Oil Day & Some Shenanigans

The USD woke up today pined from all directions. US-Trade Tariffs saga is unabated. The DXY slipped some 0.05% vs.. a basket of some s”major” currencies, by 08:00GMT to be trading in a range of 94.53 – 94.73

Asian Shares were mostly down trotting. The Chinese Yuan fell adding to the dismal state of affairs in the Asia Pacific.

European Stocks have also been a bit skirmish. Reports from the Automobile industry were disappointing leading to a drop of 0.69% in Germany 30/DAX 30, to trade between 12,126.80 – 12,251.95.

Wall Street is relatively silent with 17 companies releasing their earnings reports today the USA 30 amongst others indices like NASDAQ are expected to post small gains.

EUR/USD was struggling for directions moving between small gains and losses in a range of 1.1622 – 1.1672.

GBP/USD was trending low between 1.3189 – 1.3234 awaiting further insights from BOE Governor Mr. Mark Carney,

JPY was the most notable profiteer as seen with the USD/JPY in a drop of -0.18% ranging between 109.37 – 110.20.

Gold prices have stunned market participants, as it lost most of its flare trading in the comfort zone of 1,255.00 – 1,261.10.

Oil Price is boosted up as US press other countries to abandon Iranian Oil, disruptions in supply from Libya, Canada, and Venezuela render support for WTI prices which is seen up ticking it is predicted to be able to cross the $71.30 threshold ahead of today’s EIA, Energy Information Administration report on Crude Oil weekly inventories. The expectation is for a 2 million draw, and this will spike prices and rightfully so, investors are finding it attractive to cap profits. WTI was ranging between 70.56 – 71.22

Crypto is mixed today shedding gains from Tuesday. With the Legal battles of Mt Gox out of the way.

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Uncertainties amid Risk-On /Risk-Off

  • US Trade Tariffs is heating up the market with capricious consequences. Risk-On /Risk-Off mode is becoming the norm for investors. A time when Fundamentals and technical don’t always agree. The Market is bracing for US President Trump’s announcement of Tariffs on Friday.
  • Global stocks have been subdued, with most of Asia down especial Chinese & South Korean shares lingered while the Japanese trumped. European Shares recalibrated into a positive mode following Monday’s selloff. The Germany 30 recovered 0.5% breaking the first resistance of 12,321 with moderate gains expected. The UK FTSE 100 & French CAC40 also posted gains. Italy 40 was the odd one out with US Share running helter-skelter. As investors await earnings reports from companies like Nike and Bed, Bath & Beyond to tip trends in favor of the US stocks. perhaps boosting the USA30 and DJIA.
  • Commodities have been messy Tuesday morning with mixed and uncertain undertones.
    Gold price plunged -0.63 % by 07:17GMT trending between 1,259.50 – 1,269.40. Analysts argue there could be more downside.
  • Oil Prices on the other kept an upbeat outlook although plagued by OPEC+ decision to increase production, supply disruption from Libya provides somewhat support ahead of today’s API/ American Petroleum Institute report on weekly oil stockpiles. A release of a draw will elevate prices, while built-in stockpiles will send prices down. It is presumed to range from 68.03 – 68.56 by the time of print 08:28GMT was up 0.22%
  • The US Dollar receded slightly allowing other majors currencies to stage a brief comeback on Tuesday morning. However, a comment from White House trade adviser Peter Navarro calming investors, that the Trade Tariffs will not be as damaging for the tech sector prompted the USD to regain grounds,
    The EUR/USD which surged to two weeks high of 1.1720, slide -0.41%. Ranging from 1.1651 – 1.1720.
  • As a sideshow, the Cryptocurrencies began tacking on gains as more react to one side report from the Bank of International Settlements (BIS), which squared cryptocurrency in a dim light. Volatility remains.
  • Today US CB Consumer confidence report will be elementary in gauging confidence for the USD
    The JPY is still the preferred safe heaven USD/JPY was down 0.05% trading between 109.37 – 109.80 abandoning the 110 handle. Hence the EUR, GBP, AUD, CHF, CAD, are bearish vs. USD.

