Get started

Oilmarkets

Kenji signals: sell oilToday, the indicator "Kenji" on the daily oil chart generated a sell signal. Let's give some explanations on this signal. This is the ordinary signal to open the trade with a basic volume . According to the indicator, the price of oil is currently in the active downtrend phase (the area between the fast and slow averages is colored red). At the same time, current prices entered the sell zone, which led to the formation of a "sell" signal. The long position remains relevant until either the market conditions change (for example, the downtrend changes to flat or uptrend), or a signal to close it appears (a red cross indicating a sharp divergence between the price and average values). Recall, work in a trend is one of the most comfortable and potentially successful trading options. For reference: The "Kenji" indicator is a brand new look at the average analysis. The main problem of most trading strategies and indicators based on the average analysis is a number of false signals in the case of flat and trend reverse (for example, frequent crossings of the averages, numerous changes in the direction of the averages, etc.). As a result, averages analysis cannot show its real power and effectiveness. The Kenji indicator using a unique algorithm avoids the most common average analysis traps and significantly improves the quality of signals by determining the current state of the market (using the color indication "Kenji" shows the current state of the market: red color - downtrend, blue - uptrend, green - flat). It generates signals for comfortable trading in a local trend. The indicator provides information on both the timing position opening and the moments of profit taking. It also helps to determine the level of aggressiveness of a signal. This makes the "Kenji" indicator a handy tool both for novice and experienced traders.
FX:USOILShort
by Trade24Fx
Oil and world are in danger, a pound in anticipationTraditionally, we start the review with news about the coronavirus epidemic. Once again, we note that the matter is even on its scale - thousands of times more people die from ordinary flu, and hundreds of thousands of times more get sick each year. The point is the problems that this epidemic has on the global economy. A number of key industrial centers in China have been completely or partially idle for the third week. Each such day is further destruction of the global supply chain, and if there are still enough stocks in warehouses, then every day the risk of a shortage of materials to continue the activities of companies becomes higher, as well as the scale of losses. One of the main victims this week maybe oil. We wrote that last week OPEC+ was able to tentatively agree to reduce oil production by another 600K b/d. But yesterday information appeared that Russia could refuse this. And here, even in Libya, the warring parties are close to signing a peace treaty, which is fraught with the return of several hundred thousand barrels per day to the oil market. And all this is happening against the backdrop of a sharp drop in oil demand from China. Not surprisingly, some experts predict an oil drop of at least 10% in the foreseeable future. In general, oil sales this week remain our basic trading idea. Returning to the current figures on the scale of the epidemic, we note that the number of deaths is approaching 1,000, and the number of cases is close to 50,000. Once again, we recall that these are official statistics. The main mass of experts converges in opinion, that the figures are underestimated by several times to several tens of times. In connection with such a development of events, we cannot but recall our recommendation to sell the Russian ruble. The conditions for this are almost ideal, especially when you consider that the Central Bank of the Russian Federation lowered the rate again last week and plans to do this further in 2020. Today, in terms of macroeconomic statistics, it will be interesting primarily for the British pound. Data on GDP and industrial production can trigger a surge in volatility in pound pairs. Given that in recent days, the pound was already under strong downward pressure, weak data will almost certainly trigger a new wave of sales. But at the same time, good numbers can give a start for strengthening the pound - points for its purchases are very attractive. In general, today you can try news trading, with pending orders or enter after the news, playing back a fundamental positive or negative.
Long
by Trade24Fx
US encouraging statistics & China’s data manipulationsThe news that a coronavirus vaccine has been found so far remains more likely to be rumors and expectations. At least if you look at the official statistics on the number of deaths and cases of coronavirus. The number of deaths approaches 500, and those infected 30,000. And we are talking about official data. According to many experts, government figures are underestimated at times. The reason for this is both conscious and deliberate manipulation, and a banal inability to take into account all the dead. And while quarantine in China continues, the violation of global supply chains is becoming more and more noticeable every day, as well as the harm it does to the global economy. Of the other news yesterday, it is worth noting unexpectedly good statistics from the United States. According to ADP, US employment increased by 291K jobs (forecast was + 157K). This is the maximum value since March 2017. Business activity indices were also better than expected. In particular, the ISM Index in the non-manufacturing sector in January reached 55.5 points (the forecast was 55.1). The dollar against the backdrop of such data strengthened across the spectrum of the foreign exchange market. But this growth cannot be called rampant. So we rather see it as an opportunity to enter the counter-positions from the most attractive points. These are the pairs EURUSD, GBPUSD, USDJPY, and USDCAD. But these inputs are with minimal stops, because a) positions against the current movement; b) the current movement has serious fundamental foundations and momentum for further development. Shelter-assets paused yesterday in their fall. We remain of our opinion and will continue to look for points for purchases of gold and the Japanese yen both within the day and in the medium term. Oil yesterday quite unexpectedly showed significant growth. What is characteristic, the growth occurred against the background of official data on oil reserves in the USA, which showed a rather substantial increase. However, this did not prevent the asset (WTI benchmark) from gaining a foothold above 51.20. Our position on the sale of oil eventually lost its relevance. However, if oil goes below 51 again, a short position can be restored. Thursday in terms of macroeconomic statistics will be a fairly calm day. So we continue to monitor the epidemic and follow the developed plan.
