Sentiment Bruised by Tariff Plans, Emerging Markets Tumble

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Asian stocks were under renewed selling pressure this morning as global trade concerns and chaos across emerging markets weighed on risk appetite.

Global trade developments have certainly placed investors on an emotional roller-coaster ride this week with the initial optimism over NAFTA talks outweighed by US-China concerns. Market sentiment is likely to remain cautious, especially after President Trump threatened to withdraw the US from the World Trade Organisation. With recent reports of Trump voicing his support to impose new tariffs on China, possibly intensifying concerns over US-China trade tensions, risk aversion could remain a dominant theme in the short to medium term

Emerging market currencies have been beaten black and blue by investors following a brutal selloff in the Argentine Peso and Turkish Lira. The Argentine Peso collapsed after Argentina requested for the International Monetary Fund (IMF) to speed the release of a $50 billion loan, while the Lira crumbled on reports of the Turkish central bank’s deputy governor Erkan Kilimci resigning. Although the Lira stabilized against the Dollar this morning, gains may be capped by concerns over double-digit inflation, a deepening account deficit, and looming US sanctions. Emerging market currencies are likely to remain pressured by the economic turmoil in Argentina and Turkey, while external factors ranging from global trade tensions and prospects of higher rates could intensify the pain.

The Dollar edged higher against a basket of major currencies during early trade, as US-China trade tensions boosted its safe-haven appeal. With the US economy growing faster than initially estimated during the second quarter, market expectations remain elevated over a rate hike in September.

There could be some action with the British Pound as Brexit Secretary Dominic Raab meets Michel Barnier in Brussels today for further Brexit talks. If the talks end on a positive note and fears of a “hard Brexit” ease further, the Pound could receive a solid boost.

In the commodities arena, Gold prices inched higher as global trade tensions and renewed turmoil in emerging markets encouraged investors to seek safe-haven assets. However, the yellow metal still remains on course for its longest monthly losing streak since 2013. With the Dollar supported by the bullish sentiment towards the US economy and expectations heightened over higher interest rates, the outlook for Gold remains tilted to the downside. Focusing on the technical picture, prices have scope to challenge $1,214 if the $1,200 support holds. Alternatively, a breakdown below $1,200 could encourage a decline to $1,190 and 1,182, respectively.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.

EM Currencies Rattled by Argentine Peso and Lira Selloff

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Emerging market currencies were out of favour after Argentina’s peso collapsed to a record low, with the Turkish Lira, South African Rand, and Chinese Yuan all under intense selling pressure.

Buying sentiment towards the Argentine Peso was dealt a severe blow after the nation requested for the International Monetary Fund (IMF) to speed the release of a $50 billion loan. The Peso’s depreciation was so aggressive and painful that the Central Bank of Argentina was forced to raise interest rates to 60% from 45%. With the developments in Argentina fuelling concerns over the nation struggling with yet another financial crisis, the Argentine Peso’s outlook remains tilted to the downside.

In Turkey, the Lira has been beaten black and blue by sellers following reports of the Turkish central bank’s deputy governor Erkan Kilimci resigning. This development is likely to heighten fears over Turkey’s fragile financial system at a time where skyrocketing inflation and questions over central bank independence continue to weigh on sentiment.

Emerging market currencies are likely to remain under pressure as concerns of a financial crisis in Argentina and Turkey dent risk appetite. External risks in the form of global trade tensions, an appreciating Dollar and prospects of higher US interest rates may spell nothing but further pain for EM currencies.

The Chinese Yuan was caught in the fray with the USDCNY trading marginally above 6.8400 as of writing.

Investors will keep a close eye on the official manufacturing and non-manufacturing PMI’s scheduled for release on Friday which could boost sentiment towards the Chinese economy if the figures print above market expectations. In regards to the technical picture, the USDCNY could test 6.8500 in the near term if the Dollar stabilizes and risk aversion persists.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.

Risk Sentiment Wavers on Trade Fears, Gold Sinks

Market players remain in a cautious mood as lingering concerns over trade tensions between the United States and China dent risk appetite.

Asian stocks relinquished earlier gains to close in negative territory this morning while European shares declined as simmering trade tensions prompted investors to offload riskier assets. With Donald Trump’s upcoming tariffs on $200 billion worth of Chinese goods likely to deteriorate US-China economic ties even further, resumed fears over trade remains a driving concern for investors.