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Consequences all round with some Turkish delights

The Market today seems to be plagued by the same ills as the week which preceded it and some new spice. The USD remained susceptible to the US-China Trade war as with other major currencies, shooting guns. Coupled with other local geopolitical pressures such as OPEC+ meeting summary, Election in Turkey. Brexit and the 27th World Gas Conference (WGC 2018) in Washington DC from today 25th to 29th June. Volatility is going to be stretched in unique ways.

The Turkish Presidential Elections end peacefully over the weekend with President Erdogan acquiring another five years in office. The EUR/TRY and USD/TRY surged on jubilations ahead of the official declaration, however downside for TRY is inevitable. By 08:05GMT USD/TRY had receded -1.86% ranging between 4.5343 – 4.6612. analysts believe the could be a rally of about 2-5% for the lira before dropping.

The USD yields dropped from previous highs pulling the USD back slightly. The incline between the EUR/USD up 0.09% could be used as evidence to support the claim that the USD has weakened. USD/JPY is another testament to the fact that some investors have moved to somewhat safe heaven trading. The GBP is likely to pick up a limited amount of pace as the USD unwinds.

Commodities have been slow to surge. Gold is looking to tack on small gains as USD retreats, ranging between 1,266.00 – 1,274.40. Oil prices rose Friday and throughout the weekend as OPEC, and its allies agreed to production increase which was seen by investors as a “modest’ increase and thus bullish for oil, in line with the market expectation of a raise between 300k-600k.

OPEC+ concluded with a rise of 600k-800k barrels per day. WTI Oil prices jumped to test the $ 69 bbl handle. However, lost steam as investors considered the long-term effects of oil’s outlook. Traders are likely to witness knee jerking reaction as it trades between 68.16 – 68.89.

Global indices slide, while Asian shares dropped, EU plummets Europe Banks and Industrial stocks flopping, German Business Ifo is expected to disappoint

Cryptocurrencies are on the upside after BTC plummeted below the 6000 thresholds. the vast majority of the top 100 tokens are rallying

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OPEC Meeting Finalization & Direction

 Following a disappointing report from the Philadelphia Fed Manufacturing Index on Thursday, which reported on contractions in the sector from 34.4 in the month of May to a steep drop of 19.9 in June, USD plunged from 11-month highs.

 With the USD down other majors such as the EUR, GBP, AUD, & JPY took advantage to rally amid a weaker dollar.

 The GBP rose on upbeat forward guidance from BOE, even though the BOE stayed pat on interest rates, signally August as the likely time to hike and consider winding down on its Asset purchasing program. GBP/USD was up 0.35% trading between 1.3239 – 1.3300, It seems 1.3300 is set as the first resistance level which if broken could send GBP to 1.3400handle. Although this may be too optimistic.

EUR/USD jumped back to live, up 0.37% trending in the zone of 1.1601 – 1.1673. Economic reports delivered earlier this morning give the EUR more support.  EU commissioner declares an end to the Greek Financial turmoil which may elevate the Eurozone as quantitative tapper becomes appealing for the ECB.

The gold price has been deliberating on direction Friday driven by profit-taking and the loss of the dollar’s momentum. XAU/USD were seen up 0.11% ranging between 1,268.40 – 1,268.68 by 07:48 GMT. Volatility is expected. Silver, copper, Nickel, and Aluminium are all with Bullish undertones.
 Oil prices rose today. However, its uptrend could be interrupted and impacted by the finalization of OPEC+ meeting in Vienna on Thursday and today. It is expected that an agreement to increase production will be reached. Perhaps with implication held up till Monday since most markets are closed for the weekend. OPEC+ lead by Saudi Arabia, cut production by 1.8million barrels to curb slumping oil prices a stabilize supply and demand. The efforts of OPEC + have been overshadowed by US production boost to morph into the world largest Oil producer by the end of the year or sooner.
 Oil prices in between the $60+ bbl handle. At the moment WTI price is up 0.96% gliding bullishly between 65.72 – 66.64

Asian shares plummeted as investors prudently monitor developments of the US lead Trade tariffs and China’s possible retaliation move. EU and US shares are bullish to mixed Germany 30 up, with Uk’s FTSE100, and France’s CAC40. Yet selloff may be inevitable entering into the weekend.
Cryptocurrency trades sold off, sharply erasing modest gains from Wednesday as South Korea announces further probes into the recent hack which had the perpetrators get away with over $30million worth of cryptos.

