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Canadian Dollar Falls, Tillerson Oust Hurt Stocks

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The Canadian Dollar was one of the biggest movers today, falling broadly against its major counterparts as BOC’s Governor Steven Poloz cooled hawkish policy bets. Mr. Poloz said that the central bank “will remain cautious on future rate moves” and that the economy “has room to expand without fueling inflation”.

The anti-risk Japanese Yen also underperformed on Tuesday, though it could have been far worse. It was initially undermined by gains in Japanese shares during the Asia trading session. However, a retreat in Wall Street later on Donald Trump’s replacement for Secretary of State Rex Tillerson gave the Yen some relief.

Meanwhile the British Pound gained as UK’s Chancellor Philip Hammond presented his Spring statement. He cut the budget deficit forecast for the 2017/18 year to 2.2 percent of GDP from 2.4 and gave a positive outlook on employment and wage growth.

DailyFX Economic Calendar: Asia Pacific (all times in GMT)

Asia AM Digest: Canadian Dollar Falls, Tillerson Oust Hurt Stocks

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Asia AM Digest: Canadian Dollar Falls, Tillerson Oust Hurt StocksAsia AM Digest: Canadian Dollar Falls, Tillerson Oust Hurt StocksAsia AM Digest: Canadian Dollar Falls, Tillerson Oust Hurt Stocks

IG Client Sentiment Index Chart of the Day: NZD/USD

Asia AM Digest: Canadian Dollar Falls, Tillerson Oust Hurt Stocks

CLICK HERE to learn more about the IG Client Sentiment Index

Retail trader data shows 39.4% of NZD/USD traders are net-long with the ratio of traders short to long at 1.54 to 1. In fact, traders have remained net-short since Jan 05 when NZD/USD traded near 0.70246; price has moved 4.2% higher since then. The number of traders net-long is 3.0% lower than yesterday and 9.6% lower from last week, while the number of traders net-short is 20.4% higher than yesterday and 6.1% higher from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests NZD/USD prices may continue to rise. Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger NZD/USD-bullish contrarian trading bias.

Five Things Traders are Reading:

  1. NZD/USD Technical Analysis: Rebound Struggles Before GDP Data by Ilya Spivak, Sr. Currency Strategist
  2. Price Action Setups Around a Falling US Dollar After CPI Sell-Off by James Stanley, Currency Strategist
  3. Crude Oil Price Forecast: US Production Surge Has Spreads Favor Downside by Tyler Yell, CMT, Forex Trading Instructor
  4. Weekly Technical Perspective on EUR/USD, EUR/JPY and EUR/AUDby Michael Boutros, Currency Strategist
  5. GBP/USD Breaks Out Amid Waning Bets for Four Fed Rate-Hikes in 2018by David Song, Currency Analyst

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Weekly Trade Levels for US Dollar, Euro, Sterling, Loonie, Gold & Oil

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New to Forex Trading? Get started with this Free Beginners Guide

DXY, Euro, Loonie Monthly Opening-Ranges Intact

The US Dollar Index is trading into the monthly opening-range highs into the start of the week and the focus is a reaction around the 98.05/10 resistance zone- note that the monthly ranges in Euro and Loonie also remain intact. In this webinar we review updated technical setups on DXY, EUR/USD, USD/CAD, GBP/USD, Crude Oil (WTI), Gold, USD/JPY, AUD/USD, EUR/AUD & SPX.

Why does the average trader lose? Avoid these Mistakes in your trading

Key Trade Levels in Focus

DXY – Immediate focus is on topside resistance at 98.05/10. Initial support at 97.87 with near-term bullish invalidation raised to 97.71.

EUR/USD – Euro is coiling into the monthly opening-range just above slope support. Immediate focus is on support at 1.1140. Initial resistance at 1.1187 with near-term bearish invalidation at monthly-open resistance at 1.1215– look for a bigger reaction there IF reached. A break lower would expose 1.1110.

GBP/USD – Sterling broke below multi-month slope support last week with price responding to near-term pitchfork support into the open. Initial resistance at 1.2798 with bearish invalidation at 1.2859. Downside support objectives at the August low-day close at 1.2697 and the 100% extension at 1.2662.