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Sterling boosted by Barnier, bulls capture 1.3000

The Pound experienced a sudden change of fortune after encouraging comments from Brexit negotiator Michel Barnier eased fears of a “hard Brexit”.

Bernier’s comments that the European Union was “prepared to offer a partnership with Britain such as has never been with any other third party country” has made music to the ears of Pound traders. This positive development has boosted confidence over the direction of Brexit talks. The Pound’s aggressive appreciation following Barnier’s comments continues to highlight how the currency remains extremely sensitive to positive Brexit headlines.

Focusing on the technical picture, the GBPUSD is turning increasingly bullish on the daily charts. There have been consistently higher highs and higher lows created since the middle of August while prices are trading above the daily 20 Simple Moving Average. A weekly close above 1.3000 could seal the deal for bulls for prices to attack 1.3070 and 1.3130, respectively. If 1.3000 proves a stubborn resistance, Sterling could sink back to 1.2900.

South African Rand tumbles as Argentina Peso slides

The South African Rand has received another battering during trading on Thursday with the currency being hit from multiple directions.

The resumption of what very much could become another crisis for the Turkish Lira complimented by the Argentine Peso situation taking another dive for the worse, combined by prolonged concerns over trade tensions between the United States and China, is spelling out to investors a very reluctant environment for them to invest in high-yielding assets.

I would keep a very close eye on the situation with the currencies of Argentina and Turkey because it represents a major risk to deterring traders away from investing in any high-yielding assets, meaning that the situation for the South African Rand could get a lot worse due to external headwinds.

 Commodity spotlight – Gold

Gold’s trajectory continues to be heavily influenced by the Dollar’s performance and US interest rate hike expectations.

The yellow metal depreciated today after reports of US economic growth expanding faster than expected during Q2 cemented market expectations of a US interest rate hike in September. With the Dollar likely to stabilize on Fed rate hike speculation and safe-haven demand, Gold could resume the downtrend.

In regards to the technical picture, the yellow metal needs to break back below the $1,200 level for bears to attack $1,190 and $1,182, respectively. If the $1,200 support holds, then prices could retest $1,214.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.

Lukman’s Week Ahead: Market themes to watch out for – Webinar Sep 03

Have an in-depth look at what’s in store for the global and local markets with FXTM’s Research Analyst, Lukman Otunuga. Get the latest on the biggest market developments, how they could potentially impact trading instruments and a look at what major events are in store the week ahead.

Sterling Rallies Above 1.30, Can it Hold?

Sterling traders were caught by surprise on Wednesday after the EU’s Chief Brexit negotiator Michel Barnier said, “We are prepared to offer a partnership with Britain such as has never been with any other third country.” His statement comes after the risk of a hard Brexit, or no-deal Brexit grew significantly over the past few weeks. The Pound rallied sharply on the news, gaining 149 pips against the dollar.

Many investors would be wondering whether Barniers’ statement could be a turning point for the Pound. Although many issues related to trade and the Irish border are far from being resolved, it currently seems that negotiations may begin moving in the right direction. If positive news flows continue when Brexit Secretary Dominic Raab heads back to Brussels on Friday to resume talks, GBPUSD may quickly return to July highs that were above 1.33. However, expect volatility to surge in the coming weeks as we get closer to the Brexit deadline.

Positive news was also flowing from the U.S. leading to new record highs in the S&P 500 and the Nasdaq. President Trump is optimistic that Canada will join Mexico’s and the U.S.’ trade agreement. Canadian Prime Minister Justin Trudeau also shared Trump’s optimism indicating there’s a possibility a trade deal that includes Canada could be reached by Friday. With U.S. midterm elections about two months away, I believe Trump wants to strike deals, not just with Mexico and Canada, but probably the European Union too. This should continue fueling the rally in equities at least in the short run given that economic fundamentals and earnings remain robust.

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In Australia and New Zealand, the situation is looking gloomier. AUDUSD fell 0.4% on Wednesday after Westpac, one of the largest nation’s banks raised mortgage rates by 14 basis points as funding costs increased. This move may lead to further delaying an interest rate hike by the Reserve Bank of Australia as more banks are likely to follow Westpac’s actions leading to lower disposable incomes for consumers already struggling with low wage growth. The currency lost another 0.4% today after capital expenditures unexpectedly fell 2.5% in Q2 which will become increasingly worrying if such a trend continues.

