30/09/2019

 

IMPORTANT DISCLAIMER

The information of this report is of a general nature only. It is not a personal financial advice. It does not take into account your objectives, financial situation and personal needs.

a-Quant is not responsible for your actions and recommends you contact a licensed financial advisor before acting on any information contained in this general information report.

 

EURUSD

EURUSD moved above 1.0950 in the beginning of last week with a bullish reaction in this area, up to 1.1025, giving us some profits by following the range trading strategy. After Wednesday though, there was an important drop and the price touched the area of 1.09 (we hadn’t seen such prices since the spring of 2017) and finally it closed on Friday at 1.0939, very close to 1.0950. European financial news last week was not positive and encouraging so EUR had important pressures and the USD rally would carry on even with a bigger tension if we didn’t have some political news in USA regarding Trump’s possible impeachment and the turmoil on the trade war between USA and China. The current week contains very important periodical financial news & announcements for Europe and USA which in combination with the above could be the necessary fuel for a further drop of EURUSD, so we’ll favour sell positions with targets below 1.09, maybe to the area of 1.0830. The most important of news & announcements are the Unemployment Change in Germany on Monday 10:55, ο δείκτης τιμών καταναλωτή της Γερμανίας τη Δευτέρα στις 15:00, the Eurozone Consumer Price Index on Tuesday, ISM PMI Indicator for US Employment and Manufactures on Tuesday, the USA Mortgage Application on Wednesday, Eurozone Retail Sales on Thursday, the US ISM Non-Manufacturing/Services ISM PMI Index on Thursday and above all the NFPs & US Unemployment announcements for September on Friday which is the most important periodical financial announcement. This week closes with the important speech of Jerome Powell (FED) late on Friday.

 

GBPUSD

GBPUSD started last week with a drop, moving above 1.24, followed with a strong bullish reaction on Tuesday up to the area of 1.25 but after Wednesday the trend became heavily bearish leading the pair significantly lower. Finally, GBPUSD closed at 1.2288, a bit higher of the weekly lows at 1.2270. This drop be due to Michael Saunders’ (Bank of England) statement that had to do with a rate cut as a possible monetary policy movement for the next period amid the Brexit uncertainty. Moreover, we had Boris Johnson’s statements who insisted on the Brexit by the end of October by saying that he does not want any extensions. The pair’s drop is expected to be continued in the current week so we’ll open sell positions targeting the price area of 1.22, or even the price area of 1.2130. However, the fact is that as we approach to the deadline of October, even some dim rays of light regarding Brexit could move GBPUSD significantly higher. Besides the US news for the current week that we saw above at EURUSD section, there are important news for UK as well: GDP announcement for Q2 on Monday, Housing Prices on Tuesday, Manufacturing PMI on Tuesday, Markit Construction on Wednesday and Markit (Composite & Services) PMI on Thursday. Of course, we should pay extra attention on Friday and NFPs announcement which will cause high volatility for the pair.

 

USDJPY

USDJPY started with a heavy bearish trend last week, reaching the price area of 107 but after Wednesday we had a total trend reversion up the price area of 108. This uptrend continued on Thursday & Friday until 108.18 and finally the week closed at 107.91. This bullish reaction could be even stronger but the rumours regarding removing the Chinese stocks from the US stock market broke the bulls. The point is that the statements of US officer during the weekend disproved and refuted this news and so the risk averse mood maybe will have a comeback, pressing the pair lower. We’ll favor sell positions this week with major target the price area of 107.30. Beyond the periodical USA news that we saw above at the EURUSD section (most important is the NFPS on Friday), the most important news for the Japanese economy this week include the Construction Orders on Monday, the Unemployment Rate and  the Non-Manufacturing Indices on Tuesday, the Monetary Base on Wednesday, the Consumer Confidence Index on Wednesday and the Bond Investment & Foreign Investment in Japan Stocks on Thursday.

 

EURJPY

Last week was heavily bearish for EURJPY, excluding last Friday where we saw an important bullish reaction. More specifically, the open of the week was at 118.78, we had a weekly low at 107.44 during Friday morning and the bullish reaction lead the pair to 118.47. Finally, the week closed at 118.09. Despite the Friday’s bullish reaction, weak EUR seems to dominate by driving EURJPY to a bearish channel so we’ll open sell positions this week targeting the area of 107. Scheduled European and Japanese economies news are mentioned above at EURUSD and USDJPY sections respectively.

