Sign up

Daily Market Review 18th of April, 2018

Main contemporary issue in the background:

Brent: East is a delicate matter – Donald Trump’s statement that “the mission is carried out” after the military strikes against Syria by the United States and its allies allowed the “bears” of Brent and WTI to go on a counterattack. The conflict around Damascus did not turn into a mass brawl and the risks of interruptions in supplies from the Middle East declined, which led to the removal of oil futures from the region of 3.5-year highs.

However, fears about the resumption of economic sanctions against Iran, political instability in Venezuela, OPEC’s readiness to expand its commitments beyond 2018, and a strong global demand set the fans of black gold in a major way.

In addition, who will give his head to be cut-off to guarantee that the US president will not throw out another fortune?

Today’s top impact announcements:

  • 1 – 15:00 (GMT), Canada – BoC Interest Rate Decision – BoC Interest Rate Decision – If the BoC is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive, or bullish, for the CAD. Likewise, if the BoC has a dovish view on the Canadian economy and keeps the ongoing interest rate or cuts the interest rate it is seen as negative, or bearish.

Previous data release: 1.25%, Consensus regarding current release: 1.25%.

  • 2 – 15:30 (GMT), U.S. – EIA Crude Oil Stocks change – The EIA Crude Oil stockpiles report tends to generate large price volatility, as oil prices impact on worldwide economies, affecting the most, commodity related currencies such as the Canadian dollar. Despite it has a limited impact among currencies, this report tends to affect the price of oil itself, and, therefore, had a more notorious impact on WTI crude futures.

Previous data release: 3.306M, Consensus regarding current release: -1.9M.

  • 3 – 23:45 (GMT), New Zealand – Consumer Price Index (QoQ) – The purchasing power of NZD is dragged down by inflation. The CPI is a key indicator to measure inflation and changes in purchasing trends. A high reading is seen as positive (or bullish) for the NZD, while a low reading is seen as negative.

Previous data release: 0.1%, Consensus regarding current release: 0.5%.

BTC/USD:

Expected trend for today is bullish.

Bitcoin price fluctuates within sideways and tight track, testing the EMA50 now, noticing that stochastic continues to move inside the oversold areas, to form positive factor that we are waiting to assist to push the price to resume the rise.

Therefore, we will continue to suggest the bullish trend on the intraday basis unless breaking 7730.00 level and holding below it, reminding you that our main waited target is represented by testing 8643.35.

The expected trading range for today is between 7500.00 support and 8800.00 resistance.

USD/CHF:

Expected trend for today is bullish.

The USDCHF pair traded with strong positivity yesterday to test the key resistance 0.9675, which represents 61.8% Fibonacci correction level for the decline from 0.9976 to 0.9186, to keep the price stuck between the key levels represented by the mentioned resistance and 0.9581 support, which makes us continue with our neutrality until the price manages to breach one of the mentioned levels.

To review the details of the upcoming targets after the breach, please check our morning report.

The expected trading range for today is between 0.9580 support and 0.9740 resistance.

USD/CAD:

Expected trend for today is bearish.

The USDCAD pair showed more decline yesterday to keep approaching the main waited target at 1.2463, as the price falls under continuous negative pressure coming by the EMA50, noticing that stochastic loses its bullish momentum to approach the overbought areas.

Therefore, we will continue to suggest the bearish trend in the upcoming sessions conditioned by the price stability below 1.2717.

The expected trading range for today is between 1.2463 support and 1.2630 resistance.

DAX Index:

Expected trend for today is bullish.

The German index pulled back a little bit during the trading session on Monday, reaching down just below the €12,400 level. There is a lot of noise underneath, extending down to at least the €12,250 level. That is an area that should be massive support, based upon the action that we have seen over the last several days. Beyond that, I anticipate that the €12,000 level should be supportive, just as the uptrend line underneath will be. In other words, this is a very difficult market to envision breaking down, at least not until we clear the various support levels. I believe that the market should continue to be choppy, but when we pull back like this there should be buying opportunities.

We think you should probably be a bit cautious about building up the position, and therefore I would use small positions initially. I think that when we pull back like this, it should give us an opportunity to take advantage of value as the market participants have clearly decided that the uptrend line underneath should be very supportive. If we were to break down below the €11,800 level, the market would almost certainly unwind from here, perhaps reaching down to the €11,500 level, perhaps even the €11,000 level after that. Having said that, I believe it’s very unlikely and I think that it is more likely that we go much higher, and that we may have pulled back to resume the longer-term uptrend.

We wish you successful trading!