The New Zealand dollar is the worst major performing currency today. NZDUSD fell almost 1% in the Asian trading session after business confidence fell to -50.3% in August, a level not seen since April 2008. These figures are likely to be reflected in lower GDP growth for Q3 and lowering interest rates may be taken into consideration. Thus, expect to see further declines in the currency until economic data starts pointing north again.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.

Global Stocks Higher but US-China Concerns Linger, Bitcoin Conquers $7000

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It’s remarkable how the initial euphoria from the US-Mexico trade deal has been slightly overshadowed by growing concerns over US-China trade relations deteriorating further.

The breakthrough in NAFTA negotiations between the United States and Mexico, coupled with optimism over Canada joining the agreement was certainly a positive step forward to easing trade war fears. However, two steps could be taken back if the Trump administration raises tariffs on $200 billion of Chinese goods on September 5th. This caution has slightly impacted risk sentiment this morning with Asian stocks edging marginally higher. Although European equity markets rose slightly higher at open, gains could be limited as investors continue to closely monitor the latest developments revolving around global trade.

Dollar steady ahead of US GDP

The Dollar slightly appreciated against a basket of major currencies on Wednesday as investors awaited the latest estimate for second quarter US GDP scheduled for release later in the day.

Dollar weakness has been a recurrent market theme since the middle of August thanks to US President Donald Trump, cautious Fed minutes and a fading safe-haven appeal. Although market expectations remain heightened over the Federal Reserve raising interest rates in September, the rate outlook for December and beyond may be heavily data dependent. The Dollar could receive a solid boost if US GDP shows robust growth in the revised second-quarter figures.

Focusing on the technical picture, the Dollar Index has staged a modest rebound from the 94.50 level. A breakout above 95.00 could inspire a move towards 95.45. Alternatively, a break back below 94.50 could open a path towards 94.20 and 94.00.

GBPUSD pressured below 1.2900

Sterling is likely to remain vulnerable to downside losses as fears of a no-deal Brexit weigh heavily on the currency and haunt investor attraction.

Although a vulnerable Dollar initially offered the Pound some support, prices remain capped below the 1.2900 resistance level. If the Dollar finds support this afternoon from the US GDP report, the GBPUSD could trade back towards 1.2820 and potentially lower. However, a technical breakout above 1.2900 may invite an incline towards 1.3030.

Bitcoin breaks above $7000

Bitcoin bulls both found ample support in the form of a vulnerable Dollar and improving risk sentiment this week with prices breaking above the $7000 level.

There seems to a be a strong sense of anticipation building ahead of the U.S. Securities and Exchange Commission’s (SEC) decision in approving a Bitcoin ETF in September. If a Bitcoin ETF becomes reality, cryptocurrencies could receive a solid welcome boost.

Focusing on the technical picture, Bitcoin is looking bullish on the daily charts with prices trading marginally above $7050 as of writing. A breakout above $7100 could encourage an incline higher towards $7153 and $7200, respectively.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.

Loony and Bitcoin Lift Strongly as USD Falls

It’s been all about the United States today in global markets as the dollar slipped lower as investors flocked to riskier assets. This was on the back of the trade agreement between the US and Mexico, which is looking positive for the US economy in the long run. There are however a number of issues around it including Canada not being a part of it, but more importantly the need for Congress and the Senate to ratify anything. With upcoming mid-term elections in the US in the next 3 months, it’s unlikely anything could be officially signed and sorted until then, and there is the very real prospect of the Democrats gaining some traction according to recent polls. So I would expect more drama in the long run around this proposed deal, as it’s very hard to do anything without Congress on your side as previous administrations have noted.

Given the big rise, one that is worth noting has been of course the USDCAD which has fallen sharply on the recent news. With the CAD has been the bigger winner currency in all of this, support at 1.2881 was only just able to hold back the bearish side as of late. Looking at the chart we can see that resistance levels can be found at 1.2960 and 1.3041 at present. The 100-day moving average also continues to act as dynamic resistance and support, but only when the economic and political news is light. There is further potential for things to move lower, but at this stage, the bulls have fought back quite hard.