Long
by Trade24Fx
The markets illogicality the and trading anomaliesTuesday was another recovery day in the financial markets. In general, all this is rather strange and illogical. Markets first fall on the news of coronavirus and the epidemic. Logically and explainable, we will not go into details, and once again build logical chains of consequences. We did this in previous reviews. But upon the receipt of news that the epidemic is developing and becoming the largest in the last 20 years (the number of deaths exceeded 400, and the cases of 20,000), markets begin to calm down instead of continuing to work out a fundamental negative. This can be seen from the dynamics of the stock markets (Nasdaq updated new historical highs, and Tesla shares seem to have forgotten what gravity and common sense are), gold is declining, risky assets are recovering, VIX Fear Index is falling by more than 10% in day, and the Chinese stock market is adding 1-2% per day. The main problem in this chaos is not to lose one’s head and not to succumb to general madness. Ultimately, you need to work not with current prices and their dynamics, but with facts. And the facts are that the epidemic has already caused enormous damage and will continue to cause it. Yes, the extent of the damage is unclear and perhaps it will be partially leveled in one way or another. But it is applied and this is a fact. So, starting from the facts, we consider current prices in the financial markets to be abnormal. Based on the concept of “regression to the average,” prices will sooner or later have to return to their moderately adequate state. Accordingly, today we will buy gold with redoubled energy and volumes (for less aggressive traders, we can recommend selling a pair of USDJPY - the points for sales are simply excellent). Stock market sales remain our No.1 trading idea. Oil sales (WTI benchmark) from 51.20 also seem to be a balanced transaction (stops above 51.20 with profits in the region of 45 or even lower make the transaction extremely attractive). At the same time, we are acting with an eye on OPEC activity. If the cartel decides to intervene, and oil goes above 51.20, then a stop coup is quite possible. Speaking of other news and macroeconomic statistics, we note that today will be published US employment data from ADP. Although the focus of the markets is traditionally focused on the official figures, which will be published on Friday, strong deviations in the fact from ADP from forecasts can provoke significant movements in dollar pairs.
FOREXCOM:XAUUSDLong
by Trade24Fx
2
Markets relax again amid concerns over global economyMonday was a very busy day in the financial markets in terms of price dynamics. The tone was set by China, which opened its stock markets after a long vacation. Expectedly, the market collapsed despite unprecedented restrictive measures by the Government and an infusion of nearly two hundred billion dollars from the Bank of China. The Shanghai Composite Base Index lost $420 billion in value over the day. Experts, meanwhile, note that China is well suited to act as a catalyst for a new global crisis (until recently, the States have done it well). The fact is that in recent years, the role of China in the global economy has grown dramatically. Today, it accounts for about a third of world growth, which is more than the share of the United States, Europe and Japan combined. So if Goldman Sachs analysts are right (they forecast a decline in China in 2020 at 0.4%), then the global economy will face serious problems. Despite the sales in China and the next anti-record coronavirus epidemic, investors again relaxed and calmed down. This already happened last week and turned out to be nothing more than a pause in the main movement. So, such gold descents as yesterday, we recommend using the asset for purchases. Moreover, by itself, the gold market could face a shortage. The fact is that the volume of gold mining in the world in 2020 decreased for the first time in 10 years. All easily recoverable metal has already been mined, which only strengthens the current negative trends for the offer of an asset. The pound dipped well yesterday. Although not the fact that this is its absolute minimum. The fact is that Great Britain and the EU, after the official withdrawal of the first from the Union, switched to the most important thing - the trade agreement. And then, predictably, the parties faced a problem. However, we have already gone through all this over the past 3 years. The parties will exchange threats, raise rates, put pressure on each other in an attempt to win the most favorable conditions for themselves. Given that the period until the end of the year, the pound is waiting for a difficult 8-9 months. We continue to believe that the parties will agree on how this ultimately happened with Brexit. And so we will use the pound's descents as an excuse for his purchases. At least the point 1.2980-1.3000 looks too attractive not to risk buying from it. But with mandatory stops, because it is likely that the pound can be bought even cheaper. Oil (WTI benchmark) yesterday fixed below the support of 51.20. In general, the situation looks rather threatening for buyers, especially since the background is generally favorable for further sales (oil demand in China collapsed by 3 million b/d, which is about 20% of its total consumption).
Long
by Trade24Fx
Markets calm too soon. Preparing for Fed's decisionDespite the fact that the coronavirus epidemic is in full swing (the number of deaths has already exceeded one hundred, and the number of infected has approached 5000), investors sighed with relief. The Fear Index (VIX) crashed 15%, safe-haven assets were down, and stock markets and oil were up. Since we still do not see reasons for optimism, our recommendations remain valid: we are looking for points for buying gold and the Japanese yen within a day, and we are selling the Russian ruble and stock markets in the medium term. As an argument, we will cite information from the head of the Medical School of the University of Hong Kong, Professor Gabriel Lung, who announced the data from which it follows that 10 times more people are infected with the coronavirus than is officially considered. According to him, in Wuhan alone, 25,000 people are infected with the coronavirus, and the total number is 44,000. He predicts that the number of coronaviruses infected in China will double in 6 days. If the markets decide to respond to this information, then we may well become witnesses of what happened on Monday. The only recommendation is that we recommend buying oil as a kind of hedge for other positions that are somewhat unidirectional regarding investor sentiment, as well as an independent, not hopeless position. Now everyone is fixated on one component of the oil market situation - demand. But there is still a suggestion. And in this regard, Libya sends a rather strong bullish signal to the market. We are talking about the possibility of an almost complete stoppage of oil production in the country. According to the head of National Oil Corp. Mustafa Sanalla in the near future production may be reduced to 72 thousand b/d. from the current 262 thousand barrels per day. Meanwhile, the main central bank of the world today will announce its decision on the parameters of monetary policy. With a probability of 87%, the bet will be left unchanged. At the same time, 13% of traders believe that the rate will be increased. Quite symptomatic is the fact that markets do not even consider the possibility of reducing the Fed rate. But unlike the ECB or the Bank of Japan, the Fed still has enough space for this to maneuver. So, they will almost certainly not touch the bid. So, all attention will be focused on the comments of the Fed. What are the plans of the Central Bank for 2020? How long will the money market continue to pump liquidity through repos? Answers to these and other questions can determine the configuration in the financial markets. Today we will not make plans and predict the reaction of the dollar to the outcome of the FOMC meeting. Our plan for working with this currency for today is to stay out of the market, study the position of the Fed and tomorrow will formulate a plan of work with the US dollar.
