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- Varchev Finance: Trading day in one post – 13.07.2017
Varchev Finance: Trading day in one post - 13.07.2017
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Loading...Asian stock market: Asian stocks slipped on Monday as investors digested the release of a barrage of China economic data, shrugging off the gains seen stateside in the previous session. Hong Kong's Hang Seng Index shed 0.34 percent. Meanwhile, the Shanghai composite declined 0.59 percent as investors digested the release of a barrage of economic data, including second-quarter GDP growth of 6.7 percent which met expectations. South Korean stocks traded slightly lower, with the Kospi slipping 0.15 percent. Bank stocks declined, weighing on the broader index, but major technology names were mixed, with Samsung Electronics edging down by 0.65 percent but SK Hynix pulling back by 0.68 percent. In Australia, the S&P/ASX 200 lost 0.34 percent, with health care leading losses. Meanwhile, markets in Japan are closed for a holiday on Monday.
FX market: The EUR/USD daily Forex chart is now testing the bottom of the 3 day tight trading range from 2 weeks ago. The selloff lacks consecutive big bear bars. It is therefore more likely a leg in the 2 month range than a resumption of the May bear trend. The EUR/USD daily Forex chart is turning down from below the June 14 sell climax high. However, after the extreme parabolic wedge sell climaxes in May, the odds are that the 2 month trading range will continue. The minimum goal is the test of the June 14 sell climax high. While the daily chart has sold off for 4 days, it is in the middle of the 2 month range. There is additional support at the bottom of the 3 day tight trading range from 2 weeks ago. The odds are that the chart will begin to go sideways here and then have another leg up. Less likely, this 4 day selloff is a resumption of the May bear trend. But, the bears will need to get consecutive big bear bars to convince traders that the trend is resuming. In addition, they will need consecutive closes below the June low. Even if they get a breakout below and a 300 pip measured move down, a trading range late in a bear trend is usually the final bear flag. Therefore, traders will expect a reversal back up into this trading range within a couple of months.
Commodities market: Meanwhile, the dollar rose on Friday, trading near a 10-day peak after U.S. consumer prices data showed a build-up of inflation pressure that would allow the Fed to raise rates as many as four times this year. The U.S. Dollar Index that tracks the greenback against a basket of currencies was up 0.7% at 94.87 The dollar has benefited this week from the trade conflict concerns that emerged earlier, which ended up funneling safe-haven bids into the currency. On top of that, the U.S. economy has shown it is doing well and Treasury yields have risen, and these factors are all helping the dollar. On top of that, the U.S. economy has shown it is doing well and Treasury yields have risen, and these factors are all helping the dollar.
European stock market: Today European markets will open up with modest increases near unchanged levels. The main reason for this is uncertainty about the trade situation between the bloc and the United States. Over the weekend, Donald Trump called the EU "Vragh", which further strained relations between the two continents. Today there are no economic news from the region that can influence the markets, so investors remain focused on the Trump-Putin meeting.
U.S. stock market: The new week does not provide us with a lot of significant economic news, as it has been the case in the last few, but it does not mean it will be calm and quiet. The corporate season is undergoing, which is a sufficient prerequisite for good stock market movements and surprises. According to a large number of market participants, the Q2 season will be very favorable to cyclical companies where EPS growth of more than 20% will be within the range of normal. Despite the strong performance of technology companies, Morgan Stanley cut its forecasts for the technology sector and increased its expectations for the defense sector. According to the bank, the most profitable in Q2 were energy companies, technology companies, retailers, and mining companies. Since the commercial tariffs came into force a few days ago, we can not expect a significant impact on the sectors most exposed to the risk.
Economic calendar for the European and U.S. trading sessions:
12:00 Europe - Trade Balance
15:30 USA - Retail Sales
17:00 USA - Business Inventories
Trader Aleksandar Kumanov Read more:
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