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BTC/USD has been one of the big winners on the weaker USD as it lifted sharply on the back of an increase in risk appetite as well. The cryptocurrency king has been moving rapidly as of late with the fluctuations of the USD, and many are comparing it to another silver or gold where it’s treated as a store of wealth in the long run, just in an online format.

With that in mind, the bulls have made a welcome return for crypto investors and it’s looking positive at present as it pushes up to resistance at 7308. The key thing to note around BTC/USD is that it can be very technical given it does not play of economic data as much, so traders will be focused on a potential trend line that has formed that is bearish in nature at this given time. So a move above resistance at 7308 would be a cause for concern.  Support levels can be found at 6720 and 6065 if the market does decide to turn. In the long run, though BTC/USD is looking bearish, the bulls are always eager to turn it around if, given the chance, there is after all, still a lot of belief in it.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.

Equities Rise & Dollar Falls on U.S. – Mexico Trade Agreement

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The trade agreement reached between the U.S. and Mexico made the headlines on Monday. The news sent the S&P 500, the Nasdaq, and the Russell 2000 to new record highs. The Dow Jones Industrial average broke above 26,000 for the first time since February and is currently 567 points away from its January record high.

The U.S. – Mexico deal seemed to boost confidence that the trade war is moving closer to an end, and the next question is who’s next to close a deal with Trump? Global trade tensions have undoubtedly been the most significant source of risk in 2018. It led to massive falls in emerging market currencies and sent Chinese equities into a bear market after $2 trillion were wiped off their value.

Although investors finally see the light at the end of the dark tunnel, when it comes to China the tunnel may prove to be too long with lots of bumps along the way. However, it’s Canada what investors will be watching next.

The dollar which gave up 2.3% from its 14-months high will continue to retreat lower if Canada manages to secure a similar deal this week. But if negotiations fail there’s a high chance that traders return to king dollar, and the surge in risk appetite will be short-lived.

Although most Asian stocks traded higher following Monday’s Wall Street performance, mainland China stocks fell back into red territory with Shanghai composite and Shenzhen indices retreating slightly. This suggests that neither the U.S. – Mexican deal nor PBOC’s efforts to put a floor on the CNY managed to attract investors. The latest announcement by China’s central bank to reintroduce a “counter cyclical factor” to determine the renminbi’s exchange rate is aimed to stabilize the currency after it fell for nine straight weeks since mid-June. However, with the economy continuing to gradually slow, government pushing for deleveraging, and ongoing trade tensions with the U.S., it’s more likely to see a weaker currency longer term. That’s probably why the PBOC’s move was not enough to encourage investors to buy risk assets.

The economic calendar is relatively light today, so expect currency traders to continue taking the cue from equities performance and any update on U.S. trade negotiations with Canada.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.

Cohen, Manafort & Trump! What’s Next?

Last week has been a terrible one for President Trump. His former campaign chairman Paul Manafort was found guilty on eight counts of bank and tax fraud on Tuesday, while his ex-personal lawyer Michael Cohen pleaded guilty to campaign finance violations and other charges on the same day. Investors who believe that Trump policies were the key attributes to the recent stocks rally may start becoming worried as speculation that he may be impeached is growing day after day. After all, he’s the one who sets the path for fiscal policies.

However, when looking at last week’s markets performance, it seems investors didn’t really care about the drama happening at the White House.  The S&P 500 closed at a new record high on Friday and cleared all doubts that we’re in the most extended bull market in U.S. history.

Although it’s difficult to know what happens next, it’s worthwhile looking at history and see how markets reacted on the impeachments of previous Presidents. The Watergate scandal led to the resignation of President Richard Nixon in August 1974. Stocks were already in a bear market since 1973 due to the collapse of the Bretton Woods system, the dollar’s devaluation and the 1973 oil crisis. Two months after Nixon’s impeachment, markets found a floor and rallied by more than 50% in less than a year. Meanwhile, Clinton’s impeachment attempt in the late 1990’s by the House of Representatives occurred during a robust economic expansion and investors didn’t care less. Markets continued to rally until the burst if the dotcom bubble.