FX:USOILLong
by Trade24Fx
Effects of the coronavirus grow as panic in marketsThe coronavirus epidemic is gaining momentum. At least, according to statistics. The number of deaths is already close to 100, and the number of cases is close to 3,000. China is forced to react harder. The magnitude of the effects on the economy is growing exponentially. Lunar New Year celebrations are extended for at least 3 more days. Actually, more than one review can be devoted to the chronicles of the coronavirus and attempts to assess their consequences. But we are still more interested in the reaction of financial markets and how to capitalize on this force majeure. Panic in the financial markets after the weekend intensified. The Fear Index (VIX) literally skyrocketed, increasing by more than 40% in a couple of days! So far, everything is developing exactly with our recommendations: safe-haven assets are growing in price, stock markets have rained down, risky assets like the Russian ruble are losing, oil and other commodity assets are continuing to decline. So further deterioration of the epidemic situation will obviously be accompanied by the development of these trends. Therefore, the basic trading plan is still unchanged: we buy gold and the Japanese yen, sell the Russian ruble, sell shares. As for oil (WTI brand), the support we outlined 51.20 +/- is clearly the goal of the current movement. If events will develop as they develop, and the asset will be able to break through this support, then oil sales may well become uncontrolled. But until this happens, 51.20 seems to be a good point for shopping (for aggressive traders, conservative in place, we would wait until the markets calm down). Today, quite important statistics for the United States will be published (orders for durable goods and the level of consumer confidence), but let's be realistic - everyone is not up to it now.
Short
by Trade24Fx
China’s epidemic, Brexit, the ECB, ruble, and oilWednesday was remembered by the next highs in the US stock market. The madness continues, but characteristic is the reluctance of gold to decline against this background. It turns out that buying gold is currently practically risk-free: with an increase in demand for risky assets, it does not fall, but at the same time, any concerns of investors instantly provoke an increase in asset prices. Speaking of investor concerns. The coronavirus epidemic in China seems to be gaining momentum and is at risk of spreading around the world. And although China’s official authorities claim that the situation is under control, there are risks of causing significant economic damage to the Chinese economy. Events take place at the time of the New Year holidays in China, which traditionally attract millions of tourists. In general, the chances of a trend continuing in a slowdown in China's economy are very high. Against such a background, gold purchases continue to be one of our favorite deals to date. Another top deal for us is the purchase of the British pound. The reasons are the same - Brexit is slowly but surely moving towards the implementation of the “soft” scenario, and this is an occasion for the growth of the pound in the region of 1.40. Yesterday, the GBPUSD pair jerked up due to the fact that the House of Lords of the British Parliament approved the Brexit bill. So on January 31, Great Britain will leave the European Union. From February, a transitional period will begin, which will last until the end of 2020. Bank Canals expectedly left the rate unchanged yesterday. However, the Canadian dollar was still under pressure, and the trading tactics proposed by us in yesterday's review worked out 100%. It is a pity that it can hardly be applied today in the case of the euro. The ECB will announce its decision on the parameters of monetary policy in the afternoon. Almost certainly everything will be unchanged. But comments can be quite unexpected. It is about the announcement of the details of the new monetary policy strategy of the Central Bank. As expected, it will include a phasing out of quantitative easing and the era of zero rates. If nothing changes, we do not expect a significant increase in the euro today. Even when changing the strategy of the Central Bank, it’s not about the months, but about the years that will be needed for its practical implementation. Downward pressure has clearly prevailed lately, and aggression on the part of the ECB has not come for years. The Russian ruble continues to decline in the foreign exchange market, but the potential for its reduction has not yet been fully exhausted. It still seems rather vulnerable to us, so we will use any attempts to strengthen the ruble for its sales. Oil yesterday declined quite aggressively and overcame an important level of support, which opens the way to a further decline. Considering that the markets again turned their attention to an oversupply of oil in 2020, we will refrain from aggressive asset purchases for now.
