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ATFX Market Outlook, 2019 Oct 21

 

Personal opinions today:

 

Over the weekend, new Brexit deal was voted down by the British parliament. The investment climate has been affected by the British parliament request to postpone Brexit deadline. It is estimated that it is difficult for the UK to smoothly pass the Brexit agreement in the short term, the British pound has increased the risk, and the Euro and pound have fell. Gold prices, crude oil prices and even global stock markets have been affected by the fluctuations. Gold and silver prices rose as risk aversion returned and equity markets fell. The USDJPY opened lower in Asian trading.

 

The European central bank (ECB) monetary decision on Thursday and formally announce that its new President will take over on November 1st. Later, the ECB officially restarted its TLTRO program in the hope of invigorating the European economy and bringing about recovery opportunities. At last month, the ECB next President said he was looking into the possibility of a big rate cut. This European central bank meeting, can again put forward the relevant research and release the implementation time to be watched by the market. If the ECB has such a plan, it is believed to be good for the future economy of Europe, and EURUSD has the support of investors, hoping to bullish the Euro. But under normal circumstances, a similar situation is expected this week before the release of the European central bank interest rate decision, the Euro downward.

 

[Important financial data and events]

Note: * is the degree of importance

 

12:30 Japan national industrial activity index for August **

14:00 German PPI in September **

22:00 Canadian national economic confidence index **

23:00 Canadian parliamentary election ***

Japan holiday tomorrow

 

Today's suggestion:

 

Euro/dollar

1.1165/1.1175 resistance

1.1100/1.1090 support

Brexit deal failed, threaten the Euro. It remains to be seen whether the UK prime minister will again present his proposals to parliament. If it is accepted by a majority of lawmakers, the Euro could test 1.12. Otherwise, retry 1.10. It is believed that the news of Brexit negotiations will continue to affect the pound and indirectly affect the Euro. Also, watch out for the possibility that the Euro could fall to 1.10 before the ECB's monetary policy decision this week.

 

Pound to dollar

1.2945/1.2960 resistance

1.2855/1.2840 support

The British prime minister submitted the Brexit agreement to the British parliament for a vote, but it was rejected by British MPS. The UK may fail to successfully leave the EU under the agreement by the end of October, and the pound fell, temporarily unable to break through 1.30. If the British parliament again rejects the deal this week and the European commission does not approve of a delay to Brexit, it may lead to bearish on the pound. Keep watching the GBP 1.2840 support.

 

Australian dollar to US dollar

0.6875/0.6890 resistance

0.6840/0.6825 support

The reserve bank of Australia (RBA), which has cut interest rates twice last couple of months, released update annual report for 2019 last week, which showed that Australia's economy was doing well after the rate cut and the data showed growth. In addition, China and US. trading relations continued to improve, and the success of the first round of trade negotiations was welcomed by investors, with the benefits of the Australian and New Zealand dollars. But technically, the last month's high of 0.6890 will be an important reference resistance.

 

Dollar to Japanese Yen

108.85/108.95 resistance

108.25/108.10 support

The Brexit agreement failed to pass the British parliament, the investment sentiment changed, Dow futures and Nikkei index futures trend failed to continue to rise, the USDJPY failed to test 109 key resistance, adjusted to fall. Last week, Dow and Nikkei futures were likely to fall, and the dollar will follow suit against the yen. It is estimated that the USDJPY will continue to follow Dow and Nikkei futures. Keep watching the Brexit deal, how affected the trend of the USDJPY.

 

U.S. dollar to Canadian dollar

1.3190/1.3200 resistance

1.3120/1.3110 support

The Canadian dollar was indirectly affected by crude oil prices fell after the British parliament failed to pass a Brexit deal. Technically, after USDCAD testing $1.31 support, it could return to $1.32 if crude oil futures prices fall.

 

United States crude oil futures

54.45/54.70 resistance

52.80/52.55 support

The failure of the British parliament to approve a deal to leave the European Union has bearish crude oil prices. Combined with weak U.S. economic data, crude oil prices adjusted down to $52 probably. From fundamentals to technical analysis, crude oil prices at or below $52. It could supported, and the investor possibility of make long positions at these levels is noteworthy. Important support bits focus on 52.80 and 52.55 support, respectively.

 

Gold

1498/1500 resistance

1486/1484 support

The price of gold has risen after British parliament failed to approve a new Brexit deal. The British prime minister has sent a letter to the European commission hoping for delay in the deadline. Investors took note of risk on, the demand increasing cause the Brexit deal failure n this moment. In addition, money may flow back into the gold market again, pushing gold prices higher as expectations of Fed rate cut and ahead of a rate hike by the European central bank (ECB). Technically, if Dow futures fall and gold prices rise, silver tends to follow gold. In the short term, it's worth watching Dow futures move, how gold prices move.

 

U.S. Dow Jones industrial average futures US30

26940/27020 resistance

26720/26660 support

Dow futures failed to hold 27,000 points after the Brexit deal failed to pass British parliament. But markets are waiting for the Fed to cut interest rates, betting that weak U.S. economic data could decline Dow futures. But for technical analysis, Dow futures could still move higher if they maintain 26660 support.

 

BTCUSD:

8600/ 8850 resistance

7885 / 7655 support

As US economy slowdown, FOMC would consider cut Fed fund rate. It is supposed bullish for crypto currencies, such as  Bitcoin and other popular crypto currencies. After the weekend, the Brexit deal failed, the the crypto market demand increasing. Technically, the bitcoin price support at US7885 is keeping. Assuming the bitcoin price as followed the gold price. If FOMC and ECB would cut interest rate, bitcoin price could rise further.

 

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

 

Information provided by AT Global Market, 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.

 

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