These two historical examples confirm that investors don’t really care who the President is. It’s economic growth, fiscal policies, monetary policies, and earning growth that matters.

The current political turmoil won’t affect economic expansion or employment. U.S. corporates continue to benefit from tax cuts and got the wanted deregulation.

What investors should be focusing more on is what’s next for the Federal Reserve as the yield curve gets closer to inversion. If Fed Chair Jerome Powell decided to slow down the pace of tightening policy, this might provide an additional boost to stocks while it weakens the dollar. Political noise will add some volatility but won’t change the trend.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.

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Quiet market before Powell Jackson Hole speech

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There is a lower level of market volatility at the end of the week, with investors on stand-by mode before Federal Reserve Chair Jerome Powell speaks at Jackson Hole later today.

Traders are probably on the edge of their seats wondering whether Powell will respond at all to the criticism from President Trump towards US interest rate policy earlier in the week, but the most market-friendly way to respond to such comments would be to ignore them. The Federal Reserve does remain set on raising US interest rates once again next month, and there is no reason for the Fed to deter from this path. I personally doubt that he would acknowledge the comments made by President Trump during Jackson Hole.

Powell might be able to create some volatility for traders is if he highlights the potential impact the ongoing trade tensions is a risk to the global economy. There are indications that the global economic outlook is slowing when compared to this time last year, and the latest FOMC Minutes release from this week did create a picture that Federal Reserve policymakers are concerned about the prolonged trade tensions. If Powell suggests that these concerns over trade tensions could also weaken the US economic outlook, this would represent a risk for the Dollar.

Elsewhere a threat for financial market volatility would be if Jerome Powell takes an unexpected turn towards offering monetary guidance on what the outlook for 2019 could bring. The market is already pretty much set-on for the Federal Reserve to raise US interest rates next month with the door also remaining open for a potential US interest rate increase before the year concludes, but there isn’t much guidance on what to expect next year. It might be a little premature at this stage to speculate, but if Powell suggested that 2019 would bring a less active approach towards raising US interest rates this would be seen as a negative for the US Dollar.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.

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GBP and AUD in focus

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Another day, another Brexit drubbing for the pound, as markets were not impressed with the guidance released today on the options of a hard Brexit. A number of key politicians and business groups are currently lobbying to make sure such a scenario never happens. However, as time goes on and optimism starts to wane, the effect on the pound continues to be a serious threat. The market is now expecting to see some sort of movement by the end of this year on Brexit, or else we could see further pound pain for traders.

The GBPUSD is currently pushing on support levels at 1.2798 as markets start to worry about the consequences. If the pain continues to be a factor and the USD strength continues to shine, then certainly I would expect traders to busy through this support level and look to march on 1.2652. With USD support continuing to be a major theme in the market, I would be surprised to see the bulls come back into the market. If they do then resistance at 1.2958 and 1.3069 is likely to be targets for traders aiming higher. However, that would be throwing caution to the wind in the current market climate.

Spare a thought for Australian dollar bulls who are continuing to suffer. After the recent positive economic data for employment and the upbeat nature of the economy, despite the struggles the Australian government is currently going through due to massive turmoil over leadership. This comes in the face of polls being negative for the incumbent prime minister, which in turn has lead to many challengers suddenly appearing. Nothing new for Australia politics however, which has seen a number of prime ministers toppled in the last decade. With economic data likely to be very light for the rest of the week I would expect markets to react sharply to political news more than anything, but a swift confirmation of a prime minister may certainly have a rally effect.

The AUDUSD, as a result, has hit support at 0.7237 at this stage, with traders likely to continue to add further pressure if the political situation continues. With this in mind support at 0.7178 is likely to be a key target for traders looking to capitalise on the situation. If the political situation were to improve for the better then the bulls could come back into the market and push up to resistance at 0.7310, however it would be a hard ask to push above this given the 50-day moving average and the trend line which is coming into play.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.

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Moving Average Envelopes and the Postman Strategy – Webinar Aug 30

Want to discover the hidden power of the moving average indicator? Take the time to learn with FX trainer Jacques Nel in the Moving Average Envelopes and Postman Strategy webinar! During this session, you’ll discover how to understand the markets using moving averages and envelopes, examine indicator calculations in detail and understand entries and exits with the Postman Strategy. What are you waiting for? Register today!

