan can attract attention. The first indicator rose 0.8% in March and reach 2,5%. This country became the only one where inflation showed growth. Japan’s exports declined by 11.7% in March and trade surplus sinks by 90%.

    It should also be taken into consideration the reduction in the base rate by the People's Bank of China from 4.05% to 3.85%.
     
  7. KostiaForexMart

    KostiaForexMart Well-Known Member

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    USD/CAD. April 21, 2020 – Canadian dollar suffers losses

    The fall in the oil market triggered a decline in the Canadian dollar, which is in direct correlation with Brent prices. Oil collapsed to a minimum of two decades (to the level of $18.10 per barrel) amid the collapse of global demand and a price war between Saudi Arabia and Russia.

    Oil companies in Canada have already been hit hard by low oil prices, and yesterday's collapse in prices will inevitably lead to the bankruptcy of many industry players.

    The current quotation of the USD/CAD pair is 1.4270. Today, you should pay attention to the data on retail sales in Canada for February. The indicator fell from 0.4% to 0.3%, better than forecast. Analysts had expected a decline to 0.2%. Tomorrow is expected to publish a consumer price index: experts predict a decline from 0.4% to -0.4%.
     

  8. KostiaForexMart

    KostiaForexMart Well-Known Member

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    Brent. April 22, 2020 – Oil shows new lows

    On Wednesday, Brent oil quotes again updated the local minimum and reached $16 per barrel. However, today oil managed to recover to the level of $19.80.

    Such a sharp drop was caused by fears of market participants about the extent of decline in demand for raw materials in the conditions of maximum filling of oil storage facilities. The data from the American Petroleum Institute (API) added fuel to the fire, according to which US crude oil inventories grew by 13 million barrels last week, while gasoline and distillate inventories increased by 11 million barrels in total.

    Today you should pay attention to a similar report from the US Department of Energy. Experts predict an increase in reserves of 15 million barrels.

    At the same time, news that the countries of the new OPEC+ deal will begin to cut production without waiting for May does not bring support to the oil market. Thus, under current conditions, a significant recovery of a commodity asset is unlikely.
     
  9. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. April 23, 2020 – Euro broke down the level of 1.08

    On Thursday, the euro declines, following yesterday's trend. The current quotation of the EUR/USD pair is 1.0780.

    Today, two important events will be of interest. First, in the United States, the US House of Representatives will vote on a new fiscal package of measures to support the US economy worth $500 billion. And in Europe, an EU summit will take place, during which countries will discuss the creation of a pan-European fund that will support the economy for several years. The amount of the fund may be 1.5-2 trillion euros.

    As for macroeconomic statistics, today business activity indices in the manufacturing and services sectors for April in France, Germany, the eurozone and the UK will be released. The United States will provide data on changes in the number of initial applications for unemployment benefits. Experts predict an increase in the number of applications by 4 million.

    The RSI indicator is pointing down, which signals a continued decline in the European currency. However, the listed events and publications can significantly change the direction vector of the pair. So, follow the news.
     
  10. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. April 24, 2020 – Euro in the range of 1.07-1.08

    At the end of the week, the EUR/USD pair continues to decline, having reached 1.0725. The euro came under pressure after the publication of weak PMI indexes of business activity. According to recent data, the composite index in the EU fell to 13 points, which was the strongest drop in the history of observations since 1998.

    Experts note that quarantine measures have a negative impact on the European services and manufacturing sector. Moreover, analysts expect European GDP to fall by 7% in 2020.

    Yesterday, EU heads of state held a summit to discuss the need to create a new fund for economic recovery. However, despite the criticality of the economic situation, no decision was made on the size of the fund and the sources of its financing. The following negotiations have been postponed to May 6.

    Yesterday, the US provided unemployment data, according to which the number of benefits increased by another 4.5 million people. The total number of unemployed Americans rose to 26 million. These data put pressure on the dollar today, which allowed the EUR/USD pair to recover to 1.0775.
     
  11. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. April 27, 2020 – Euro strengthens on positive news from Europe

    At the beginning of the week, the euro is showing growth, approaching 1.09. Support for the currency was provided by news that EU leaders agreed to create an emergency fund to restore the European economy with a total size of about 1.5 trillion euros.

    In the US, President Donald Trump also signed into law to allocate $484 billion to accelerate the pace of economic recovery, but the news did not provide adequate support to the dollar. The fact is that the States presented data on consumer sentiment in the country: the indicator showed a decline for the third month in a row.

