03july 18 march th 2019-2020 · 2020. 3. 3. · technical outlook: nzd/usd has witnessed some...

July 18th 201903rd March-2020

TIME CURRENCY EVENT EXPECTED PREVIOUS CONSENSUS IMPACT

12:15 PM CHF GDP (QOQ) (Q4) 0.2% 0.4% -NEGATIVE

FOR CHF

03:00 PM GBPCONSTRUCTION

PMI (FEB)48.8 48.4 -

POSITIVE

FOR GBP

03:30 PM EURUNEMPLOYMENT

RATE (JAN)7.4% 7.4% -

NEGATIVE

FOR EUR

- - - - - - -

- - - - - - -

- - - - - - -

- - - - - - -

- - - - - - -

TOP ECONOMIC EVENTS OF THE DAY

SNAPSHOT

SCRIP PRICE % CHANGE TREND

AUDUSD 0.6526 -0.19 WEAK

NZDUSD 0.6261 0.02 NEUTRAL

EURUSD 1.1140 0.08 STRONG

GBPUSD 1.2778 0.22 WEAK

USDJPY 107.97 -0.30 NEUTRAL

USDCAD 1.3336 0.11 NEUTRAL

USDCHF 0.9580 -0.11 WEAK

DXY 97.442 0.13 WEAK

GOLD 1,598.15 0.17 STRONG

SILVER 16.907 1.00 STRONG

CRUDEOIL 48 2.67 STRONG

MARKET BYTES:

• ASIAN EQUITY MARKET CLOSED HIGHERAsian benchmark indices closed higher on Monday despite the CaixinChina General Manufacturing PMI tumbled to 40.3 in and the OfficialNBS Manufacturing PMI also slumped to a record low of 35.7. At close,the China's Shanghai Composite index surged 91 points or 3.2% to endat 2,971, the Hang Seng index rose 162 points or 0.6% to 26,292 andJapan's Nikkei 225 finished 201 points or 1% higher at 21,344.

• AUSTRALIAN ECONOMIC DATA: BUILDING PERMITS SURPRISINGLYPLUMMET

According to Australian Bureau of Statistics, the number of dwellingsapproved in Australia unexpectedly plunged 15.3% in January 2020,compared with market expectation of a 1% increase and after anupwardly revised 3.9% gain in the previous month, which is the steepestdecline in building permits since December 2017,

ASIAN ECONOMY UPDATE

MSCI

OUR VIEW

MSCI has formed a ‘Marubozu’ candle stick pattern in daily scale in which the completeselling pressure is absorbed by the market participants. The 30-days ExponentialMoving Average will continue to act as a major support for the counter. RSI is expectedto expand after breaching 60 levels.

AUDUSD TREND: WEAK

TECHNICAL OUTLOOK:

AUD/USD has formed a ‘Spike and Ledge’ pattern on hourly scale that signals forexhaustion in the uptrend and hints for a bearish reversal. The pair is trading below 30-hours Exponential Moving Average. RSI is expected to witness weakness after slippingbelow 40 levels.

INDICATORS 30 MIN 1 HOUR 4 HOUR DAILY

RSI SELL NEUTRAL SELL SELL

STOCHASTIC NEUTRAL NEUTRAL SELL SELL

BOLLINGER BAND NEUTRAL NEUTRAL SELL SELL

10 SMA SELL SELL NEUTRAL SELL

MA CROSSOVER(20,50) NEUTRAL BUY SELL SELL

SENTIMETER SELL NEUTRAL BUY SELL

FUNDAMENTAL ASPECT:

AUDUSDAUD/USD pair remained in strong bearish territory after the number of dwellingsapproved in Australia unexpectedly plunged 15.3% in January 2020, compared withmarket expectation of a 1% increase and after an upwardly revised 3.9% gain in theprevious month.

STRATEGY

ACTION ENTRY TARGET 1 TARGET 2 STOP LOSS

SELL 0.6512 0.6488 0.6462 0.6533

SCRIP SUPPORT 1 SUPPORT 2 RESISTANCE 1 RESISTANCE 2

AUDUSD 0.6464 0.6436 0.6586 0.6642

0.