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Jacques Nel is FXTM’s Forex Educator. Thanks to his military background, he developed an attitude of discipline, perseverance and dedication. He studied math, physics and statistics in the military academy, and from early on in his career, he was a trainer of trainers, passing on his experience to others.

Lukman’s Week Ahead Webinar, Aug 20 – Market Themes to Watch Out For

Have an in-depth look at what’s in store for the global and local markets with FXTM’s Research Analyst, Lukman Otunuga. Get the latest on the biggest market developments, how they could potentially impact trading instruments and a look at what major events are in store the week ahead. About the presenter:

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Lukman Otunuga has been a Research Analyst at FXTM since 2015. A keen follower of macroeconomic events, with a strong professional and academic background in finance, Lukman is well versed in fundamental and technical analysis. His in-depth analysis on global currency and commodity markets is often cited by leading international media, including the Associated Press (AP), BBC, CNBC, CNN, Marketwatch, NASDAQ, and The Telegraph. He has also appeared on Africa’s biggest television network, NTA 2. Lukman holds a BSc (hons) degree in Economics from the University of Essex, UK and an MSc in Finance from London School of Business and Finance.

FXTM wins twice in the prestigious World Finance Forex Awards

Global, award-winning forex broker FXTM has stormed to the forefront of forex trading over the past seven years, establishing itself as a fast-growing authority in the industry. Recently, its successes were recognised in the World Finance Forex Awards 2018, where the broker was awarded the coveted prizes for Best FX Broker in Asia and Best Trading Conditions, writes FXTM Staff Writer Natasha Keary.

The World Finance Awards aim to honour excellence in the financial services sector. Deserving candidates are nominated by the online magazine’s large readership, and vetted by a judging panel with over 230 collective years of experience in finance and business journalism.

Despite operating for only a short period of time, FXTM has grown from success to success and accrued an impressive number of titles and accolades. Earlier this year, the FXTM brand received the sought-after operating licence from the FCA, the UK’s trusted regulatory body. The licence allows FXTM to broaden its horizons and offer its services to key economic regions further afield – upholding its commitment as a global broker with a local touch.

The multi-award winning broker has consistently placed education at the heart of its services. The markets are rife with political and financial uncertainty, and FXTM is committed to preparing traders by providing them with first-class education. FXTM’s webinars and seminars are delivered by members of the company’s leading market research team, and provide traders with the latest market analysis. In 2018, FXTM’s educators have helped over 2,000 traders across the world formulate a personalised trading strategy. So far this year, 100 educational events – and counting – have covered some of the most pressing and important global issues in multiple languages around the world.

FXTM was recognised as Best FX Broker in Asia due to both the company’s worldwide educational initiatives, and the regular series of media tours conducted by its in-house team of market analysis experts. Thanks in part to Global Head of Currency Strategy and Market Research Jameel Ahmad’s regular interviews with media heavyweights, these tours cement FXTM’s presence in Asia.

FXTM continually strives to provide its clients with superior trading conditions. The Best Trading Conditions award recognises the company’s latest exceptional performance statistics. Auditing giant PricewaterhouseCoopers (PwC) checked FXTM’s performance figures, which included order execution speed on an FXTM Pro account recorded at just 0.054 seconds in June 2018. With impressive statistics such as these, FXTM’s mission to provide its clients with the best trading conditions is well and truly in force.

On the recent double-win at the World Finance Forex Awards 2018, Nicholas Defteras, CEO of FXTM (Forextime Limited) said, “Alongside an ongoing commitment towards investing in client education at all levels, offering superior trading conditions has been one of the cornerstones of FXTM’s company values since our brand was founded. We are thrilled to see that our client-centric approach towards helping traders has been recognized by World Finance, and we thank them for naming us Best FX Broker in Asia as well as honouring us as the broker with the Best Trading Conditions in 2018”.

Are you trading with a multi-World Finance Award winning broker yet? 

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Disclaimer: This written/visual material is comprised of personal opinions and ideas. The content should not be construed as containing any type of investment advice and/or a solicitation for any transactions. It does not imply an obligation to purchase investment services, nor does it guarantee or predict future performance. FXTM, its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness of any information or data made available and assume no liability for any loss arising from any investment based on the same.