Gold – Risk for near-term recovery while above the yearly / monthly low-day close at 1270. Initial resistance at 1280 with near-term bearish invalidation with the monthly open a 1283.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy

Key Event Risk This Week

Economic Calendar- Key Data Realeses

Economic Calendar – latest economic developments and upcoming event risk

Active Trade Setups:

Learn how to Trade with Confidence in our Free Trading Guide

—Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michael on Twitter @MBForex



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AUDUSD Soars on Shock Election, Apple Shares Slump, Risk of S&P 500 Drop

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MARKET DEVELOPMENT – AUD Soars on Shock Election, Apple Shares Slump, Risk to S&P 500

DailyFX Q2 2019 FX Trading Forecasts

AUD: The Aussie outperforms following a shock election outcome, in which Prime Minister Scott Morrison secured re-election (full story). In reaction, the Aussie gapped higher at the Asia open, reclaiming the 0.69 handle against the greenback. However, as equity markets have headed lower throughout the European morning, risks are for gains to be faded. Alongside this, key headwinds in the form of trade war tensions and a potential RBA June rate cut are likely to limit upside. Reminder, RBA Governor Lowe due to speak tonight after RBA meeting minutes (calendar)

Crude Oil: Oil prices surged at the Asia open as Saudi Arabia signalled that cuts could be extended throughout the remainder of 2019 at the JMMC meeting, while President Trump had also stepped up his critical rhetoric towards Iran. Although, with equity prices beginning to push lower, oil prices have pared the majority of its initial gains.

Equities: US equity futures have headed lower amid the continued crackdown by the US on China’s Huawei, which in turn has chipmakers come under pressure, while Google also stated that they are to restrict the company’s use on android services. Elsewhere, Apple’s price target had been cut by HSBC to $174 (median street price target = $220), citing concerns over China, while tariff led price increases on Apple products could also have dire consequences on demand. Apple shares currently lower by 2.4% in pre-market.

AUDUSD Soars on Shock Election, Apple Shares Slump, Risk of S&P 500 Drop - US Market Open

Source: DailyFX, Thomson Reuters

DailyFX Economic Calendar: – North American Releases

AUDUSD Soars on Shock Election, Apple Shares Slump, Risk of S&P 500 Drop - US Market Open

IG Client Sentiment

AUDUSD Soars on Shock Election, Apple Shares Slump, Risk of S&P 500 Drop - US Market Open

How to use IG Client Sentiment to Improve Your Trading

WHAT’S DRIVING MARKETS TODAY

  1. Gold Price Sell-Off Continues, Silver Price Hits a Six-Month Low” by Nick Cawley, Market Analyst
  2. COT Report: Japanese Yen and Euro Shorts Collapse, USD Longs Reduced” by Justin McQueen, Market Analyst
  3. Crude Oil Price May Be Carving Out a Top” by Paul Robinson, Currency Strategist
  4. Using FX To Effectively Trade Global Market Themes at IG” by Tyler Yell, CMT , Forex Trading Instructor

— Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX



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Gold Price Sell-Off Continues, Silver Price Hits a Six-Month Low

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Gold (XAU) and Silver (XAG) Price Analysis and Charts.

  • Gold (XAU) eyes a cluster of support.
  • Silver (XAG) makes afresh 2019 low as buyers disappear.

DailyFX Q2 Forecasts and Top 2019 Trading Opportunities.

Gold (XAU) Needs to Support to Hold

The sell-off on gold continues with the precious metal down around $30 in less than a week. Gold is under pressure from a resurgent US dollar, buoyed by last Friday’s Uni of Michigan data which smashed expectations and hit a multi-year high. The important 61.8% Fibonacci retracement level at $1,287/oz. failed to provide any support when broken last week, while the $1,287 – $1,281/oz. zone made up of old horizontal support is being tested now. A clear break and close below opens the way to the recent double bottom around $1,266/oz. which is currently being guarded by the 200-day moving average at $1,268.6/oz. Below here the 50% Fibonacci retracement level at $1,262/oz heaves into view.

How to Trade Gold: Top Gold Trading Strategies and Tips

Gold (XAU) Daily Price Chart (August 2018 – May 20, 2019)

Gold Price Sell-Off Continues, Silver Price Hits a Six-Month Low

Silver (XAG) Nears a Fresh Six-Month Low

Another precious metal under heavy selling pressure. Silver is now at levels last seen in early December last year and is over 11% lower since making its recent high of $16.21/oz. in late February. The downtrend since the late-February high continues to be respected and it is possible that silver completely retraces all the way back down to the November 14 low at $13.89/oz. Psychological support at $14.00/oz. may slow the decline, while the CCI indicator shows that the market is extremely oversold.

Silver (XAG) Daily Price Chart (August 2018 – May 20, 2019)

Gold Price Sell-Off Continues, Silver Price Hits a Six-Month Low

Trading the Gold-Silver Ratio: Strategies and Tips.

IG Client Sentiment data show that retail traders are 79.1% net-long gold, a bearish contrarian indicator. Recent daily and weekly sentiment shifts give us a stronger bearish contrarian bias.

— Written by Nick Cawley, Market Analyst

To contact Nick, email him at nicholas.cawley@ig.com

Follow Nick on Twitter @nickcawley1



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