Daily Market Review July 08



If the Nonfarm payrolls data tops the forecast today, the U.S. dollar may rise, as per analysis. A bullish NFP data will certainly offer some help to the greenback, while if so does happen, other major currencies will be worth a watch. An array of trading opportunities will be available today while ahead of the data release, markets will likely consolidate. As the NFP readings were too bearish last month, a surge is definitely welcomed and the forecast for today is of 175K.

All is not lost after the ‘Brexit’ decision as some U.S. investment banks might offer some support for London to maintain its major spot as a financial center. However, there was no agreement of jobs offer between the U.S. banks and British finance minister, George Osborn. Banks like JP Morgan, Bank of America Merrill Lynch, and Morgan Stanley are amongst the concerned U.S. banks. With second quarter earnings season to start this month, U.S. bank stocks may rise on this decision.

As trade deals hover on the global market, another major concern remains the price of crude. Crude prices plunged to a two-month lows yesterday despite a drawback in U.S. crude inventories, as a result of persisting supply troubles. Reports came in a day later than usual due to 4th July holiday and Brent crude futures were seen trading at $46.45 a barrel, down by 4.82 percent. By the side of the U.S., WTI crude futures closed down by 4.79 percent at $45.17 a barrel. UKOIL and USOIL can be traded in a lower margin today as prices are expected to remain around the same vicinity.

Technical Analysis:
As the U.S. dollar is expected to bounce higher today, the Euro will certainly get affected during the intraday trading. Traders are advised to closely monitor the current trading gap of the EURUSD from its actual trading spot and the support line of $1.1039. Currently, the pair hovers around the $1.108 level and is seen taking a downtrend towards the support line. Yesterday, the pair EURUSD commenced the session around the 1.109 level and fell to the 1.106 level to consolidate and move higher to the 1.109 level. The pair could not cross above the resistance line of 1.110 level and will remain closer to its channel of support.
Will the dollar rise back to its top form? So is the question dominating the major trading markets today. The USDJPY pair trends around the 100.4 level which is way down from normal trading margin of this pair. Yesterday, the pair USDJPY initiated the session around the 101.1 level and fell initially to the 100.7 level before regaining a slightly higher spot around the 101.1 level. The session closed at the 100.7 level and currently hovers around the same level. The Ichimoku cloud navigates above the cloud suggesting a consolidated mode before the data release today, but traders are warned of a probable change at the 100.9 level with an intersection of the Ichimoku lines scheduled for today. This is a decisive point for the pair to watch.

A hopeless GBPUSD may drag the traders away but at the same time it’s an on-going opportunity to reap from PUT options on shorter trading margins here. The pair adopted a consolidated mode since the beginning of this week and has kept trading within the 1.304 and 1.283 range. Same was seen yesterday with the pair commencing the session at the 1.291 level and closing at the 1.290 level. The Relative Strength index shows that the pair is currently holding on to small gains to stabilize around the RSI 47.8 level. There is no overbought nor oversold section to signal for the pair, while a rise in the USD today could cause the GBP to lag behind.

 

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