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Crude Oil Rally Ends With A Thud

Crude oil futures tumbled Friday, giving back strong gains from earlier in the week amid concerns that next week’s OPEC meeting will fail to address the global supply glut.

Sept. WTI oil settles at $45.77/bbl, down $1.15, or 2.5%, on Nymex. Prices were down 2.1% for the week, tumbling from a 6-week high set Wednesday.

Reports suggest Saudi Arabia will insist on compliance from Libya and Nigeria, the two OPEC nations that have been thus far exempt from supply cuts.

Meanwhile, the U.S. rig count from Baker Hughes is due this afternoon, and may confirm U.S. production is finally slowing down due to stubbornly low oil prices.

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Criminals favor cash over cryptocurrencies


Many people believe that digital currencies suit perfectly for various criminal needs. Almost complete anonymity and no centralized authority should attract criminals. However, the data revealed by the European Commission points to a complete different situation.Experts found out that existing technical barriers prevent criminal minds from using cryptocurrencies on a large scale. The only exception is hackers who can overcome these hurdles easily. Laundering virtual money turned out to be complicated due to its high volatility. Besides, any operations with a digital currency require special knowledge. According to statistics, criminals prefer good old cash to electronic money.The report by the European Commission showed that people selling illegal goods still use cash. The more successful criminals are and the more goods they manage to sell, the more money they receive. That is why supply of cash still outpaces inflation rates despite available digital payment methods.The material has been provided by portal MT5.com – www.mt5.com

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US crude, gasoline stocks drop sharply


After numerous unsuccessful attempts, oil managed to hit a high of $50 a barrel. This time, it was really long and difficult climb. If not for the news about a drawdown in the US oil stockpiles, crude could reverse its trend.The Energy Information Administration reported a 4.7 million barrels draw in the US oil inventories. In addition, gasoline stocks also contracted. This became the main and almost the only reason for the price increase. There are no more positive data in the market. The news about a draw in oil stockpiles is a rare occasion, while reports on production growth are released regularly. The US steadily expands production as oil producers gradually increase the number of active operating rigs. Despite a drawdown, the volume of the US oil inventories is still close to record highs. In addition, growth in prices is hampered by violations of the terms of the OPEC deal to cut production. Not only some oil producers do not fully comply with their obligations but also Libya and Nigeria, which were released from any restrictions, significantly increased production.Given these circumstances and the general sentiment of market participants, we can expect a fall in oil prices in the nearest future.The material has been provided by portal MT5.com – www.mt5.com

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Dollar Sinks To Near 2-Year Low Against Euro

The dollar is losing ground against all of its major rivals Friday afternoon. The buck has been sinking against both the Euro and the Japanese Yen for the majority of the week and has now reached nearly a 2-year low against the Euro.

Political concerns have contributed to the dollar’s slide this week, as well as hawkish comments from European Central Bank Chief Mario Draghi, suggesting a possible policy tweak.

U.S. special counsel Robert Mueller is reportedly expanding the Russia probe to include Trump’s business transactions stoked worries about economic agenda.

Media reports suggested that Muller is examining a broad range of transactions involving Trump’s businesses as well as those of his associates.

Investigators are looking at Russian purchases of apartments in Trump buildings, Trump’s involvement in a controversial SoHo development with Russian associates, the 2013 Miss Universe pageant in Moscow and Trump’s sale of a Florida mansion to a Russian oligarch in 2008, according to the reports.

The International Monetary Fund on Thursday approved “in principle” a new loan worth $1.8 billion to Greece.

However, the arrangement has been approved in principle, which means it will become effective only after IMF receives specific and credible assurances from Greece’s European partners to ensure debt sustainability.

Further, a second executive board decision is needed to make the arrangement effective.

Greece’s debt remains unsustainable, the IMF noted. In the medium term, Athens needs to achieve primary surplus target of 3.5 percent of GDP. The dollar has tumbled to a nearly 23-month low of $1.1675 against the Euro Friday afternoon, from an early high of $1.1618.

The buck rose to an early high of $1.2952 against the pound sterling Friday, but has since eased back to around $1.30.

The UK budget deficit widened more-than-expected in June as debt interest increased notably after inflation lifted the cost of index-linked bonds.

Public sector net borrowing, excluding interventions, increased by GBP 2.0 billion from a year ago to GBP 6.9 billion in June, data from the Office for National Statistics showed Friday. The expected figure was GBP 4.9 billion.

The greenback has dropped to nearly a 1-month low of Y111.125 against the Japanese Yen this afternoon, from an early high of Y112.077.