Long
by Trade24Fx
Central Banks week and the IMF head expects a crisisMonday turned out to be a fairly calm day for financial markets. The reason on the surface is a day off in the USA. So today it will almost certainly be more volatile and interesting. The Bank of Japan set the pace to the news background early in the morning. Monetary policy parameters were left unchanged. The press conference will be somewhat later than the publication of this review, so if any interesting details come up, they will talk about them tomorrow. Today will be interesting statistics on the UK labor market. Considering how disastrous the data on the British economy last week was, one should not expect any positive. Nevertheless, we continue to believe that Brexit is the main driver of the pound, and statistics in the current reality can lead only to local movements. Accordingly, weak data, of course, will provoke sales but are unlikely to lead to the formation of a trend. This means that purchases in intraday oversold areas remain relevant to us. Let's get back to the events of yesterday. Perhaps the most significant was the opening of the oil market with a gap up. The reason is concerns about the supply on the market. The fact is that Iraq and Libya drastically reduced oil production. In Iraq, because of protests, in Libya, because of armed groups that blocked the pipeline. And although it is very likely that these force majeure are temporary, we recall our recommendation to buy oil, which continues to be relevant in the current conditions. We also continue to be supporters of the impending crisis, or at least the strongest correction in the US stock market. So it was nice to note the replenishment in our ranks. The head of the IMF, Kristalina Georgieva, in her last interview, compared the current situation to what was happening in the world on the eve of the Great Depression. A key common feature of the 1920s and the present situation is excessive financial squandering. According to the head of the IMF, depression cannot be avoided. The whole question is only in time. In this regard, we recall our recommendations on buying safe haven assets (gold in the first place and Japanese yen in the second), as well as the “trading idea of the decade” - in the sale of shares of high-tech companies in the US stock market.
Short
by Trade24Fx
The US & China, Russian reforms and an oil situationAfter the United States and China completed the first phase of negotiations, the result of which was not as rosy as many expected, the markets decided to take a break and continued to develop existing trends. Note that the current optimism has exhausted itself. But the negative on the horizon more than enough. Only the first step has been taken. Now the parties need to move on and begin the negotiation process on phase number 2. Given that the first phase was an extremely painful process, we are waiting for a problem on the way to the second. Do not forget also that the first phase still needs to be performed. For example, China must buy hundreds of billions of dollars of agricultural products from the United States. Not the fact that he will do it. Therefore, you should not expect a happy ending in the foreseeable future. Accordingly, we continue to look for points for the purchase of safe-haven assets both within the day and in the medium-term - gold and the Japanese yen. The growing pressure on the oil market is largely due to market concerns. Trade wars have shown themselves to be extremely destructive. Their continuation is further damage to the global economy, which in turn will lead to a decrease in oil demand. Nevertheless, we consider current oil prices favorable for intraday purchases (with small stops). The situation in Iran is very unstable; in Iraq, too, not everything is calm. That is, problems with the supply of oil on the market can arise at any time. In the news plan, the most interesting continued to happen around Russia and the Russian ruble. A more detailed analysis of the situation and our recommendation to sell the Russian ruble we will do in a separate review. In the meantime, we note that many experts perceive the dissolution of the Government and Putin's initiative to amend the Constitution as the next qualitatively new level of the usurpation of power. Which in itself is bad, because it deprives at least some hope of a change in the course and manner of behavior of the Russian Federation in the international arena with all the ensuing in the form of sanctions and the role of the rogue state. As for macroeconomic statistics on Thursday, the main event of the day was the publication of data on retail sales in the United States. The data came out exactly as part of the forecasts. Today, in the news plan, it is interesting with data on China's GDP (released as part of forecasts), as well as retail sales in the UK, inflation in the Eurozone and industrial production in the United States. In general, the day promises to be eventful, which means movements in the foreign exchange market and, accordingly, the possibility of earning.
Long
by Trade24Fx
Oil Market iz beginning to look a lot like ChristmasBuyers look towards September month high, sellers await the break of short-term support line for fresh entry. Overbought RSI conditions favor the Bears’ entry. While September month top, near $63.15, seems to be on the Bulls’ radar, May 20 low near $62.60 can act as an intermediate halt during the black gold’s further rise. However, overbought conditions of 14-bar Relative Strength Index (RSI) raise hopes of a pullback towards adjacent support trend line stretched from December 03, at $60.60 now. Should prices slip below $60.60, a fresh decline towards 23.6% Fibonacci retracement of the monthly run-up, at $59.70, can be expected. In a case where energy sellers keep dominating after $59.70, 38.2% Fibonacci retracement and November 22 high close to $58.80/75 will be on their watch-list.
FX:USOILShort
by Shourov_kk
Pound, and we are preparing for the Fed announcementOn December 15, the United States will not increase tariffs on Chinese goods.The reason is that the negotiation process between the US and China continues. The news was supposed to provoke sales in safe-haven assets, but it did not happen. That only confirmed our recommendation to look for points for buying gold and the Japanese yen on the intraday basis. Another quite revealing statement yesterday was the growth of the pound after frankly weak macroeconomic data came out: GDP, industrial production, and the trade balance were worse than expected and were generally weak (GDP growth at minimum levels since 2012). Nevertheless, the pound, as a result, did not decline but even strengthened. The reason is the same - markets expect a conservative party to succeed in the Thursday elections and the subsequent “soft” Brexit. We continue to recommend buying the pound. The key event on Wednesday will be the announcement of the decision of the Federal Open Market Committee on the parameters of monetary policy in the United States. After the publication of data on the labour market in the United States last Friday, it became clear that the Fed would not lower or raise the rate. Thus, the probability of maintaining the status quo is 98%. Therefore, do not count on strong movements in dollar pairs today. Accordingly, our trading tactics for the dollar today are unchanged - we will continue to look for opportunities to sell the dollar. As for the oil market, despite the data on the growth of oil reserves in the United States (figures from the API showed an increase of 1.41 million barrels, official statistics from the US Department of Energy will be published tonight), we continue to consider oil purchases in the current conditions quite pe promising trading idea.