Risk Warning: There is a high level of risk involved with trading leveraged products such as forex and CFDs. You should not risk more than you can afford to lose. You should not trade unless you fully understand the true extent of your exposure to the risk of loss. When trading, you must always take into consideration your level of experience. If the risks involved seem unclear to you, please seek independent financial advice.

NOTES TO EDITORS
The FXTM brand provides international brokerage services and gives access to the global currency markets, offering trading in forex, precious metals, Share CFDs, ETF CFDs and CFDs on Commodity Futures. Trading is available via the MT4 and MT5 platforms with spreads starting from just 1.3 on Standard trading accounts and from 0.1 on ECN trading accounts. Bespoke trading support and services are provided based on each client’s needs and ambitions – from novices, to experienced traders and institutional investors. ForexTime Limited is regulated by the Cyprus Securities and Exchange Commission (CySEC), with license number 185/12, and licensed by the SA FSB with FSP number 46614. ForexTime UK Limited is authorised and regulated by the Financial Conduct Authority in the UK, firm reference number 777911. FT Global Limited is regulated by the International Financial Services Commission (IFSC) with license numbers IFSC/60/345/TS and IFSC/60/345/APM.

King Dollar stands tall ahead of GDP fxtm academy

Global risk sentiment remains somewhat supported by easing trade tensions between Washington and Brussels with stock markets poised to conclude the trading week on a firm footing.

Asian stocks have already closed on a mixed note this morning, with European markets stabilizing ahead of the anticipated US GDP report this afternoon. Although the gut-wrenching selloff in Facebook shares weighed on Wall Street yesterday, US stocks could recover if US GDP data paints a positive picture of the US economy.

The trading week has undoubtedly been dominated by global trade developments and we may see this theme roll over into next week. Now a trade truce has been secured with the EU, will the United States be able to find a middle ground on trade with China? This remains a recurrent question on the minds of many investors.

Dollar appreciates ahead of US GDP

Dollar bulls were injected with a renewed sense of confidence yesterday after positive economic data boosted sentiment towards the US economy and reinforced rate hike expectations.

The encouraging jobless claims figures and durable goods orders stimulated buying sentiment towards the Dollar, consequently sending prices higher. With the attraction for the Greenback rolling over into Friday’s trading session, the Dollar Index has rallied towards the 94.90 level as of writing. Investors will direct their attention towards the pending US Q2 GDP report which could shape Fed rate hike expectations. A solid pickup in US economic growth during the second quarter of 2018 could send the Dollar Index back above 95.00 and beyond.

Euro more concerned with Dollar than ECB

The Euro’s recent weakness has more to do with an appreciating Dollar rather than the European Central Bank.

Market players hoping the ECB would create some fireworks were left empty-handed after the central bank offered no surprises during July’s policy meeting. As widely expected, interest rates were left unchanged, while the central bank reiterated its pledge to end QE by the end of 2018. The highlight of July’s meeting was when the ECB repeated that interest rates will be left on hold until “at least through summer of 2019”.

The divergence in monetary policy between the Federal Reserve and European Central Bank is likely to keep a lid on the EURUSD in the medium to longer term.

Commodity spotlight – Gold

It has been another bearish trading week for Gold mostly due to a stabilizing US Dollar.

Easing trade tensions between the United States and European Union have eroded appetite further for the precious metal with prices trading around $1218 as of writing. With the Dollar likely to remain buoyed by Fed hike expectations, the outlook for Gold remains grim.

Much attention will be directed towards the pending US GDP report this afternoon which could deal Gold the knockout blow. A strong US GDP print may ultimately strengthen the Dollar, inevitably translating into further downside for the precious metal. In regards to the technical picture, a breakdown below $1213 could inspire a decline towards $1200.

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Lukman Otunuga has been a Research Analyst at FXTM since 2015. A keen follower of macroeconomic events, with a strong professional and academic background in finance, Lukman is well versed in fundamental and technical analysis. His in-depth analysis on global currency and commodity markets is often cited by leading international media, including the Associated Press (AP), BBC, CNBC, CNN, Marketwatch, NASDAQ, and The Telegraph. He has also appeared on Africa’s biggest television network, NTA 2. Lukman holds a BSc (hons) degree in Economics from the University of Essex, UK and an MSc in Finance from London School of Business and Finance.

