Forex Market Commentary
The Dow swoons again on the hint of a rate hike.
Down to close at 16,001.89 with -312.78 or -1.92% points shaved off on the session the Dow is in serious trouble of another rapid descent to the 15,000 mark. The cause? More jitters over interest rates; which leaves the trading community perplexed when Wall Street CEO's are ever going to come to terms with the fact that interest rates must rise sooner or later. Much deeper than Wall street's continued anxiety over interest rates is the the problem of slowing economic growth on a global scale. China is leading the way with drops in demand for commodities like crude oil, iron and nickel which is translating into lower revenue forecasts for commodity related corporations and hence a drop in share price, which then feeds off into lower US Dollar prices and lower bullion prices with fears of inflation almost vanished.
Read on Bloomberg the vast problems of the commodity traders:
http://www.bloomberg.com/news/articles/2015-09-28/with-glencore-commodity-rout-beginning-to-look-like-a-crisis
With the EUR/ USD strong resistance lies ahead at the 1.14 and support at the 1.10 with a bias to the upside with more short covering on open short positions due to the current Dollar woes off the back of a global slow down. Further resistance and support lies at the key 1.17 and 1.05 for major technical breakouts..
USDX has a bias for lower to the 93 mark failing to consolidate at 96 for another upward challenge on the 98.
Crude Oil should come under serious tests this week to stay above the 40 Dollar mark given the crisis in the commodities sector and needs see more encouraging news from China.
Gold Bullion needs to see a test of the 1120 to confirm a bearish bias whilst USD has run out of momentum as with commodities gold should come under selling pressure and needs stay above 1150 to confirm an upward bias.
In speaking of moving averages; markets are not rational and daily price action volatile, but in the longer run trader expectation and negative sentiment can be collectively summed up through the 50 day moving average. 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
95.894 -0.117 -0.15%
Support 94.569 Resistance 96.849
Forward 1 year - 95.534s.
95.894 -0.117 -0.15%
Support 94.569 Resistance 96.849
Forward 1 year - 95.534s.
EUR/USD
1.124350 +0.005550 +0.50%
Support 1.10853 Resistance 1.14673
Forward 1 year - 1.14840s.
1.124350 +0.005550 +0.50%
Support 1.10853 Resistance 1.14673
Forward 1 year - 1.14840s.
Crude Oil WTI
44.43 0.00 0.00%
Support 42.53 Resistance 48.11
Forward 1 year - 50.46s.
Forward 1 year - 50.46s.
Gold
1132.550 -12.850 -1.12%
Forward 1 year - 1,138.1s.
Pieter Bergli - DeLoren Trust Holdings
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