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Capricious Oil & British Pound pounding

    In anticipation of the Bank of England’s Rate Decision which is to be delivered at 12:00GMT, investors are cautiously monitoring developments of the GBP in its downtrend after dropping to 7- months lows on Wednesday to 1.3145. GBP/USD had shed -024% by 07:31 GMT, ranging between 1.3125 – 1.3178. The slight corrections came as PM Theresa May claimed victory in parliament over related Brexit matters. However with Traders recalling BOE Governor Mark Carney’s speech last month indicating rate hikes will be put off till August. GBP selloff is inevitable.

    The USD has been bullish and continued to maintain that status. USD was up against all major currencies notably with the EUR, GBP, JPY, and AUD, as traders move from risk aversion. The DXY is up 0.21% trending between 95.10-95.41 cruising over 11-months highs. USD/JPY is up 0.17% at the time of print 07:52GMT with possible upside in view.

     The cryptocurrencies edge up after revelations of another hack was thawed. Bittumb stopped all transactions on Wednesday after it lost close to $31 million. BTC/USD moved to pass the 6,700 handle up 1.89% ETH/USD up by 2.99% and XRP/USD up2.42%

    Commodities got the bitter end today, with Gold down stepping with a loss of -0.61 % ranging between 1,263.60 – 1,272.00 Silver follows Gold, while Copper gains attention with Aluminium and perhaps Nickel retaining bullish trends.

    Oil has been swinging in bearishly ahead of the OPEC meeting which starts today in Austria, Vienna and ends Friday. It was reported that OPEC is divided on how much to increase productions amid resistance from some OPEC members like Iran & Venezuela who by de facto oppose an increase in production. The slumping prices will affect their profit margin as it cost them more to produce a barrel of Oil.  WTI prices have been stuck ranging in between 65.33 – 65.78 downsides are expected to at least 65.05 before corrections, or further slumps are seen. Abrupt swings are expected as investors tune into any news that may come out of OPEC+ sentiments remain murky.

    Asian Shares rose Thursday morning however quickly turned mixed. The same behavior is expected out of Europe and projected on to the US. Germany 30 dropped after Daimler automaker warned of profits getting hit by trade tariffs, UK’s100, France CAC40 and Italy40 are all to be seen in and out of gains.

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The USD is Marching on ..

  • With the US-China trade friction, unabated traders and investors are cautiously scanning for beneficial assets while in tune with market sentiment. Recent Geopolitical events have had their toll on market nerves.
  • In queue with the Fed rate hike, spreadbetters are buying the USD. The Dollar Index DXY which measures the strength of the USD vs other currencies rose 0.03% to be trading in between 94.96 – 95.30. with US yields pointing up
  • As the USD gained other majors fell. EUR, GBP, & JPY are the most notable, However, commodities were hit as well. Gold lost its safe haven luster shedding -0.29% to trade between 1,273.30-1,278.50
  • Meanwhile, Asian stocks buoyed by positive Chinese data and a thaw in the US-China trade conflict rhetoric.
  • With Asia up, European shares are likely to benefit from the up trends to push Germany’s DAX 30, UK’s FTSE 100, and France’s CAC 40  up. Driving the US with it 
  • Cryptocurrencies lost the steam it had Tuesday and could be seen in the bearish mode
  • Oil remains politically charged with eyes on upcoming OPEC meeting set for 21st-22nd June. Tuesday’s abrupt surge before the release of the oil reports, turned into a dovish trend after the API/American Petroleum Institute report reveals a drop of nearly 3 million barrels in the weekly stockpiles. Ahead of today’s Crude Oil inventories report volatility is highly anticipated. By the time of print 11:17 GMT WTI Oil was ranging in between 64.81 – 65.52 up 0.03% with further upside should the crude oil inventories report come out with a draw.

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