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ATFX Market Outlook, 2020 Feb 5

 

Personal opinions today: 

 

U.S. factory orders beat market expectations, US dollar and Dow futures rose, sending safe-haven assets out of the market. Gold, the silver price fell and the dollar/yen up. Expectations for gains in the dollar index and Dow futures could be limited before ADP jobs data release tonight, If the job data decline is greater than 150,000, the US dollar downtrend is expected to extend to U.S. non-farm payrolls data announced.

 

Markets looked ahead to European trading hours today. First, the final reading of German and Eurozone PMI for January and Eurozone retail sales for December. Meanwhile, Britain released its PMI for the services sector for January. Market forecasts for Eurozone and UK data were flat, but it is worth noting that Eurozone retail sales are expected to fall in December, bearish for the Euro, and bearish for the pound and the Swiss franc.

 

In U.S. trading, the U.S. released ADP job data. The report followed the release of the Markit and ISM PMI for January. If all data over expectation growth, the dollar index and Dow futures could stronger, bearish gold, silver and yen, and bullish crude oil prices.

 

[Important financial data and events]

Note: * refers to the degree of importance

 

09:30 China Caixin PMI for January **

14:45 Swiss consumer confidence index for Q1 **

16:55 Germany PMI services sector for January ***

17:00 Eurozone PMI for January **

17:30 UK services sector PMI for January **

18:00 Eurozone retail sales for December ***

20:15 ECB President speech ***

21:15 U.S. ADP job data for January ***

21:30 U.S. December trade account **

22:45 U.S. Markit services sector PMI for January ***

23:00 U.S. ISM non-manufacturing PMI for January ***

23:30 EIA crude oil inventories change**

The United States Senate voted to impeach the President

 

Euro 

1.1065/1.1075 resistance

1.1030/1.1020 support

German and Eurozone manufacturing PMI for January met market expectations for a slight increase, while Eurozone PPI was flat in December. Then, U.S. factory orders growth outperforming the Eurozone, EURUSD fell. Market expectations Eurozone economic data expect fell and bearish the Euro. In the evening, ECB President’s speech, investors are waiting for her comments. The euro is currently expected to trade at $1.1020, as key support.

 

Pound to dollar

1.3050/1.3060 resistance

1.2960/1.2950 support

The economic and trade relations between the UK and the EU after Brexit still uncertainty, investors concern any risk of the deal, bearish pound. Separately, the dollar rose on strong U.S. economic data, sending the pound lower. Tonight the market in the US ADP job data for January and the final PMI for the service sector. The dollar's gains are now likely to be limited ahead of the data, with pound likely to test 1.3050 or 1.3060 resistance. Then please pay attention in US data tonight, judge the direction of the US dollar against the pound.

 

Australian dollar

0.6750/0.6760 resistance

0.6695/0.6685 support

The Australian dollar rebounded against the U.S. dollar yesterday after the RBA left rates unchanged The next step is to watch the performance of U.S. economic data tonight, estimated to limit the rise of the Australian dollar. Technically, AUDUSD trends from the low move up, looking for 0.6760 resistance. If the resistance is broken, the upper resistance is 0.6800.

 

Dollar to yen

109.45/109.55 resistance

108.80/108.70 support

U.S. economic data beat expectations and risk aversion cooled, Dow futures rebounded and the dollar tested 109.55 resistance against the yen. U.S. ADP jobs data tonight could raise concerns as investors wait to see the outcome, with Dow futures limiting gains and the dollar/ yen limiting 109.55 resistance. Technically, keep an eye on U.S. data and Dow futures tonight. If Dow futures fall, the dollar/ yen will follow the trends.

 

USDCAD 

1.3315/1.3325 resistance

1.3270/1.3260 support

Crude oil inventories rose sharply last week, crude oil prices continue to fall, bearish Canadian dollar. Focus on OPEC discussions and comments today and impact on Canadian dollar volatility. If crude oil prices rebound, expect bullish Canadian dollars. In addition, investors watch the U.S. job data and economic data, indirectly affect the trend of the Canadian dollar.

 

US crude oil futures

51.00/51.30 resistance

49.65/49.45 support

The market is watching OPEC members meet to discuss a cut in crude oil production. If the OPEC will offer to cut production, the prices could rebound. In the short term, watch the U.S. jobs and economic data indirectly affect oil price volatility tonight. Technically, though, crude fell below the $50.05 target support. The market is expected to $49.45, supported by fundamental news, before regaining ground. Current hourly moving averages in USOIL chart limit gains, keeping an eye on 51.00 or 51.30 resistance.

 

Gold

1572/1574 resistance

1549/1547 support

U.S. economic data beat expectations, Dow futures rose and gold fell as risk aversion cooled. Gold has an opportunity to continue to test its highs if U.S. jobs data tonight is as weak as expected and Dow futures fall. Technically, keep an eye on Dow futures, which move in the opposite direction of gold.

 

U.S. Dow Jones industrial average futures US30

28890/29000 resistance

28645/28555 support

U.S. factory orders for December over market expectations for a 1.8% gain, a strong reading, and Dow futures rebounded. The market will be watching U.S. ADP jobs data tonight. If job data under investors’ expectation, Dow futures could test 28,645 or 28,555 support. If the data falls sharply, Dow futures could adjust further. References next support, 28325.

 

BTCUSD:

9575 / 9800 resistance

9050 / 8800 support 

Keep watching the Dow future and global stock market indexes. If Dow keeping downtrend, the bitcoin price could up.