NZDUSD TREND: NEUTRAL

TECHNICAL OUTLOOK:NZD/USD has witnessed some selling pressure after tagging 61.8% retracement of A-Bswing as per Fibonacci analysis placed at 0.6278 levels on hourly scale. RSI is tradingback and forth in a narrow range of 40-60 levels.


RSI NEUTRAL NEUTRAL NEUTRAL SELL

STOCHASTIC NEUTRAL NEUTRAL SELL SELL

BOLLINGER BAND NEUTRAL NEUTRAL NEUTRAL SELL

10 SMA SELL SELL BUY SELL

MA CROSSOVER(20,50) SELL SELL SELL SELL

SENTIMETER SELL NEUTRAL NEUTRAL SELL

FUNDAMENTAL ASPECT :NZDUSDThe Kiwi pair is in consolidation phase ahead of the RBA’s interest rate decision asmarket is expecting fresh stimulus from impact of coronavirous. However, kiwi buyersare waiting for Global Dairy Trade Price Index data.

STRATEGY


SELL 0.6237 0.6210 0.6187 0.6260


NZDUSD 0.6186 0.6127 0.6278 0.6360

EUROPEAN ECONOMY UPDATE

MARKET BYTES:

• EUROPEAN EQUITY MARKET CLOSED MIXEDEuropean equities market ended with little change on Monday afterlatest markit PMI data showed that the coronavirus hurt new exportorders in China that disturbed supply chains in the US and Euro Area. Atclose, the FTSE 100 gained 74 points, or 1.1% to 6,655; the CAC 40added 24 points, or 0.5% to 5,333; and the IBEX 35 went up 18 points,or 0.2% to 8,742; while the DAX 30 lost 32 points, or 0.3% to 11,858;and the FTSE MIB slid 329 points, or 1.5% to 21,655.

• UK TREASURY COMMITTEE: QUERY ROUND WITH BOE'S CARNEYAND BAILEYUK Treasury committee said it is going to question Mark Carney onTuesday, alongside members of the Monetary Policy Committee whileAndrew Bailey will be questioning on his appointment as new governorof Bank of England on Wednesday.

EURUSD TREND: STRONG

TECHNICAL OUTLOOK:EUR/USD is trading near its potential resistance that is placed at 1.1172 levels on 4-hourscale. The pair is likely to remain in the grip of bulls as RSI is trading at 75.66 levelsshowing no signs of divergence.


RSI BUY BUY BUY NEUTRAL

STOCHASTIC BUY BUY BUY BUY

BOLLINGER BAND BUY BUY BUY NEUTRAL

10 SMA BUY BUY BUY BUY

MA CROSSOVER(20,50) BUY BUY BUY SELL

SENTIMETER BUY NEUTRAL BUY BUY

FUNDAMENTAL ASPECT :

EURUSDEUR/USD is stretching its gains as the greenback continues to face selling pressure amidrising hopes that the Fed will cut interest rates as soon as March. Soft manufacturingdata from the US contributed additional weakness to greenback. The MarkitManufacturing PMI fell to 50.7 in February, below from 50.8 expected, while the ISMManufacturing Index dropped to 50.1 below the 50.4 estimated.

STRATEGY


BUY 1.1187 1.1210 1.1236 1.1165


EURUSD 1.1104 1.1043 1.1173 1.1243

GBPUSD TREND: STRONG

TECHNICAL OUTLOOK :GBP/USD has formed a classic ‘Marubozu’ candle stick pattern that often signalscontinuation of downtrend. RSI is closed at 65.82 levels showing no signs of divergenceand oversold situation. DMI’s have been converged for continuation of upside.


RSI BUY BUY NEUTRAL BUY

STOCHASTIC BUY NEUTRAL BUY NEUTRAL

BOLLINGER BAND BUY BUY NEUTRAL BUY

10 SMA BUY NEUTRAL NEUTRAL SELL

MA CROSSOVER(20,50) BUY BUY NEUTRAL SELL

SENTIMETER BUY NEUTRAL NEUTRAL SELL

FUNDAMENTAL ASPECT:GBPUSDGBPUSD pair is in positive territory as Brexit hopes continue to underpin the demandfor pound against the greenback. However, there is no economic event in bothcountries today.

