Brexit Agreement

Brexit Agreement on Table, Risky Assets Higher

Asian Indices ended mixed today as investors turn cautious amid confusing headlines around the Brexit agreement deal. Meanwhile, doubts emerged about the US and China partial trade deal. China wants to proceed with further discussions before signing the phase one trade deal.

Last week, Fed Chair Jerome Powell signalled further interest rate cuts and the resumption of bond purchases. Traders increased their bets that the Fed will slash interest rates at its next meeting in October to protect the economy from slowing growth and the effects of the trade tensions. The Hang Seng index is trading 0.69% higher at 26,848. The Shanghai Composite is 0.05% lower at 2,977, while in Singapore, the FTSE Straits Times is 0.27% lower at 3,126. The ASX 200 in Australia trades 0.3% higher at 6,684.

European indices started higher the day, DAX trading 0.92 higher at 12,786, CAC40 is 0.58 per cent higher at 5,730 while the FTSE MIB in Milan is 0.79 per cent higher at 22,604. In London, FTSE 100 is trading 0.67% higher at 7,216. UK is scheduled to leave the EU on October 31.

In commodities markets, crude oil trades 0.39 per cent lower at $53.15 as global growth worries weigh on crude. Brent oil is trading 0.20% lower at $59,30 per barrel as oil world supply will be affected by the global slowdown. Gold trades lower at 1,485, as the momentum turns bearish after the price trades below the 50-day moving average. On the upside, strong resistance will be met at 1,555.13 yearly high while support is at 1,458 the recent low.       

In cryptocurrencies, Bitcoin’s (BTCUSD) momentum is neutral now as BTC trades lower at 8,080, hitting the daily low at 7,899 and the daily high at 8,089. Bitcoin short term momentum is neutral now as it trades above the 200-day moving average. Immediate support for BTC stands now at $7,686 recent low, while the next support stands at 7,406 the low from June 2nd. On the upside, strong resistance now stands at 8,801 recent high and then at 9,000 round figure. Ethereum (ETHUSD) trades lower at 176,15 with capitalisation now to 19.26 billion, and on the upside, the immediate resistance stands at 317 high while the support stands at 136 the low from May 6th. Litecoin (LTCUSD) trades lower at 53.30. The crypto market cap capitalization now stands above $220.84 billion.

On the Lookout: The Australian unemployment rate fell from 5.3% to 5.2% with roughly 14,700 jobs added over the month. Yesterday, Japan Industrial Production (YoY) came in at -4.7% in line with forecasts for August. The Australian weekly consumer confidence came in at 110.9 previous reading was at 112.3. 

The central bank of China set the Yuan rate (USDCNY) at 7.0789 versus yesterday’s settlement at 7.0746.  

Trading Perspective: In forex markets, USD index trades 0.26 per cent lower at 97.72, the Aussie dollar trades 1.05 per cent higher at 0.6828, while NZDUSD trades 0.61% higher at 0.6329.

GBPUSD trades 0.48% higher at 1.2890 as we are getting closer to the Brexit deadline. Major support now stands at 1.2078 recent low which if broken, might accelerate the slide further towards 1.20. On the upside, immediate resistance now stands at 1.2988 recent high while more offers will emerge at 1.30 round figure.

In Pound futures markets open interest increased by 2,100 contracts, volume increased by around 8.300 futures contracts.

brexit deal agreement
EURUSD Daily Chart

EURUSD trades 0.37% higher at 1.1112 the pair trades for the sixth day out of the descending channel. Immediate resistance for the pair stands at 1.1137 the 100-day moving average. On the downside, immediate support stands at 1.1003 yesterday’s low and then at 1.0835 the low from 2017.

In euro futures markets open interest decreased by 5.100 contracts, the volume also decreased by around 5.800 futures contracts.

USDJPY is trading 0.01% lower at 108.77 having hit the daily low at 108.63 and the daily high at 108.93. USDJPY pair will find support at 104.44 the low from August 23rd. On the upside, immediate resistance for the pair now stands at 108.93 today’s high, and then at 109.06 the 200-day moving average. 

In Yen futures markets open interest increased by 88 contracts, volume increased by around 10,800 futures contracts.

brexit deal agreement
USDJPY Daily Chart

USDCAD is trading 0.20% lower at 1.3171 the pair will find immediate support at 1.3017 the YTD low while extra support stands at 1.30 round figure. On the upside, immediate resistance now stands at the 1.3356 high from September 3rd before an attempt to 1.3450 high from 31st May.