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EUR/USD and Gold Await the ECB and Fed Chairman’s Speeches

EUR/USD and Gold Await the ECB and Fed Chairman’s Speeches

Equities rally on weaker risk-off sentiment and the greenback remains stable. How markets started this week?

The Chinese GDP (Q3) of 4.9% came in lower than expected of 5.2% however, this read was far better than the prior read of 3.2%. The Chinese industrial production of September climbed to 6.9% above the expected 5.8% and the prior print of 5.6%. Additionally, the Chinese Retail Sales of 3.3% came in better than expected of 1.8% and better than the prior of 0.5%. This data sends mixed signals about the Chinese economic recovery.

Equities

Hopes of a possible agreement on US fiscal stimulation and news about a possible registration of Pfizer Coronavirus vaccine have calmed down risk-off sentiment. Asian stock markets traded higher on Monday amid the better than expected industrial Chinese data.

The house speaker Nancy Pelosi stated that there are too many issues that should be agreed on with the White House however, they are not far from an agreement. Although, President Trump advisors said that it would be difficult to execute the relief package before the US elections.

Stock Market

Change %

S&P 500

-0.5%

Dow Jones

-0.01%

NASDQ

-0.9%

Japan 225

+0.1%

DAX 30

+1.1%

FTSE 100

+0.8%

CAC 40

+0.8%

EUR/USD and Main Currency Pairs

The greenback rose last week and closed on Friday in the green due to the risk-off sentiment in the market mainly from the delay in passing the US stimulus package and the increasing numbers of the Coronavirus in the US and Europe. Technically, the US Dollar index is still trading below 94.04 and this means that the index could fall towards 91.78.

The EUR/USD closed below the 50-day moving average reflecting bull’s weakness and tested 1.1713 twice. A daily close below that level could send the pair towards 1.1621.

The GBP/USD consolidated in the trading zone 1.2773- 1.3048. The price of the pair does not reflect at the moment any hard-Brexit risk as markets believe that the EU/UK will eventually end up with a deal. A daily close below 1.2773 may cause a further fall towards 1.2505.

Gold and Oil

Oil prices benefited from positive Chinese data showing a significant increase in industrial production. Technically, the Brent Crude rallied and remained above $42.50 last week however, the coronavirus increasing numbers in the US and Europe would keep any rally in check. The US Crude closed last week above the 50-day moving average and opened on Monday with an upward gap. A failure in closing above $42.23 could reverse the price’s direction towards $38.37.

The Gold traded in a sideways move creating higher lows with lower highs. A failure in closing above $1,921 could send the price for a test of $1,861/oz.

Looking Ahead

EUR/USD and Gold traders will follow the Fed Chairman Powell’s speech at 1:00 PM (GMT) and the ECB Lagarde’s speech at 1:45 PM. Investors will fallow also the Fed member William’s, Clarida, Bostic, and Harker's speeches at 3:00 PM, 4:45 PM, 7:20 PM, and 8:00 PM, respectively.

Maklumat/penyelidikan ini disediakan oleh Mahmoud Alkudsi dan tidak mengambil kira objektif pelaburan tertentu, keadaan kewangan atau keperluan khusus individu. Penganalisis penyelidikan bertanggungjawab terhadap kandungan laporan penyelidikan ini, samada sebahagian atau keseluruhannya, memperakui bahawa pandangan mengenai syarikat dan sekuriti mereka yang dinyatakan dalam laporan ini jelas mencerminkan pandangan peribadi dan pedagang bertanggungjawab sepenuhnya ke atas risiko mereka sendiri.

Penyelidikan yang disediakan bukanlah pandangan JME Financial Services (Pty) Ltd ataupun undangan untuk melabur dengan JME Financial Services (Pty) Ltd. Penganalisis penyelidikan juga memperakui bahawa tiada sebahagian daripada pampasannya, adalah, atau akan, secara langsung atau tidak langsung, berkaitan dengan cadangan atau pandangan tertentu yang dinyatakan dalam laporan ini.

Sehingga tarikh laporan diterbitkan, penganalisis penyelidikan dan pasangannya dan/atau saudara-mara yang bergantung kepada penganalisis penyelidikan, tidak memegang kepentingan dalam sekuriti yang dicadangkan dalam laporan ini (“kepentingan” termasuk pemilikan langsung atau tidak langsung terhadap sekuriti).

Penganalisis penyelidikan tersebut bukanlah di bawah JME Financial Services (Pty) Ltd. Anda digalakkan mendapatkan nasihat daripada penasihat kewangan bebas mengenai kesesuaian pelaburan, di bawah penglibatan berasingan, seperti yang anda anggap sesuai dengan objektif pelaburan tertentu anda, keadaan kewangan atau keperluan kewangan tertentu sebelum membuat komitmen untuk melabur.

Undang-undang Republik Afrika Selatan akan mengawal sebarang tuntutan yang berkaitan dengan atau yang timbul daripada kandungan maklumat/ penyelidikan yang disediakan.