NZD slips on trade data

The New Zealand economy looks to be taking a hit, with trade balance data coming in much weaker than expected at -113M (200M exp), showcasing that the NZ economy is still looking sluggish compared to the rest of the world. This was further impacted by export receipts dropping as well to 4.91B (5.06B exp) which will weigh heavily on the Reserve Bank of New Zealand (RBNZ), as it looks to stimulate the economy. Given the recent changes to make sure employment becomes a key focus, it is likely to keep rates flat for some time in order to make sure businesses are able to thrive in the current environment. It will also give the RBNZ a good case to talk down the NZD when compared to the USD as a fall would help boost export receipts and the trade balance data at present.

On the charts, it was not a big move, but it was one still the less. With the ever weaker economic data and strong USD, it seems likely that the bears will look to maintain control and may look to push things lower, despite the market stagnating for a bit. With that in mind, support levels at 0.6755 and 0.6691 will be the key focus for bearish traders looking to make a push. If we the bulls come back into the market expect a surge to resistance at 0.6819 and 0.6859, but I would be careful about 0.6819 breaking anytime soon as it has seen of a bullish push only last week around this level. The 20-day moving average is also worth taking note as the market is sometimes treating it as a dynamic level when lacking further information.

 

Trump-Juncker Meeting in Focus, Lira Crumbles

European markets could benefit from the risk-on sentiment; however, gains may be limited as investors adopt a guarded approach ahead of a meeting between the EC President Jean-Claude Juncker and US President Donald Trump. With escalating trade tensions between the European Union and the United States still, a key theme that continues to weigh on global sentiment, the outcome of today’s meeting could leave a lasting impact on the markets. If the talks prove unsuccessful and trade tensions end up escalating further, risk sentiment is likely to be negatively impacted.

Market players should be prepared to expect the unexpected from the talks, especially when considering how highly unpredictable the Trump administration can be.

Turkish Lira crumbles after central bank holds rates

The Turkish Lira depreciated heavily against the Dollar yesterday after the nation’s central bank defied market expectations by leaving interest rates unchanged at 17.75%, despite inflation soaring.

This move immediately raised questions over the central bank’s independence, a month after President Recep Tayyip Erdogan’s re-election under an amended constitution that enabled him to follow through on his promise to take more direct control over monetary policy. Outside of Turkey, global trade tensions, a broadly stronger Dollar and expectations of higher US interest rates have exposed to the Lira to downside risks. With a combination of external and domestic factors eroding buying sentiment towards the Lira, the local currency remains at risk of depreciating towards 5.00 and beyond against the Dollar.

Currency spotlight – EURUSD

The EURUSD was on standby on Wednesday morning, as investors positioned ahead of the anticipated meeting between US President Trump and European Commission President Jean-Claude Juncker.

Heightened concerns over a trade war with the United States have shaved some attraction away from the Euro and this can be reflected in the bearish price action. There could be some action on the EURUSD today depending on the outcome of the meeting. Focusing on the technical picture, the EURUSD remains in a wide range on the daily charts. Sustained weakness below 1.1700 could inspire a decline towards 1.1640 and 1.1600, respectively. In regards to the longer-term outlook, the divergence in monetary policy between the European Central Bank and the Federal Reserve could ensure the currency pair remains depressed for prolonged periods.

Lukman’s Week Ahead Webinar: Market Themes to Watch Out For

Have an in-depth look at what’s in store for the global and local markets with FXTM’s Research Analyst, Lukman Otunuga. Get the latest on the biggest market developments, how they could potentially impact trading instruments and a look at what major events are in store the week ahead. About the presenter:

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Lukman Otunuga has been a Research Analyst at FXTM since 2015. A keen follower of macroeconomic events, with a strong professional and academic background in finance, Lukman is well versed in the fundamental and technical analysis. His in-depth analysis of global currency and commodity markets is often cited by leading international media, including the Associated Press (AP), BBC, CNBC, CNN, Marketwatch, NASDAQ, and The Telegraph. He has also appeared on Africa’s biggest television network, NTA 2. Lukman holds a BSc (hons) degree in Economics from the University of Essex, UK and an MSc in Finance from London School of Business and Finance.