17th August 2015 Currency markets, news and analysis

Forex Market Commentary  

A lack-lustre day with USDX, EUR/USD hardly moving although gold gain slightly and crude oil WTI now hits the 42 for a fresh low.  The Yuan devaluations has come and gone and most of the fall has hit Asian economies with the USD standing strong and Asian equities taking a tumble. there has been a lot of criticism leveled against the PBOC and many traders do not think that the devaluation is a good policy decision. Nevertheless some analysts point out that there is indeed a level of realism that needs to come to the fore which broadly hints at the overall Chinese economy being one big almighty over-valuation. "It's not that China is trying to intentionally lower the yuan long-term. It has just brought down the yuan in line with realistic levels as the yuan had been kept in a way artificially high," said Shuji Shirota, head of macro economic strategy group at HSBC in Tokyo.. read on Reuters - 

http://www.reuters.com/article/2015/08/18/us-markets-global-idUSKCN0QN02220150818?feedType=RSS&feedName=businessNews

Of real concern is crude oil WTI hitting the 42 mark with concerns that the asian market and China as a whole is slowing down with more alacrity:


On Reuters:

http://www.reuters.com/article/2015/08/18/us-markets-oil-idUSKCN0QN00Z20150818?feedType=RSS&feedName=businessNews 


Not only that where a matter of 4 weeks we were talking about hawks clamoring for 50 basis points rise; traders are now worried about the knock on effects of China to US markets, in particular equities and that overall this economic expansion of the last few quarters looks like it is fast becoming a false horizon.

Read on the Wall Street Journal a negative point of view over the US economy state of health and it needs to be understood that there are elements of truth here as all eyes watch the fall out in US equties:

http://www.wsj.com/articles/u-s-lacks-ammo-for-next-economic-crisis-1439865442?mod=pls_whats_news_us_business_f 



Important moving averages:

USDX  at the 50 day m.a 96.
EUR/ USD above 50 day m.a at 1.10
Crude Oil WTI below 50 day m.a. at 52
Gold below 50 day m.a. at 1140
US - 30 DAY FED FUND below 50 day m.a. at 99.78
US - 10 YEAR T-NOTES above 50 day m.a at 126.5

Overall reflection:  all eyes on China now and the slowing economy and posible effects on USD GDP with US equties in retreat.

Always look to support and resistance band lines as the key to understanding in the long and short term where prices are converging. Professional technical traders use 50 day and 200 day medium and slow moving averages as fundamental cornerstones for interpreting the direction of price action.

USDX

US Dollar
96.965     +0.150 +0.19%
Support 95.839 Resistance 97.015
Forward 1 year - 97.273s.

EUR/USD
1.105820     -0.002175 -0.20%
Support   1.10487      Resistance 1.12307
Forward 1 year - 1.14160s.  

Crude Oil  WTI

42.26     -0.15 -0.35%

Support 40.66  Resistance  43.88
Forward 1 year - 51.17s.

Gold

1118.850     +0.085 +0.01%

Support  1,105.3     Resistance 1,123.5
Forward 1 year  -  1,119.1s.

Pieter Bergli - DeLoren Trust Holdings

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