Long
by Trade24Fx
Time "X" is getting closer, Boris may be celebrating his victoryIn yesterday’s review, we already noted that this week may be decisive for several financial assets, and the global economy as a whole. On December 15, the United States may introduce tariffs on goods from China and thus bring trade wars to a new level. It's entirely up to an agreement between the parties. Even though we have heard positive statements for more than a month, the situation looks more and more menacing day by day. Although the probability of the successful completion of the first phase of trade negotiations between the United States and China is quite high, we will continue to look for points to buy safe-haven assets today. This recommendation will remain relevant until the actual conclusion of the contract. Meanwhile, in the foreign exchange market, is getting ready for Johnson's victory in parliamentary elections in the UK. According to recent polls, the Conservative Party will be ahead of the Labor Party by at least 10%. Recall, for Brexit, this means the end of the story - Johnson will be able to present his version of the deal Britain will finally leave the EU with the deal. For the pound, this is a powerful fundamental positive background. In this regard, we continue to recommend the purchase of the pound. It may well grow in the foreseeable future by several hundred pips. Since we are talking about the pound, we note that today will be published statistics on the UK. So you need to act with an eye on the data on GDP, trade balance and industrial production. Speaking of our other trading ideas for today, they are unchanged. Oil purchases still seem like a great idea to us in light of the latest OPEC + decision. Dollar sales are also promising.
by Trade24Fx
1
Strange last week, the OPEC decision & near futureThe reasons for the markets getting out of “hibernation” are an active news background interspersed with the news. Recall, it was launched by Trump's decision to impose tariffs on steel from Argentina and Brazil and at the same time accuse these countries of currency manipulation. What was perceived by us as an expansion of the trade war and a possible beginning of the currency war. Well, the week ended with the publication of statistics on the US labour market, as well as the completion of the OPEC meeting. Let's start with statistics on the US labour market. Honestly, it surprised us. The numbers came out abnormally high for the current reality of the US economy (+ 266K with a forecast + 180K). Also, the unemployment rate fell to its record low marks (3.5%). The growth of the dollar against the backdrop of such excellent data was logical. But, given the anomalous nature of the given data, we would not be in a hurry to conclude. At least one more confirmation is needed that + 266K is not a coincidence, but a pattern. So on Monday, we will rely on local profit-taking in the dollar after Friday's growth, and therefore we will look for points for its sales. Note that on Friday our recommendation for news trading in the USDCAD worked out perfectly: excellent US data overlapped with bad figures on the Canadian labour market, as a result, the USDCAD soared by 100 points. Perhaps the most important event in terms of the consequences of the past week was OPEC’s decision to further reduce oil production from 1.2 million to 1.7 million from January 1, 2020. So, we can talk about the OPEC + agreement №3 (recall, the first one, provided for a reduction of 1.8 million barrels, the second one 1.2 million barrels per day). At the same time, Saudi Arabia made an unexpected statement of readiness on its part to further reduce production by another 400 thousand b / d. That is, the total reduction may reach 2.1 million barrels. This is the highest reduction since the cartel's attempts to stabilize the situation in the oil market. Despite the rather modest oil growth on Friday, such an outcome of the OPEC meeting is a very strong bullish signal. So this week, we will look for points for oil purchases. It would seem that after such a busy week the markets need a break, but you should not count on it. This week promises to be even more volatile. Key events are the announcement of the Fed decision on monetary policy parameters in the US, the ECB in the Eurozone, as well as elections in the UK. And although both events seem relatively predictable, there is enough time for surprises. How to make money on each of this news we will write a bit later. As for our positions, we do not see any reason to change our basic strategy (except oil). Therefore, we will continue to buy safe-haven assets (gold is simply perfectly substituted), sell the dollar, and this week we will actively build up a long position on the pound - the victory of conservatives in the UK parliamentary elections will have to hit the pound higher. we will buy oil.
Long
by Trade24Fx
1
OPEC meeting, Bank of Canada decision and Eurozone GDPWe start with macroeconomic statistics, it is worth noting the extremely weak employment rate from ADP: +67 thousand jobs with a forecast of +135 thousand. So, buyers of the dollar should at least focus, because if similar statistics come out on Friday on the NFP, the dollar may well be sold out. Statistics on business activity in the Eurozone came out surprisingly good, which intensified the talks that the European economy was beginning to recover. The pound also got its reason for growth, as the UK business activity index also exceeded forecasts. Although we note that it was still below 50. It is rather symptomatic that the pound continues to grow without waiting for the election results. The markets decided that Brexit’s fate is predetermined (there will be no way out without a deal), but the pound is still very cheap, you need to buy it before it’s too late. We have long been bulls as for pound, so nothing surprising happens to us. We only note that a daily close above 1.30 is a strong bullish signal. And the pound may grow more than one hundred pips. So we are looking for points for his purchases. The Bank of Canada did not change the rate yesterday but was quite optimistic in its comments, which contributed to the growth of the Canadian dollar. So those readers who were following our recommendations could put in their piggy bank a good profit. Despite the extremely frightening information at the beginning of the week, the negotiation process between the US and China continues. And according to its participants, by December 15, the first phase should be completed. As for today the macroeconomic statistics, the news of the day will be the publication of Eurozone GDP. The fact may likely be higher than forecasts. This means that the euro may well strengthen up to 1.1160 paired with the dollar. Well, the main event of the week, at least for the oil market, will be the beginning of the OPEC meeting in Vienna. The most likely scenario is an attempt to leave everything as it is. That is, they will adhere to the current line of behaviour (an agreement to reduce production by 1.2 million b / d). For oil, this decision, by and large, does not change anything in terms of fundamental alignment. But any agreements to increase the limits will play into the hands of buyers and vice versa. Refusal of the deal in any form will be a strong hit to oil and activates its sellers.
