Daily Market Review August 31



The United-States may reach full employment and is very close to achieve this target as pointed out by Fed deputy chairperson, Stanley Fischer. No wonder why all eyes are currently glued on the US dollar and the expected readings of the nonfarm payrolls. However, no timing for an eventual raise in interest rates was clearly indicated by Fischer. On the other hand, the U.S. CB consumer confidence was seen hiking up surpassing expectations for the month of August, which is a good economical sign for the U.S.

In the wake of positive economic indicators obtained in U.S., the Wall-Street still incurred losses. The reason evoked behind this slump is that the market awaits for further cues on interest rates by the Fed. On this note, the Dow Jones Industrial Average fell by 00.29 percent while the S&P 500 dipped by 0.24 percent. Following the same trend, NASDAQ Composite was also down by 0.10 percent. Dragging the index NASDAQ down was Apple shares which fell by 0.82 percent.

The iPhone maker’s shares were down by 2.4 percent in pre-market trade on turnover of 158,000 shares. Yesterday Apple got ruled by Brussels and accused the tech giant of receiving illegal tax breaks from Ireland. So Apple is currently trending bearish which could provoke some bearish trends today and on the Asian trade, Gold prices fell as traders prefer to wait for more comments by the Fed on the much expected increase in U.S. interest rates. Catch the Eurozone CPI data, the U.S. ADP nonfarm employment change and U.S. crude oil inventories data today.

Technical Analysis:
The Euro edged lower against the US dollar on the EURUSD chart, signaling a consolidation which may be prolonged until the pair crosses above the support line of 1.119 level. A glance at yesterday’s session shows that the pair commenced the session at the 1.118 level and gradually fell to the 1.114 level. From there on, the pair consolidated in a specific range to close the session at the 1.114 level. Earlier today, the pair was seen incurring slight losses, while the Ichimoku cloud hovers above the candles suggesting a continuous bearish session. With the Eurozone CPI data awaited today at 09:00 GMT, keep an eye on this pair.

The Japanese Yen dipped against the USD, which explains the ascent of the USDJPY pair. Also, little gains for the US dollar after Yellen’s speech on Friday helped the pair to hike up. Ahead of the super important nonfarm payrolls data release on Friday, this pair is expected to remain slightly bullish. Much expectations relies on data releases such ADP nonfarm employment change data today at 12:15 GMT. The pair USDJPY session was initiated at 101.8 level yesterday and the pair was pushed up to the 103.08 level and closed around the same vicinity. The RSI indicator shows that the pair is stable around the 67.6 level and may consolidate up above or may move upwards if data obtained is positive today.
As the US dollar hikes up, the Pound Sterling was dragged lower against the USD, which has also been a result of continuing effects of the Brexit. Yesterday, the pair GBPUSD session started around the 1.310 level and fell to consolidate around the same region of the chart. The pair is likely to find support around the 1.311 level but currently the pair may not move ahead of this trading area. The GBPUSD pair is expected to tighten more post the ‘Brexit’ and the resistance level for this pair is up around the 1.323 level. Given the ascent of the USD, this pair may maintain its current trend, thus keep an eye on it.

 

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