Daily Market Review January 12



Crude oil prices pursue their relentless plunge earlier today, by losing almost 20 percent of its value since the start of 2016. Traders and investors have now changed their course of action by predicting more falls, rather than hikes in crude prices. Forecasts show that, crude prices may go below $30 a barrel in the coming months. Despite a rout on the global market, accompanied by steep falls in prices, WTI contracts may benefit from a low price range. Currently, the WTI CLc1 stands at $30.66 a barrel, while on the other hand, Brent crude LCOc1 struggles at $30.72 a barrel.

Asian stock market navigates around a four-year low, while worries over China’s economic slowdown continue to spread on the market. Emerging markets are suffering the most, while markets might consolidate until further fundamental releases which may boost the market in time. MSCI’s shares outside Japan edged higher by 0.4 percent, but remained in a low position. Japan’s Nikkei was however seen falling by 1.3 percent, adding to a three-month low. Elsewhere, on the Wall Street, the S&P 500 was up by 0.1 percent, struggling to overcome previous bearish sessions.

Dollar rides on a continuous slide against a basket of currencies, but the strange part is that most of the currencies hold on to their bearish positions on the charts. Though, the greenback let the Yen lead the game on the USDJPY chart, the session remains in a somewhat large consolidated mode. The U.S. currency, was seen losing gains against the Euro and the Yen, which is keeping all eyes on the currency market, as investors wait for a boost. Ahead of FED’s next interest rate decision, currency charts will generate short-term volatility.

Technical Analysis:
Eurozone’s single currency is trying to lead the charts in here, with the greenback stepping back due to turmoil on the crude market. A risk-off atmosphere is helping the Euro stay steady against the dollar, which may definitely generate short-term trading opportunities. The pair EURUSD commenced the session around the 1.093 level and was brought down to the 1.091 level, within a few hours. After trying to gap higher the pair was eventually dragged further down to the 1.085 level. The session was closed around the 1.085 level, while today the pair has edged a little higher around the 1.088 level. Since economic releases are scarce for the Eurozone, verifying market trends would be wise to trade safely here.
The greenback is likely to remain in lower vicinity of the charts, until it gets boosted, however nothing yet can be seen helping the dollar. The Yen is getting all the attention here while a look at yesterday’s session shows that the pair initiated the session around the 117.05 level. The pair later tried to rise slightly to the 117.38 level. After being dragged a little down, the pair found enough momentum to jump higher around the 117.86 level. A consolidated mode was seen until the end of the session, with the pair closing the session around the 117.6 level. The Jolts job openings data is awaited later today, which may signal a boost for the USD today. Therefore, keep an eye on fundamentals to trade safely.

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The GBPUSD pair has lost complete momentum on the charts. Though the USD is a little weak since the beginning of this week, the GBP has been boosted enough. Given the strength of both the currencies, both of them resist and form a consolidated mode. Lack of fundamentals on the market is creating despair for both major currencies. The Ichimoku cloud hovers above the candles for the moment, which signals towards a bearish session for the day. Yesterday, the pair GBPUSD maintained a consolidated mode from the 1.452 level to the 1.454 level. The manufacturing production data is awaited for in UK today, which is expected to provide the expected boost for the pair, until then verify trends to trade safely here.

 

Economic Calendar