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ATFX Market Update - 2019.02.20

Feb 20 2019, 09:36 AM (+06) | ATFX

Personal opinions today

The Eurozone economic sentiment index and UK job data improved, boosting the euro and the pound. In addition, last night, another US Federal Reserve officer also said that expecting the US economy to slow down in the first half of the year, this year's inflation may be less than 2%, suggesting that the Fed should slow down, or consider stopping interest rate hikes. The comments further affected the dollar's confidence and the dollar to fall. The market is waiting the Fed's monetary policy minutes tomorrow morning, it seems the dollar is facing downside risks. If the Fed’s monetary policy minutes show that most officers do not agree to stop raising interest rates, it is expected that the dollar will rebound. After all, the euro zone political and the Brexit unresolved. The euro and the pound may facing downside risks, changing the recent dollar performance.

Today, it is expected that the Eurozone German Production Price Index and UK industrial order data will affect the Euro and the British Pound before the evening of Beijing time this afternoon. If the European data shows weakness, it is possible to adjust the euro ,the Swiss franc and the British pound. No important US data has been released tonight, and investors are waiting for the minutes of the Federal Reserve’s monetary policy meeting at 3:00 am tomorrow. It will affect the short-term fluctuations and the US dollar. In addition, the US crude oil inventory report will be released tomorrow morning, and the increase or decrease in inventory will affect the fluctuation of crude oil prices and the trend.

Today's suggestion:

1.1365/1.1380 resistance
1.1335/1.1310 support
The Eurozone economic sentiment index improved and supported the euro exchange rate. In addition, there are Fed officials predicting that the US economy will continue to stabilize or slow down, and the pace of interest rate hikes can be slowed down. It is even recommended that the Fed stop raising interest rates this year. After the remarks, the dollar fell, boosting the euro. However, it is estimated that the economy in the first quarter of the euro zone is still weak. The uncertainty of the Brexit, dragging down the economic development of Europe, will likely limit the euro's rise. Technically, the euro has tried the resistance of 1.1355. The trend seems to be optimistic, but the euro zone faces a lot of economic and political problems. If the resistance is broken, the upside may be limited, and the euro will facing the reversing risk. Please pay attention.

1.3080/1.3100 resistance
1.2950/1.2935 support
A number of Fed officers suggested that the Fed should stop raising the interest rates and the dollar fell. In addition, the British Prime Minister visited the European Union and discussed to amend the Brexit Act. The news stimulated and boosted the pound. However, the European Commission has indicated that the Brexit Act has no room for modification. There is uncertainty in the Brexit issue again. The pound is still weak and the rebound may be limited. If the fundamental unchanged, or even worse news, the pound against the dollar may reverse, there will be a chance to return to 1.28 level. The current important reference resistance as 1.3100.

1.0030/1.0050 resistance
0.9990/0.9970 support
The Swiss franc trend followed the euro and the dollar fell against the Swiss franc. Technically, the US dollar has been consolidated against the Swiss franc in the 1.0095 or 1.0120 resistance range. Adjusted the wave by 73.6%. It is estimated that after falling below the 1.0015 support level, the US dollar against the Swiss franc is expected to test 0.9990/0.9970 support, but must pay attention to the development of the euro. Afternoon European data and the minutes of the Fed meeting tomorrow morning, investors watching, may affect the Swiss franc trend.

110.90/111.15 resistance
110.65/110.50 support
The economic data released by Japan this morning was weak and the yen fell. In addition, the market is in this week's Sino-US trade consultation, expecting the negotiations to bring further results, and the market investment atmosphere is strong. The US Dow and the Japanese stock market Nikkei are improving, and the dollar has benefited from the yen. If the Asian stock market performs strongly during the day, it is estimated that the USD/JPY will have the opportunity to continue to test the 111 level. Technically, USD/JPY is short-term focus on 110.50 important support.

0.7175/0.7195 resistance
0.7140/0.7125 support
Yesterday, the Reserve Bank of Australia meeting minutes announced that the Australian dollar may be under pressure, once tested 0.7105. But the Fed officials’ comments made the dollar fall and boosted the Australian dollar. In addition, the market expects China-US trade consultation this week, expecting to achieve further results, rising industrial commodity prices and boosting the Australian dollar. It is recommended to pay close attention to the progress of Sino-US trade negotiations. However, it must be noted that the US Federal Reserve meeting minutes, policy content can not be ignored, may make the Australian dollar against the US dollar adjustment.

0.6880/0.6900 resistance
0.6850/0.6830 support
Last week, Sino-US trade consultations made progress, and the market waited for the next round of meetings and consultations between the two sides in Washington this week. The current investment sentiment is improving, and the New Zealand dollar is expected to continue its upward trend. However, the performance of the Australian dollar against the US dollar often indirectly affects the short-term fluctuation of the New Zealand dollar, which is worthy of reference In addition, it is recommended to pay close attention to the progress of Sino-US trade negotiations and the Fed's monetary policy record tomorrow morning.