STRATEGY


BUY 1.2512 1.2545 1.2578 1.2486


GBPUSD 1.2300 1.2270 1.2380 1.2400

GBPUSD TREND: WEAK

TECHNICAL OUTLOOK :GBP/USD has witnessed a steep fall after tagging its potential ‘Supply’ zone that isplaced in a narrow range of 1.2848-1.2860 levels on hourly scale. RSI is holding below40 levels and hinting for more downside.


RSI SELL SELL SELL NEUTRAL

STOCHASTIC NEUTRAL NEUTRAL SELL NEUTRAL

BOLLINGER BAND SELL BUY SELL NEUTRAL

10 SMA SELL NEUTRAL SELL SELL

MA CROSSOVER(20,50) SELL SELL SELL SELL

SENTIMETER NEUTRAL NEUTRAL SELL SELL

FUNDAMENTAL ASPECT:GBPUSDThe British pound weakened against the Dollar as the first round of trade negotiationsbetween the UK and the EU failed to meet market’s expectations. Also, the Organizationfor Economic Cooperation and Development (OECD) cut its UK 2020 GDP growthforecast to 0.8% led by UK’smanufacturing sector contracted more than previous.

STRATEGY


SELL 1.2738 1.2685 1.2646 1.2764


GBPUSD 1.2766 1.2570 1.2951 1.3070

MARKET BYTES:

• US EQUITY FINISHED MIXED ON FRIDAYU.S equity ended mixed on Friday with S&P 500 and Nasdaq closedmarginally lower at 0.1% and 0.2% or 2 and 18 points respectively whileDow Jones was marginally higher at 0.1% or 37 points as US retail salesbeat market expectations in August led by increase in consumption ofauto sector and online shopping platform stimulate the economicgrowth.

• TRUMP URGE TO GM AS UAW (UNITED AUTO WORKERS) CALLSFOR STRIKE SINCE 2007

On Sunday, President Trump said to avoid the strike around 48,000workers, the UAW and General Motors to come together to negotiateand “make a deal”. The strike is to improve wages, reopen idled plants,add jobs at others and close or narrow the difference between pay ratesfor new hires and veteran workers of UAW while General Motors wantsits employees to pay a standard remuneration of their health careexpenses, and to increase productive work-force in their work place.

US ECONOMY UPDATE

MARKET BYTES:

• U.S EQUITY CLOSED HIGHERU.S equity market closed higher on Monday as market expectations thatmajor central banks could introduce additional monetary stimulus toreduce the impact of coronavirus to avoid recession fear from the market.At close, the final numbers were: the Dow Jones soared 1294 points or5.1% to 26,703, the S&P 500 jumped 136 points or 4.6% to 3,090 and theNASDAQ surged 385 points or 4.5% to 8,952.

• COVID-19 CASES COUNT: NEW CASES FOUND IN MAINLAND CHINA31 NEW DEATHS

Previously: Mainland China as of end March 01:• 80,026 cases• total deaths 2,912 (2,803 of these are in Hubei)

Mainland China as of end March 02:• Total 80,151 cases, and• Total 2,943 deaths

DOLLAR INDEX

OUR VIEW:

The DXY has formed a ‘Bearish Belt Hold’ candle stick pattern that signals the strength ofsellers and continuation of bearish momentum cannot be ruled out. RSI is slipped below40 levels showing no signs of divergence and oversold.

OUTLOOK: WEAK

USDJPY TREND: WEAK

TECHNICAL OUTLOOK:USD/JPY has been bounced back after kissing its potential support that is placed at107.67 levels on daily scale. RSI is trading at 37.35 levels showing no signs of divergenceand oversold. Stochastic oscillator is hinting for more weakness.


RSI NEUTRAL SELL SELL NEUTRAL

STOCHASTIC NEUTRAL BUY SELL NEUTRAL

BOLLINGER BAND BUY BUY SELL NEUTRAL

10 SMA BUY SELL SELL SELL

MA CROSSOVER(20,50) BUY NEUTRAL SELL BUY

SENTIMETER NEUTRAL NEUTRAL SELL NEUTRAL

FUNDAMENTAL ASPECT:USDJPYUSD/JPY is in consolidation phase backed by central bank’s rate cut expectations andweak economic data. The US Markit Manufacturing PMI fell to 50.7 in February againstthe 50.8 reading expected while the ISM Manufacturing dropped to 50.1 below the 50.4of market consensus. However, there is no relevant data to be release today from bothcountries.

