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GBP/USD Technical Analysis: Sterling confined in a small range near 1.2800 figure
GBP/USD Technical Analysis: Sterling confined in a small range near 1.2800 figure

GBP/USD Technical Analysis: Sterling confined in a small range near 1.2800 figure

February 16, 2019 09:33   FXStreet   Market News  

GBP/USD daily chart

  • GBP/USD is trading in a bear trend below the 200-day simple moving average (SMA).

GBP/USD 4-hour chart

  • GBP/USD is trading below its main SMAs suggesting bearish momentum in the medium-term.

GBP/USD 30-minute chart

  • GBP/USD is trading between the 50 and 100 SMA suggesting a sideways to a bearish market. 
  • To the downside, support is seen at 1.2780 and 1.2740 level
  • Newt week bulls will likely try to break above 1.2880 to reach 1.2960 figure to the upside.

Additional key levels

GBP/USD

Overview:
    Today Last Price: 1.2818
    Today Daily change: 26 pips
    Today Daily change %: 0.20%
    Today Daily Open: 1.2792
Trends:
    Daily SMA20: 1.299
    Daily SMA50: 1.2821
    Daily SMA100: 1.2879
    Daily SMA200: 1.301
Levels:
    Previous Daily High: 1.2878
    Previous Daily Low: 1.2773
    Previous Weekly High: 1.3103
    Previous Weekly Low: 1.2854
    Previous Monthly High: 1.3214
    Previous Monthly Low: 1.2438
    Daily Fibonacci 38.2%: 1.2813
    Daily Fibonacci 61.8%: 1.2838
    Daily Pivot Point S1: 1.2751
    Daily Pivot Point S2: 1.2709
    Daily Pivot Point S3: 1.2645
    Daily Pivot Point R1: 1.2856
    Daily Pivot Point R2: 1.292
    Daily Pivot Point R3: 1.2962

 

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US Pres. Trump: Steel tariffs are working
US Pres. Trump: Steel tariffs are working

US Pres. Trump: Steel tariffs are working

February 16, 2019 09:03   FXStreet   Market News  

Additional comments from the U.S. President Trump continue to cross the wires with key quotes, via Reuters, found below.

  • Steel tariffs are working.
  • Expecting legal action to challenge the national emergency; likely to end up in the supreme court.

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Gold retreats from February highs, trades near $1315 as US stocks post strong gains
Gold retreats from February highs, trades near $1315 as US stocks post strong gains

Gold retreats from February highs, trades near $1315 as US stocks post strong gains

February 16, 2019 08:53   FXStreet   Market News  

  • Wall Street starts the day on a strong note on renewed trade optimism.
  • US Dollar Index pulls away from 2019 highs, steadies above 97.

The XAU/USD pair rose to its highest level of February near $1320 in the early NA session but lost its traction as the improved market sentiment made it difficult for the safe-haven precious metal to preserve its strength. As of writing, the pair was trading a little above $1315, adding 0.25% on a daily basis.

Chinese news agency Xinhua today reported that the U.S. and China were moving closer to a final deal and explained that both sides reached consensus in principle on major issues and “had specific discussions about a memorandum of understanding on bilateral economic and trade issues.”  

Later in the day, President Trump said that they were closer to have a real trade deal with China than the U.S. ever was and announced that he will be meeting his Chinese Counterpart Xi after the talks in Washington next week. Boosted by the improved market sentiment, major equity indexes in the U.S. started the day in the positive territory and continued to push higher. At the moment, the Dow Jones Industrial Average and the S&P 500 area adding 1.35% and 0.8%, respectively.

Meanwhile, today’s disappointing industrial production data from the U.S. weighed on the greenback and forced the US Dollar Index to ease from the 2019-high that it set earlier in the session. Nevertheless, the DXY remains on track to post weekly gains for the second straight week.

Technical levels to consider

The pair could face the initial support at $1310 (daily low/20-DMA) ahead of $1300 (psychological level) and $1293 (50-DMA). On the upside, resistances are located at $1320 (daily high), $1326 (Jan. 31 high) and $1332 (Apr. 24, 2018, high).