 

EURGBP

Last week was the first week with a bullish reaction for EURGBP after the heavy downtrend movements since 12/8. The pair closed at 0.8896, very close to weekly high at 0.8904 with important profits of 1%. The uncertainty caused by the Brexit by pressed GBP and this fact dominated the weak EUR, driving the pair at the price area of 0.89. Weekly close though below 0.89 shows that the bullish reversion has not been solidified yet. The Eurozone economic issues and the fragile environment around Brexit, give us serious concerns regarding EURGBP trend this week. We expect to see uncertainty and sideways movements so we’ll avoid taking any positions. European and UK financial news are mentioned above at EURUSD and GBPUSD sections respectively

 

USDCAD

Last week was slightly bearish for USDCAD: it opened at 1.3259 and it closed at 1.3248. During the week the pair moved into a range between 1.3213 and 1.3304 but we had the weekly lows on Friday after the news regarding Donald Trump and his impeachment. The situation in Middle East seems to be improved (at least for the moment) and so USDCAD is expected to be affected from the usual factors. There is a price squeeze the last weeks on USDCAD range and this fact could lead to a price explosion with the most possible direction to favour the bears. We’ll follow this estimation and in combination with our Machine Learning models we’ll open sell positions targeting the price area of 1.3170. Pay special attention on US news this week and most of all on Friday and NFPs because the volatility of the pair will increase significantly. Other news regarding the economy of Canada include the Industrial & Raw Material Price Index on Monday, the very important announcement for the Canadian GDP for July on Tuesday and the Manufacturing PMI Index on Tuesday.

 

USDCHF

Last week was slightly bullish for USDCHF, which closed above 0.99, at 0.9908. The week had started with a bearish trend though down to 0.9843 but the big bullish movement that lead the pair up to the price of 0.9948 on Friday stopped due the US news & Donald Trump and his troubles with the law. Even this slight bullish close above 0.99 preserves the positive outlook for the pair and warms the flirt with 1:1 again this week, while some rumours regarding the Chinese stocks and the US stock market do not seem to stand. We’ll open buy positions with main target some pips below 1:1. Financial news regarding the Swiss economy this week, mostly include the announcement of KOF Leading Indicator on Monday, the Real Retail Sales on Tuesday, the Purchasing Managers’ Index on Tuesday and the CPI Indices on Wednesday. Important news as well in USA this week with NFPs on Friday as the major volatility increase factor.

 

AUDUSD

Last week was bearish for AUDUSD as expected even if the weekly close was at 0.6738, just 6 pips below the weekly open. The weekly range was also low since the pair moved into a tight channel between 0.6738 and 0.6805. It very possible to see a continuation of the bearish movement for AUDUSD this week too so we’ll open sell positions with a main target below 0.67, at the price area of 0.6680. The price drop of commodities pushed lower AUD and the strong USD favours a further price drop for the pair. Chinese PMI early this week did not give any special optimism signs and the rest financial news that are going to affect AUD is the Commonwealth Manufacturing PMI on Tuesday, the very important RBA Rate Decision on Tuesday and the PMI Indicators on Thursday. Note that next Wednesday is a Chinese National Day and a public holiday which may favour low volatility and spikes this day. Of course, we pay special attention to the US news this week with a dominating event the NFPs on Friday.

 

SP500

SP500 lost more than 1% last week, closing at 2,966 points while during the week we saw a low at 2,944 points. The bullish reaction last Wednesday up to 2,990 points was temporary without duration so we had a further price drop during Thursday & Friday. Our Machine Learning models advise for a further drop this week so we’ll open sell positions, targeting the price area of 2,930 points.

 

DAX30

DAX30 had a loss close to 1% last week after a barrage of bad news for German economy. Index had its weekly lows on Wednesday at 12,138 points but we had a bullish reaction on Thursday & Friday which shows that this drop was maybe temporary. If the bullish reaction is established, we’ll open buy positions targeting 12,400 points or even higher at 12,440 points.

 

FTSE100

Quite bullish was the last week for FTSE100, with profits more than 0.7% and a weekly close at 7,407 points even if the Index during last Friday had touched 7,450 points. The very first two days of last week were bearish though, with a stronger drop during last Tuesday. News regarding Brexit, the strong drop of GBP and our Machine Learning models favour a further bullish trend for FTSE100 so our buy positions will have a main target the price area of 7,500 points.

 

Gold

Last week we had serious losses for Gold, more than 1% even if until last Wednesday we had a strong bullish trend and serious profits above the price area of $1,535. Last Wednesday’s close though lead the price close to the area of $1,500 and during Thursday & Friday the bears carried on leading the price a bit above $1,486. Finally, the week closed near $1,497, below the very important resistance of $1,500. The risk mood after the global outlook saturation is expected to cause more sells for the Gold so we’ll open short positions with main target $1,480.

 

US Oil

Further drop for US Oil prices took place last week as we had expected since the situation in Middle East seems to be relieved and we have a reinstatement at the oil production in the attacked areas. The big price drop, more than 5%, brought US Oil prices again to the price zone before the attacks with a weekly close at $56.03. Driven by this ascertainment and with the given price range the weeks before the attacks, most likely we’ll have this week a slight bearish and consolidation behaviour into the price channel between $50 and $55 and we’ll take advantage of it by applying the range trading strategy (sell close to $55 and buy close to $50).