    It is also worth noting that the United States and Europe intend to gradually lift quarantine restrictions from the beginning of May. Experts predict that economic recovery in all countries will occur extremely slowly, which does not add optimism to market participants.

    Today is not rich in macroeconomic news; the EUR/USD pair will fluctuate around 1.0850. This week we should pay attention to two important events – the US Federal Reserve meeting (29.04) and the ECB (30.04).
     
  12. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. April 28, 2020 – Euro is moderately growing to 1.09

    The euro continues to grow on Tuesday, approaching 1.09. The fact is that the US dollar fell across the entire spectrum of the market after the growth of futures for US stock indices. Moreover, the appetite for risky assets increased after many countries presented plans to ease quarantine restrictions for many enterprises.

    Today is not rich in macroeconomic publications. Attention may be drawn only by data on home sales in the US secondary market for March (a decrease of 9.7% is expected), as well as an indicator of consumer confidence and the Richmond Fed manufacturing index for April.

    Market participants remain neutral in anticipation of tomorrow's meeting of the US Federal Reserve. And although analysts do not expect the introduction of any additional incentive measures, the regulator will have to provide relevant estimates of the economic consequences of the virus.
     
  13. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. April 29, 2020 – The dollar is weakening in anticipation of the US Federal Reserve meeting

    On Wednesday, the euro continues to grow moderately in anticipation of the results of the upcoming meeting of the US Federal Reserve. Most likely, the regulator will keep the rate and monetary policy at the same level, but it is worth paying attention to the press conference of the Fed head Jerome Powell. The politician must report on the future purchase of government bonds.

    Yesterday's data on the index of industrial activity from the Federal Reserve Bank of Richmond put pressure on the dollar – the figure in April fell from the level of 2 points to -53. This was the strongest index drop in history. In addition, the foreign trade balance deficit in March amounted to $64.22 billion, compared with a deficit of $59.89 billion a month earlier.

    Today, attention should be paid to the publication of preliminary US GDP. Analysts forecast a decrease of 4%. In the euro area will be published consumer confidence index for April. Experts expect the figure to be -22.7 points. The current quotation of the EUR/USD pair is 1.0865.
     
  14. KostiaForexMart

    KostiaForexMart Well-Known Member

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    Brent. April 30, 2020 – Oil started to grow, receiving the support of several factors

    On Thursday, Brent crude quotes rose to $26.60 per barrel, receiving support from data on crude oil reserves in the US from the country's Ministry of Energy. According to the recent report, stocks of raw materials in US storage facilities grew less than forecast – by only 9 million barrels. The forecast assumed an increase of 10.6 million barrels.

    Additional support for oil prices was provided by a general improvement in market sentiment amidst the fact that some countries are considering mitigating the restrictions associated with coronavirus.

    Experts also note that from May 1, the terms of the new OPEC+ agreement to reduce global oil production will come into force. Norway also joined the deal, saying that in June the country intends to reduce production by 250 thousand barrels per day, and in the second half of the year – by 130 million barrels.
     

  15. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. May 1, 2020 – Euro rose to 1.0980 after the announcement of the ECB meeting results

    The EUR/USD pair rose to two-week highs, reaching 1.0980. Yesterday, the results of the ECB meeting were announced, at which the regulator kept the interest rate at 0%, and the deposit rate at -0.5% per annum.

    The Central Bank also announced the launch of a new program for long-term lending to eurozone banks and stated its readiness to increase the scale of the Pandemic Emergency Purchase Program (PEPP) announced in March, currently amounting to 750 billion euros. These measures supported the European currency.

    The US dollar was under pressure from weak statistics. In particular, the weekly report on the number of applications for unemployment benefits recorded an increase of up to 3.839 million against a forecast of growth of up to 3.500 million. Data on expenditures and incomes of the population in March also fell below expectations: the first indicator fell by 7.5%, and the second – on 2%. Analysts had forecast values at 4.8% and 1.6%, respectively.

    Today the news background is calm, in a number of European countries it is a day off. Only data on the April index of business activity in the USA can attract attention: experts expect a decrease to 36.7 points against the previous value of 49.1.
     
  16. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. May 5, 2020 – Euro declines after weak data emerges from eurozone

    On Tuesday, the European currency continues to decline, reaching 1.0840. Sentix data exerted pressure on the euro: the May consumer confidence index fell to -41.8 points against the forecast of a decline to -33.5. Moreover, the index of business activity in the manufacturing sector in Germany fell in April from 45.4 points to 34.5, while the experts' forecast suggested a fall to 34.4 points. The indicator for the entire region fell to 33.4 points against the forecast of 33.6.

