Weekly Market Report – 15.10.2018
CurrenciesEUR/USD – moved down as the USD was able to gain in strength even though the US data wasn’t that strong. However people are looking forward to President elect Trump’s press conference. The expectation is that he will more or less reiterate what he has been saying all along, and that would mean that there will be stimulus in the US. The World Bank has said that the policies, especially the proposed tax cuts could boost US as well as global growth.
USD/JPY – it appears there is some support at the moment around the 115 level as we have seen the price find a bottom there for 3 times over the past week or so. President elect Trump’s press conference could cause some safe haven buying so it will be important to keep a close eye on what he will be saying later today.
GBP/USD – almost broke below the 1.21 level, but was able to stay above that level, at least for now. There is still a lot of downwards pressure on the GPB as a hard Brexit seems all the more likely. We are also waiting for the British High Court to rule on whether Brexit requires parliamentary approval or not. We will have manufacturing production data out of the UK as well this morning.
USD/MXN – jumped up to a new record high as we will wait for the press conference of President elect Trump. Many are jumpy on what he will say, especially if there will be any reference to Mexico.
USD/TRY – also continues to climb, and each day it does so, it marks a new record high as well.
IndicesS&P 500 – ended the day slightly up as it was dragged down by the lower oil price and is dropping this morning. Perhaps that President elect Trump will be able to fire the US equity market up again today.
CommoditiesGold – has continued to move further up and is now nearing the resistance around the 1195 level and we are close to the 1200 level again which we left near the end of November. Today we will have a press conference of President elect Trump which could cause some volatility.
Natural Gas – weather forecasts changed a bit and that is the reason that we saw natural gas jump up yesterday.
Oil – extended its slide and dropped below the $51 a barrel for the first time in nearly a month, as fear of OPEC non-compliance is creeping back fast, mainly caused by Iraq and also the fact that the cuts are a process, as mentioned by the Kuwaiti Oil Minister. This comes even though the Iraqi oil minister said that they will comply with the agreement. However, exports from its southern ports are increasing so far and have reached record highs as mentioned yesterday. Today we have the EIA oil inventories as well in the afternoon and a build of 1.162M is expected, close to the API number of last evening of 1.5M. What could prove to be even more important is if the production in the US continued to increase. The EIA expects that US production will increase by over 100K bpd this year to reach the 9 mbpd again.