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Fed’s Bostic: In no rush to arrive at neutral rates
Fed’s Bostic: In no rush to arrive at neutral rates

Fed’s Bostic: In no rush to arrive at neutral rates

February 16, 2019 08:33   FXStreet   Market News  

Atlanta Fed President Raphael Bostic was out on the wires in the last minutes, arguing that the policy rate was a little short of the neutral level but added that they were in no rush to arrive there. Echoing his comments from earlier this week, Bostice said that he favouring one rate hike both in 2019 and 2020.

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United States Baker Hughes US Oil Rig Count increased to 857 from previous 854
United States Baker Hughes US Oil Rig Count increased to 857 from previous 854

EUR/USD recovers above 1.13 as greenback loses strength
EUR/USD recovers above 1.13 as greenback loses strength

EUR/USD recovers above 1.13 as greenback loses strength

February 16, 2019 07:53   FXStreet   Market News  

  • Mixed data from the U.S. weighs on the greenback.
  • Trade surplus narrows in the euro area.
  • EUR/USD looks to finish the second straight week in the red.

The EUR/USD pair slumped to its lowest level since mid-November at 1.1235 earlier in the day as the rising US T-bond yields boosted the demand for the greenback and weighed on the pair. After finding support near that mentioned level, the pair staged a modest recovery in the NA session and erased a large part of its daily losses. As of writing, the pair was trading at 1.1303,adding only 0.04% on a daily basis. If the pair fails to hold above 1.13 at the end of the session, it will close the week below that level for the first time since June.

The data published by the Eurostat today showed that the trade surplus in the euro area narrowed to €17 billion in December from €19 billion in November. Later in the day, while speaking at an event,  European Central Bank board member Benoit Coeure said that the slowdown in the eurozone was clearly stronger and broader than expected. Coeure further added that the ECB has recently discussed the possibility of a new TLTRO to further weigh on the shared currency.

In the second half of the day, the greenback gained traction after the 10-year US Treasury bond yield rose sharply on the back of renewed U.S. – China trade optimism. Moreover, the New York Fed’s Empire State Manufacturing Index improved to 8.8 in February to surpass the market expectation of 7. However, other data from the U.S. showed that the industrial production in January declined by 0.6% and the capacity utilization fell to 78.2% from 78.8% to force the greenback to lose its bullish momentum. The US Dollar Index, which advanced to a fresh 2019 high of 97.37, was last seen down 0.1% on the day at 96.90. Investors may also be looking to book their profits ahead of the weekend and bring in some extra selling pressure on the buck. 

Technical outlook by FXStreet Chief Analyst Valeria Bednarik

The bearish case is stronger in the daily chart, as the price is below all of its moving averages which maintain strong downward slopes. The closest is the 20 DMA at 1.1365. The Momentum indicator heads lower in negative levels and at its lowest for this year, while the RSI lacks directional strength, consolidating around 40.

Supports from the current level came at 1.1250 and 1.1215, the low set in November 2018, with a break below this last anticipating a steeper decline first toward 1.1160 and later toward the 1.1100 figure. The 1.1300 figure is offering an immediate resistance ahead of this week high of 1.1341. Beyond it, the recovery could extend up to 1.1400, where selling interest is expected to return.

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Oil: Prices are undervalued given the current supply uncertainty – Rabobank
Oil: Prices are undervalued given the current supply uncertainty – Rabobank

Oil: Prices are undervalued given the current supply uncertainty – Rabobank

February 16, 2019 07:33   FXStreet   Market News  

“The oil market is setting up for further gains this week after posting another series of higher highs and higher lows,” argued Rabobank research team. “Supply-side worries have increased on the margin and geopolitical risk from Venezuela, Iran, Libya and Nigeria is starting to get priced in to the futures curve along with a slowdown in US production growth.”

Key quotes

“Looking forward we remain highly convicted that prices are undervalued given the current supply uncertainty. The geopolitical risk premium in the market is increasing but has yet to be fully priced in our view. Our base case forecast is for Brent to be trading in the high-60s in the coming days with upside risks should we see further disruption to supplies.”

“Market technicals are also pointing to further upside as we breakout from the coiling pattern we have been in for the last four weeks and momentum buyers flip from short to long. The 200-day moving average of $71.41 in the prompt Brent continuous contract should provide strong resistance above, but that still leaves another $6/bbl before we test those levels.”