1.3235/1.3250 resistance
1.3195/1.3180 support
The Fed’s monetary policy comments made the dollar further lower. In addition, crude oil prices rose, supporting the Canadian dollar. The US crude oil inventory report to be released tomorrow may lead to new developments in crude oil prices, and it is recommended to pay attention. Technically, the US dollar against the Canadian dollar is expected to test 1.3195 as an important support level. Look back at the crude oil price and the Fed's monetary policy meeting minutes.

0.8720/0.8735 resistance
0.8665/0.8650 support
The British Prime Minister visited the European Commission to discuss the amendments to the Brexit Act and boost the performance of the British pound. The pound strengthened and the euro fell against the pound. Technically, the euro is expected to be supported at 0.86 against the pound, with resistance at 0.8720 and 0.8735. The main concern is the result of the British Prime Minister’s discussion with the European Commission.

1.1370/1.1390 ​​resistance
1.1340/1.1325 support
A few days ago, this analysis pointed out that the euro zone was affected by Spain's early elections, the euro's performance was still weaker than the Swiss franc, and the euro against the Swiss franc continued to develop. Technically, you can focus on 1.1330 and 1.1315 support. Since the euro zone economic sentiment index improved yesterday, the euro has a chance to strengthen, the euro against the Swiss franc has the opportunity to test the resistance of 1.1370 and higher. Looking at German economic data today, the data may affect the euro and affect the adjustment.

1345/1348 resistance
1338/1335 support
The Sino-US trade negotiations have made progress, and the relationship between the two countries has further improved, stimulating the rise of global stock markets. In theory, the global stock market investment atmosphere will improve, and there will be downside risks to gold and silver prices. However, the influence of the Fed’s official dovish speech, the monetary policy stance, and the dollar index fell, which caused the price of gold to rise. At present, we are paying close attention to the speeches of other Fed officials. If the Fed’s monetary policy minutes is announced tomorrow morning, keep going to dovish, and it is believed that the price of gold is expected to rise further. On the contrary, it will probably fall, and the gold price trend will be reversed. It is currently estimated that 1350 and 1353 US dollars are important resistance to gold prices. If it breaks, it is expected to go up to $1,362. Conversely, the price of gold may fall.

US crude oil futures:
56.70/57.05 resistance
55.65/55.05 support
The Sino-US trade consultation negotiations looking good and the dovish speech of the Fed officials have once again boosted crude oil prices. The OPEC oil group said it will continue to cut production. If the Sino-US consultations progress again this week, it is expected to continue to push up crude oil prices. However, technical attention must be paid to the support level of 56 US dollars. Pay attention to adjusting the risk. If the crude oil price falls below 56 US dollars, the trend may continue downward. In addition, the Fed’s monetary policy record will be equally important tomorrow morning and must be concerned.

US Dow Jones Industrial Index Futures US30
26050/26125 resistance
25780/25660 support
The Sino-US trade consultation has made progress and the market is waiting for the next round of consultations this week. In addition, the Fed officials' dovish speech boosted the investment market sentiment and the US and global stock markets made good. Before the current consultation meeting, the two sides expressed a good process and supported the stock market to improve, but must pay attention to fluctuations and adjustments. Technically, special attention is paid to the resistance of 26050 and 26125. If the test fails, be careful to reverse the trend.

3780  / 3580 support
3950 / 4100 resistance 
US Federal Reserve official said that if the US economy performs as expected, it is not necessary to raise interest rates during the year,the market expected the Fed is considering to stop interest rate hikes this year. The commentary is increasing the cryptocurrency market demand and now the dollar depreciation that will be pushed up the price of bitcoin. The first resistance at US3750 breakthrough, then the next target will be 3950 and next is 4100.

Enjoy trading!  The content is for reference only. Please do ensure that you understand the risk.

Information provided by ATFX, Chief Analyst of Asia Pacific: Martin Lam

Registered Australian Accountant/ Certified Professional Manager / Certified Financial
Advisor Experienced Investor / Media Market Commentator Martin Lam has Over 17 years’ experience in global investment market. Familiar with the worldwide stock indices, precious metals such Gold and Silver, Crude oil and Forex. He operated Martin Currency Trading Company and had partnership with a number of well-known international financial corporations and institutions. Before he join ATFX, he was TeleTrade Greater China development and Sales Director. Mr. Lam attends Hong Kong Now TV and China CCTV finance channel once a week. He also had regularly invited by different media, such as DBC Digital Financial Channel, Hong Kong Economic Times, The Standard, Ming Pao to share his experience to trade in Forex, Precious metals, Crude oil and worldwide stock indices. 
Contact: [email protected] or wechat: ATFX_China

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