TVC:DXYShort
by Trade24Fx
US records, Trump irritates Sino & Johnson is ready to celebrateMost Americans, as well as financial markets, received the day off from work on Thursday, therefore, we can focus on other financial markets. In today's review, we will focus on the oil market. Recall that next week the OPEC meeting should be held, which could potentially change the existing balance of forces in the oil market. But we will talk about this meeting later. Now let's focus on the current state of affairs. Oil growth last week was highly dependent on optimistic news about the progress in negotiations between the US and China. Accordingly, traders worked out a possible increase in demand in the oil market. But, as we already noted in the previous reviews, the markets are already tired of promises and waiting for results. Accordingly, oil growth stopped. The participants in the oil market can be understood, especially considering that Trump has nevertheless signed a law to support protesters in Hong Kong. Potentially, this could cause a new round of escalation in relations between the USA and China and another breakdown of the negotiation process between the countries. At the same time, statistics from the US come out bearish. First of all, it is about the USA reaching a new record in oil production: 12.9 million barrels per day. The result was an increase in US oil reserves, which in aggregate puts pressure on oil quotes and not only does not allow the asset to grow but also pulls it down. Our position in oil is as follows: we look for points for selling the asset on the intraday basis and sell oil in the medium term (current prices are quite favourable for this). But lets back to other news and markets. According to a YouGov poll, conservatives will win and get the vast majority in the December 12 elections in the UK. This means that Johnson will have every opportunity to ratify his Brexit deal. Thus, the probability of exit without a deal has become even more insignificant. For the pound, this is undoubtedly good news. Recall that its growth potential is far from exhausted. We are talking about 500-1000 points of the possible growth of GBPUSD. So we continue to recommend buying a pair.
FX:USOILShort
by Trade24Fx
Trump helps safe havens and puts pressure on the dollarYesterday against the positive comments from the US and China regarding trade negotiations, safe-haven assets were under pressure. That is not surprising. Recall our position on gold and the Japanese yen – is to buy, however, now we should trade with an eye to a possible surge of optimism in the financial markets against the background of breaking news from Washington. Nevertheless, such descents of safe-haven assets should be tried to be used for short-term speculative trading with small stops. Yesterday is a vivid confirmation of this. The meeting between Trump and Fed Chairman Jerome Powell provoked the sale of the dollar in the foreign exchange market and led to an increase in gold prices. The reason is Trump's comments on negative rates and a strong dollar, which were discussed at the meeting. So there is nothing new: Trump consistently opposed the strong dollar and ultra-low rates. So nothing extraordinary happened yesterday. Another important news is the information about the IPO Saudi Aramco - on the one hand, it is the largest public offering in history (company's capitalization), and in addition, this event is important for the oil market. So, $ 2 trillion of capitalization seems to remain in the dreams of the Crown Prince of Saudi Arabia. Preliminary estimates are $ 1.6- $ 1.7 trillion. Which, however, will still make the company the most expensive in the world. Regarding the situation in the oil market, despite the desire of the Saudis to conduct an IPO in the most favorable conditions (rising oil prices), as well as the continued decline in the number of active oil wells in the United States, we believe that current oil prices are close to extreme for of these conditions, which means we will sell oil both on the intraday basis and in the medium term. But do not forget about the stops. A breakthrough in negotiations between the US and China could provoke not only sales in safe-haven assets, but also an increase in oil prices. Our other trading preferences are unchanged - the Russian ruble can and should be sold. The US dollar is also interesting enough to open short positions, especially after yesterday's sales. The pound feels rather confident in the foreign exchange market in light of the growing confidence of the markets in the victory of the Johnson party in the elections, but we are interested in its purchases on the slopes, and not along the way. So we will wait until the pound is substituted, and only then buy it.