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United States Net Long-Term TIC Flows down to $-48.3B in December from previous $31.3B
United States Net Long-Term TIC Flows down to $-48.3B in December from previous $31.3B

United States Total Net TIC Flows dipped from previous $42B to $-33.1B in December
United States Total Net TIC Flows dipped from previous $42B to $-33.1B in December

United States Total Net TIC Flows fell from previous $42B to $-48.3B in December
United States Total Net TIC Flows fell from previous $42B to $-48.3B in December

GBP/USD rises further to the 1.2900 area, trims weekly losses
GBP/USD rises further to the 1.2900 area, trims weekly losses

GBP/USD rises further to the 1.2900 area, trims weekly losses

February 16, 2019 06:03   FXStreet   Market News  

  • Cable extends gains late on Friday, still down for the week. 
  • China-US talks, Brexit, FOMC minutes and UK jobs numbers to be key drivers next week. 

The US dollar pulled back further during Friday’s American session, pushing GBP/USD to the 1.2900 area. Cable hit a 2-day high at 1.2895 and it was about to end the week hovering around 1.2885, a daily gain of almost a hundred pips but 50 pips below the level it had a week ago. 

The Brexit uncertainty and the defeat of the UK Prime Minister in House of Commons were the major drivers of the market sentiment over the past week and Brexit headlines are poised to remain the major factor of the currency move in the upcoming week as well”, said Mario Blascak, FXStreet’s European Chief Analyst.

Data from the US and the UK over the week showed a mixed bag of numbers. The negative surprises from the US weigh on the greenback. In the US, next week FOMC minutes are due while in the UK, labor market figures will be released. China-US talks will continue and also the Brexit drama. 

In the UK, with six weeks to Brexit day, focus remains on the negotiations. While most would have preferred more clarification by now, it is unsurprising that they are dragging on. It is normal in political negotiations to get much closer to the deadline before
politicians are willing to compromise. PM Theresa May will continue talks with the EU27 in late 
February, when she has also promised a new Brexit vote”, wrote Danske Bank analysts. 

GBP/USD Short-term levels to watch 

Friday’s rally could signal some short-term bottom for the pair particularly if it manages to rise back above 1.2910. The next key resistance is the 1.3000 area. On the downside, below 1.2890 the bearish pressure is likely to intensify. 

GBP/USD

Overview:
    Today Last Price: 1.2885
    Today Daily change: 0.0093 pips
    Today Daily change %: 0.73%
    Today Daily Open: 1.2792
Trends:
    Daily SMA20: 1.299
    Daily SMA50: 1.2821
    Daily SMA100: 1.2879
    Daily SMA200: 1.301
Levels:
    Previous Daily High: 1.2878
    Previous Daily Low: 1.2773
    Previous Weekly High: 1.3103
    Previous Weekly Low: 1.2854
    Previous Monthly High: 1.3214
    Previous Monthly Low: 1.2438
    Daily Fibonacci 38.2%: 1.2813
    Daily Fibonacci 61.8%: 1.2838
    Daily Pivot Point S1: 1.2751
    Daily Pivot Point S2: 1.2709
    Daily Pivot Point S3: 1.2645
    Daily Pivot Point R1: 1.2856
    Daily Pivot Point R2: 1.292
    Daily Pivot Point R3: 1.2962

 

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US: Data disappointments could become more common, USD investors should take note – CIBC
US: Data disappointments could become more common, USD investors should take note – CIBC

US: Data disappointments could become more common, USD investors should take note – CIBC

February 16, 2019 05:53   FXStreet   Market News  

Andrew Grantham and Royce Mendes, analysts at CIBC point out that US data disappointment, like the recent retail sales report, could become more common and hit the US dollar. 

Key Quotes: 

“While bond yields remained lower, the US$ quickly recovered the ground it lost immediately after December’s ugly retail sales report. It’s true that we should never read too much into just one bad number, particularly in the highly revised advance retail print, but even if we add the largest revision seen in recent years it would still be a disappointing result.”

“And with our expectations that the US economy will slow this year, as others such as the EZ begin to see a stabilization in growth rates, data disappointments could become more common in the US and dollar investors should certainly take note.”

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