STRATEGY


SELL 107.60 107.30 107.06 107.86


USDJPY 107.24 106.50 108.00 109.30

USDCAD TREND: NEUTRAL

TECHNICAL OUTLOOK:USD/CAD is trading in a ‘Falling Channel’ on hourly scale that signals for a consolidatedmove with a negative bias. The pair is trading below 30-hours Exponential Moving Average.RSI is trading back and forth in a narrow range of 40-60 levels.


RSI NEUTRAL SELL BUY BUY

STOCHASTIC NEUTRAL NEUTRAL BUY BUY

BOLLINGER BAND NEUTRAL NEUTRAL BUY BUY

10 SMA BUY BUY BUY BUY

MA CROSSOVER(20,50) SELL BUY BUY BUY

SENTIMETER BUY NEUTRAL BUY BUY

FUNDAMENTAL OUTLOOK:USDCADBulls and bears are pulling each other as business activity in US manufacturing sectorstagnates in February. On the other hand, coronavirus outbreak continuously extendingfears of upcoming recession as a result investors are now betting for an interest rate cutof at least 25bps at the next monetary policy decision later in the week.

STRATEGY


SELL 1.3318 1.3292 1.3267 1.3340


USDCAD 1.3270 1.3201 1.3400 1.3465

USDCHF TREND: WEAK

TECHNICAL OUTLOOK:USD/CHF has witnessed a steep fall after slipping below its potential support that isplaced at 0.9627 levels on 4-hour scale. RSI is trading in a narrow range of 20-40 levels.Stochastic oscillator is hinting for more weakness.


RSI SELL SELL SELL SELL

STOCHASTIC BUY BUY SELL SELL

BOLLINGER BAND SELL SELL SELL SELL

10 SMA NEUTRAL SELL SELL SELL

MA CROSSOVER(20,50) BUY BUY SELL SELL

SENTIMETER SELL BUY SELL SELL

FUNDAMENTAL OUTLOOK:USDCHFUSD/CHF pair is in negative territory after the data published by the Institute for SupplyManagement (ISM) showed that the business activity in the US manufacturing sectorvirtually stagnated with the manufacturing PMI came in at 50.1 in February from 50.9 inthe prior.

STRATEGY


SELL 0.9557 0.9532 0.9506 0.9575


USDCHF 0.9548 0.9422 0.9626 0.9765

GOLD TREND: STRONG

TECHNICAL VIEW:XAU/USD has formed a ‘Spike and Ledge’ pattern on hourly scale that signals forexhaustion in the downtrend and signals for a bullish reversal. The precious metal isexpected to expand after breaching 30-hours Exponential Moving Average.

STRATEGY


BUY 1606.53 1614.57 1621.60 1596.15

SCRIP SUPPORT 1 SUPPORT 2 RESISTANCE1 RESISTANCE2

GOLD 1593.71 1561.08 1628.00 1662.00

SILVER TREND: STRONG

TECHNICAL VIEW:XAG/USD has been bounced back after kissing its potential support that is placed at16.535 levels on daily scale. Stochastic oscillator is on the verge of giving a bullishcrossover, so a reversal cannot be ruled out.

STRATEGY


BUY 17.069 17.220 17.444 16.900

SCRIP SUPPORT 1 SUPPORT2 RESISTANCE 1 RESISTANCE2

SILVER 16.525 15.926 17.353 17.786

CRUDEOIL TREND: STRONG

TECHNICAL VIEW:Crude Oil WTI futures has witnessed sharp up move after giving a breakout of ‘FallingChannel’ that signals for bullish reversal after a negative consolidated move. The blackgold has expanded its gains after breaching 30-hours Exponential Moving Average.

STRATEGY


BUY 48.61 49.52 50.49 47.95

SCRIP SUPPORT1 SUPPORT 2 RESISTANCE1 RESISTANCE2

CRUDE OIL 46.70 43.50 50.50 53.95

03july 18 march th 2019-2020 · 2020. 3. 3. · technical outlook: nzd/usd has witnessed some...

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