FOREXCOM:XAUUSDLong
by Trade24Fx
Trump attacks Fed, UBS expects pound to riseUnfortunate week for oil buyers. Following the news about a possible increase in supply and weak demand growth in the future, as well as Morgan Stanley's forecasts about a 25-30% reduction in market prices. Another disappointing news. The agency’s World Energy Outlook (WEO), published that oil demand peaks within the next 10 years. Recall that this week Saudi Aramco gave the oil market 20 years. According to IEA analysts, the current growth in oil demand will last for 5 years maximum, and then we will see a significant slowdown. We are talking about long-term forecasts, so now oil may well ignore these estimates. But in general, the future of the oil market looks rather unsightly. As for yesterday’s oil growth, it was largely due to verbal interventions by the OPEC Secretary-General, who tried to smooth out the effect of the above-mentioned news. In particular, he said that in 2020 growth in oil demand could beat forecasts, oil supply from non-OPEC producers could decline sharply soon. Despite the growth of oil yesterday, taking into account current prices in the market, we continue to recommend selling the asset. Also, despite the strengthening over the last couple of weeks, we recommend selling the dollar. The further fate of the Fed rates is still in limbo, but the further decline will be a strong hit to the dollar. In this light, Trump's next attack on the Fed was quite remarkable. The US President accused the Central Bank and Powell of slowing down the economic development in the States. The Fed, unlike other leading central banks, did not want to divert rates into the negative zone, which harmed the US economy. Such information at a time of the impeachment procedure, Trump gives reasons for the sale of the dollar. Moreover, you can sell it against euro, pound or Japanese yen. Also, the Canadian dollar in the region of 1.33 seems to be a good candidate for buying USDCAD (we are talking about the sales of this pair). The British pound is another excellent candidate for purchases against the dollar. We have already noted that in conditions of an almost complete absence of risks of a “no-deal” exit, the current prices for the pound seem to us underestimated by at least 500-1000 points. According to the updated forecasts from UBS, our estimates are still very conservative. Since bank analysts see the pound paired with the dollar in the region of 1.54 over the next three years. Since we are interested in the time horizon in months, not years, the achievement of 1.40 with GBPUSD will completely satisfy us. Returning to the situation with the dollar, we note that yesterday's data on consumer inflation in the US as turned out to be rather neutral and did not change the existing situation in the foreign exchange market. Today we are waiting for GDP data in the Eurozone and Germany, as well as for retail sales in the UK. Besides, the attention of the markets will be riveted to the speech of Fed Chairman Jerome Powell to the US Congress.
Long
by Trade24Fx
Bad for oil and good for poundYesterday marked of news regarding the oil market and its prospects. Moreover, this news has a one-sided impact in terms of the impact on oil quotes. On the supply side, we have a message about the discovery of a huge oil field in Iran. It is about 50 billion barrels. To understand if it is a lot, let’s have a look at the statistics. Proved oil reserves in Iran rank fourth largest in the world (150 billion barrels). Accordingly, 50 billion = 30% will be added to existing stocks. That is a lot. It should be noted that while Iran is under sanctions, that is an accumulated potential than a real injection of additional supply on the market. But from the perspective of a market development strategy, the signal is undoubtedly bearish. Especially when you consider the news that Global oil demand may peak within the next 20 years, according to an assessment included in the prospectus for Saudi Aramco's initial public offering and, and further it will only decline. This news does not solve much in terms of supply/demand. But the prospects look extremely alarming for oil buyers. Sum up, in the short term, this news does not have that much impact. But in the long term, the oil market looks increasingly vulnerable. Knowing the markets and their general timidity, we will refrain from buying oil at current prices and will prefer its sales on the intraday basis this week. Until it becomes clear that investors and traders are fully aware of the situation. Yesterday, the foreign exchange market was relatively calm. The only exception is the British pound. Moreover, the reason for its splash was not macroeconomic statistics, which would be logical, since the data were published very important (GDP and industrial production), but traditionally news regarding Brexit. Nigel Farage has said the Brexit party will not field any candidates against the Conservatives in the 317 seats they won at the last general election. Motivation is the desire to prevent a second referendum on Brexit. The pound on this news naturally grew, since the chances of a “soft” Brexit increased. However, we believe that in the current political situation, any “scenario” play into the hands of the pound. So its purchases, in our opinion, remain relevant. Our idea is confirmed by yesterday’s reaction of the pound to rather weak macroeconomic statistics. Industrial production in September fell by 0.3% (forecast: -0.1% m / m), and GDP for the third quarter grew by only 0.3% (forecast: + 0.4%), and the state of the trade balance significantly worsened ( -12.541 billion against -10.825 in August). However, the pound has grown steadily We also do not forget to sell the Russian ruble, which again trades above 63.50, hinting that paired with the dollar its next target is 65.
Long
by Trade24Fx
USA and China, Saudi Aramco and Bank of EnglandThe previous week, promised to be relatively calm, however, it turned out to be eventful. Gold and the Japanese yen were under downward pressure. The reason is the progress in negotiations between the US and China as well as the growth of positive market expectations regarding the end of trade wars in the foreseeable future. The main result of the week was the news that the United States and China agreed on a phased cancellation of duties before signing a deal. Another event was a separate decision by the Bank of England to leave the rate unchanged. Markets did not expect two members of the Monetary Policy Committee to be in favour of a rate cut. That triggered a decline in the British pound value. In general, you should not expect strong movements in the pound, because the basic driver of pound value in the last 3 years is Brexit. But it is paused so far. So any movement caused by news not related to UK exit will be limited. Due to the large amounts of macroeconomic statistics, the future of the pound looks very vague. On Monday, data on GDP and industrial production in the UK will be published, on Tuesday - statistics on the labour market, on Wednesday - inflation data, on Thursday the data on retail sales will sum up the week. Since the dynamics of the pound, this week will depend on the output data, we will adjust the positions depending on the nature of the data. At the same time, we do not expect irrationality from the foreign exchange market. That is, weak data will provoke sales in pound pairs, and positive statistics data will be the reason for the growth of the pound. Total, this week in the pound we will act contextually, but we give preference to its purchases. On the other hand, we have a very definite position in the oil market - we will look for points for asset purchases. Saudi Arabia in connection with the impending IPO Saudi Aramco will do anything to ensure the growth of oil prices. Latest data on the number of active oil rigs in the United States (the number has dropped to the lowest marks since April 2017) play into the hands of buyers. So we buy oil on the intraday basis. The goal is the growth up to 60.