    Today, the German Constitutional Court will rule on the ESM incentive program and the EU fiscal pact. The approval of the program can provide some support to the euro.

    Earlier the United States provided data on the volume of factory orders in March. The indicator decreased by 10.3% in monthly terms against the previous fact of a decrease of 0.1% m/m and the forecast of a decrease of 9.2% m/m.

    Today, you should pay attention to statistics on the producer price index in the eurozone in March. The indicator fell from the level of -0.7% to -1.5%. The United States will present data on the trade balance for March and the index of business activity in the service sector for April.
     
  17. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. May 06, 2020 – Euro broke down the level of 1.08

    The euro remains under pressure amid weak demand for risky assets due to rising tensions between the US and China. At the same time, the US dollar received support from the strong macroeconomic statistics. Data on business activity in the service sector showed a decrease from 52.5 to 41.8 points. Fresh data significantly exceeded the expectations of analysts who predicted the index to fall to around 38.0.

    The main event of yesterday was a statement by the German Constitutional Court, which accused the European Central Bank of exceeding its authority in the implementation of certain points of the quantitative easing program (QE).

    Additional pressure on the European currency was provided by weak statistics from the eurozone: the producer price index fell to -1.5% (forecast -1.3%). And the publication of the report on retail sales showed a drop from 0.6% to -11.2%.

    The current quotation of the EUR/USD pair is 1.0780. The RSI indicator on the H1 chart bounced off the support level, which signals the completion of the downward euro rally. During the day, the pair will continue to fluctuate slightly near the level of 1.0800.
     
  18. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. May 07, 2020 – Euro continues to trade below 1.08

    On Thursday, the euro continues to decline, reaching 1.0785. Pressure on the European currency was exerted by a court decision to challenge Germany’s participation in the eurozone economy stimulus program.

    Additional pressure on the asset was provided by weak data from Europe. In particular, the business activity index in the eurozone services sector in April fell from 26.4 points to 12, while the forecast suggested a decrease to 11.7 points. Composite business activity index was 13.6 points against the forecast of 13.5. Moreover, the European Commission has adjusted the forecast for unemployment in the eurozone from 7.5% to 9.6% against the backdrop of the fight against coronavirus.

    Moreover, weak macroeconomic data came out in the United States either, however, the «Eurobulls» were not able to take control of the situation. According to ADP, in April, a record 20.236 million Americans lost their jobs.

    Today you should pay attention to the data on the change in the number of initial applications for unemployment benefits in the United States over the past week.
     
  19. KostiaForexMart

    KostiaForexMart Well-Known Member

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    EUR/USD. May 08, 2020 – Dollar weakens awaiting labor market statistics

    Yesterday, trading on the euro ended with growth to the level of 1.0850. The US dollar showed some weakening, as an increase in risk appetite of investors led to a decrease in demand for safe assets.

    In addition, investors are worried about the negative interest rate by the US Federal Reserve. Experts note that the yield on 2-year Treasury bonds, sensitive to the expectations of the monetary policy of the Federal Reserve, fell to a record low closing value of 0.133%.

    Yesterday, macroeconomic statistics from the United States also acted as a pressure factor on the US dollar. Over the past week, another 3.169 million Americans have filed initial jobless claims. As a result, since the end of March, there have been 33.5 million such applicants.

    Today we should pay attention to an important report on the labor market in the States. Analysts' forecasts are rather gloomy: employment in non-agricultural sectors is expected to decrease by 22 million jobs, and the unemployment rate may jump from 4.4% to 16%. In anticipation of these statistics, the EUR/USD pair will continue to grow above the level of 1.0850.
     
  20. KostiaForexMart

    KostiaForexMart Well-Known Member

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    Brent. May, 11 – Oil continues to decline at the beginning of the new week

    At the beginning of the trading week, oil continues to decline to $30 per barrel. However, buyers are able to maintain their positions even against the backdrop of doubts about the success of the new OPEC energy pact, as well as amid the pessimistic comments by Fed representatives about the pace of economic recovery after the pandemic.

    Brent remains under pressure from rising stocks and still depressed oil demand. According to data from the IEA published last week, US stocks rose 4.6 million barrels (to 532.2 million barrels). Moreover, inventory growth has been observed for the third week in a row.

    Thus, the collapse of demand, coupled with the lack of available storage space for hydrocarbons, will inevitably lead to a further decrease in oil quotes.
     

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