Long
by Trade24Fx
Data helps the dollar, optimism in financial marketsIn our previous review, we noted that the publication of the ISM index of business activity in the US services sector will be the main event. The ISM index of business activity in the services sector reached 54.7 in October (analysts expected 53.5, before 52.6). As a result, the USD strengthened. “I think it’s a good time though to pause...and that’s what I am looking to do,” Barkin (non voter)told reporters following a speech to an economic outlook conference in Baltimore was another impulse. It seems that the majority of the Fed feels that way. According to the Chicago Mercantile Exchange, markets also expect a pause until September 2019, the probability that the rate will remain at the level of 1.50% -1.75% exceeds 50%. As for the USD, Tuesday turned out to be rich in bullish signals. Despite this and yesterday’s growth, we do believe that the potential for its further strengthening is limited. Therefore, we will continue to look for points for its sales across the entire spectrum of the foreign exchange market, both on the intraday basis and the medium term. China deal is likely to be signed in November so markets are optimistic about that. The confidence that by the end of this month we will see the first signed agreement is getting stronger, so safe-haven assets weaken and commodity markets grow. Take oil, for example. OPEC sees its oil market share shrinking, Forecasts are generally negative for oil prices - the Cartel expects a significant decrease in oil demand growth in the foreseeable future. However, oil strengthened yesterday at the end of the day - expectations of progress in trade negotiations overcame fears of a surplus in the oil market. So our recommendation to buy oil on the intraday basis remains relevant. As for the safe-haven assets, the downward pressure is increasing, and they are close to hitting the critical points, after that the further reduction in the price of gold and the Japanese yen is quite possible. On the other hand, their current prices look ideal for purchases. So today we will buy gold and the Japanese yen with small stops. Today, in terms of macroeconomic statistics, we are waiting for statistics from the Eurozone (a lot of business activity indices, as well as retail sales data) to come out.
by Trade24Fx
Brexit postponed, last quiet day of the weekThe Brexit date is set to be delayed until 31 January Again. Johnson, as promised, asked parliamentarians to call early elections in December. He has failed to win on Brexit. Johnson said that he would make another attempt today and said that without early elections, it would not be possible to ratify the agreement with the EU. Today will be the last relatively calm day in the foreign exchange market, because on Wednesday the Fed and the Bank of Canada will announce their decisions, on Thursday we expect news from and the Bank of Japan, well, on Friday we are waiting for data on the US labour market to come out. So it will be an extremely interesting and volatile week. But we will talk about these events as they approach. And today we suggest focusing on trading using the stochastic oscillator. That is, we trade without obvious preferences according to the signals from hourly oscillators - we buy in the oversold zone and sell in the overbought zone. But at the same time, we do not try to impose our will on the market and fix our positions with relatively small stops. List of our current trading preferences as follows: selling the dollar, buying gold and the Japanese yen, selling the Russian ruble and buying oil on the intraday basis. -Some of the positions may change their direction, so new prospective options could be added. For example, purchases of the Canadian or Australian dollars against the US dollar. The only thing that keeps us from actively recommending the purchase of commodity currencies is their approach to important levels. The Canadian will have a chance to hit the key support on Wednesday when the results of the meetings of the Bank of Canada and the Fed will be announced. The Australian dollar may take advantage of the possible sale of the US dollar on Wednesday after the Fed’s decision and also gain a foothold above 0.6880.
Long
by Trade24Fx
Get ready for Fed decision, Brexit & bullish oil marketBrexit was accustomed to being the main news generator last week, at least for the pound pairs. Parliament refused to vote for the deal until it made changes to British law, which meant the need to request a postponement. In our opinion, this is just a way to publicly humiliate Johnson, who has repeatedly said that October 31 will be the end date. As a result, Johnson sent a letter to the EU asking for a postponement, but “forgot” to sign it. In the EU, instead of a postponement, decided to wait until the British agreed on something. It is all about the special election. On Monday, this issue will be put to a vote in Parliament. In general, the week will be hot for the pound from its very beginning. Well, the date of October 31 is Thursday of the current week. So get ready for the sharp spike in pound volatility. Generally, we remain bulls on the pound - the issue of leaving without a deal is practically removed from the agenda, so this is a sign for buying the pound. But its decrease by several hundred points against the background of negative news from Parliament / Government of Great Britain or the EU is quite possible. So do not forget to put stops and monitor the news background. The current week for all other participants in financial markets (except the British) will be interesting first of all by announcing the Fed's decision on the interest rate on Wednesday. The current consensus - lowering the interest rate, and then will put the process of changing rates to a pause at least until the end of the year. We’ll talk more about this on Wednesday before the event. Unexpected for the markets Central Bank of Russia decreased the interest rate by 0.5%. Given that the ruble came close to our settlement point No. 1 for the sale of the ruble, we recommend opening long positions in the USDRUB from current prices in the region of 63.60 with a minimum target in the region of 65.20. The second round of purchasing starts at about 62.60. And a few words about the oil market. Formally, our recommendation to buy in the region of 51.20 with goals 56 last week worked out completely. Knowing how events are developing, there is a chance to raise the growth target - oil may well reach 60 (WTI brand). According to Baker Hughes, the number of oil rigs in the United States fell by 17 to 696 units. Thus, their number has fallen to its lowest level over the last 2.5 years. Recall, last week, US oil inventories decreased by 1.7 million barrels. So this week we are looking for points for oil purchases. The goal until the end of the week is 60. But at the same time, do not forget to set up small stops.
FX:USOILLong
by Trade24Fx