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Cash becomes obsolete in China


The Chinese are doing away with cash actively. Taxi drivers, waiters and other professionals who like tips face a risk of losing a significant part of their earnings unless they get non-cash registers. Most citizens of large cities use their smartphones for purchase payments. At any shop, café, hair salon or a stall you can pay through WeChat or Alipay – the two most popular mobile wallet systems in China.Experts say that the transition from cash payments to non-cash ones is happening at a breakneck pace.  Just three years ago, this issue was out of question as the Chinese used cash only. Nowadays, the situation changed drastically. “From a tech standpoint, this is probably one of the single most important innovations that has happened first in China, and at the moment it’s only in China,” Richard Lim, managing director of venture capital firm GSR Ventures, said. According to the iResearch consulting firm, mobile payments in China hit the record level of $5.5 trillion which is about 50 times more than the size of the same US market, amounting to $112 million. As the most widely-used messengers are prohibited in China, the WeChat app has come to the fore.The material has been provided by portal MT5.com – www.mt5.com

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EUR extends gains (21.07.2017)



The single European currency came under the spotlight today, hitting the 2-year high against the US dollar.
The most traded currency pair touched 1.6600 and is still trading near this level. The euro surged against the greenback after the ECB policy meeting.
As widely expected, the European Central Bank voted to keep the key rate unchanged at the zero level. However, ECB President Mario Draghi said that the bank is likely to revise its monetary policy outlook this autumn. Traders took this statement as a hint of tapering the assets purchase program and hiking the interest rates in the nearest future. Besides, Mario Draghi said that the European economy is recovering moderately whereas the inflation is weakening. Next week the Eurozone will release some key macroeconomic data which may provide more clues about economic conditions in the region and help to understand whether the economy is ready to withstand tapering of the assets purchases program in September.
Forex analysts doubt that the ECB is ready to change its monetary policy stance. However, market participants succumbed to the effect of the European “mirage”, so the euro is likely to rise for a long period of time. https://www.instaforex.com

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China’s house prices rise by 0.7%


Chinese house prices were quite stable in June. In 70 largest Chinese cities, an average price for a new home grew by 0.7% from the prior month, the National Bureau of Statistics said. From June 2016, prices rose by 9.6%. A rise in house prices in June was recorded in 60 out of 70 largest cities versus 56 cities a month earlier. The rise in prices for private homes was observed in all 70 cities. On a year-on-year comparison, prices declined by between 0.8% and 5.5% in all of the 15 key Chinese cities in June.In May 2017, house prices in 9 out of 15 cities fell or were unchanged, while in other cities prices advanced. Meanwhile, the price growth was below 5%, the Xinhua news agency said.The material has been provided by portal MT5.com – www.mt5.com

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US Federal Reserve fines BNP Paribas $246 million


Paris-based lender BNP Paribas will pay $246 million to settle the Federal Reserve’s allegations of improper trading practices in currency markets. The Fed said that the bank was fined for “unsafe and unsound practices in the foreign exchange markets.” It also stressed that BNP Paribas must improve its control over foreign exchange trading.In May, the New York Department of Financial Services fined the French bank $350 million for similar allegations of currency market manipulation occurred between 2007 and 2013. Its traders allegedly used chat rooms to influence currency rates.  The new fine brings the bank’s bill for the misconduct to nearly $600 million, the Financial Times noted.The material has been provided by portal MT5.com – www.mt5.com

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USD/JPY analysis for July 21, 2017

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Recently, the USD/JPY pair has been trading downwards. As I expected, the price tested the level of 111.26. According to the 4H time frame, the price is still making lower highs and lower lows, which is a sign that sellers are in control. Strong breakout of a rising wedge in the background is a strong technical signal for a further downward move. My advice is to watch for potential selling opportunities. The downward targets are set at the price of 111.00 and 111.65.

Resistance levels:

R1: 111.68

R2: 112.00

R3: 112.20

Support levels:

S1: 111.15

S2: 111.95

S3: 110.60

Trading recommendations for today: watch for potential selling opportunities.

The material has been provided by InstaForex Company – www.instaforex.com

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EUR/USD analysis for July 21, 2017

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Recently, the EUR/USD pair has been trading upwards. As I expected, the price tested the level of 1.1676. According to the 15M time frame, I found broken yesterday’s high and a successful re-test, which is a sign that selling looks risky. My advice is to watch for potential buying opportuntiies. Another sign of strength is that RSI is rejecting from 50 level. The upward target is set at the price of 1.1675.

Resistance levels:

R1: 1.1650

R2: 1.1665

R3: 1.1675

Support levels:

S1: 1.1630

S2: 1.1620

S3: 1.1610

Trading recommendations for today: watch for potential buying opportunities.

The material has been provided by InstaForex Company – www.instaforex.com

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Кураж по-европейски: EUR продолжает дорожать (21.07.2017)



На валютном рынке сегодня главным героем является евро, который в паре с американским долларом достиг 2-летнего максимума.
Популярная на рынке Форекс пара вырвалась в зону выше уровня 1.1640. Причиной резкого роста евро против американского доллара стало заседание ЕЦБ по определению денежно-кредитной политики.
Как и ожидалось участниками рынка, процентная ставка европейского регулятора осталась на прежнем уровне 0%. Однако президент ЕЦБ Марио Драги указал на намерение Центробанка пересмотреть текущий курс монетарной политики этой осенью. Трейдеры восприняли эту информацию как намек на сворачивание программы количественного смягчения и последующее повышение процентной ставки.
Марио Драги отметил, что экономика еврозоны постепенно восстанавливается, тогда как инфляция в регионе, напротив, замедляется. На следующей торговой неделе будут опубликованы макроэкономические данные из еврозоны, которые способны указать на состояние экономики региона и проанализировать готовность экономики к сентябрьскому сворачиванию программы количественного смягчения.
Валютные стратеги отмечают, что пока сложно представить готовность ЕЦБ к каким-либо переменам в денежно-кредитной политике, однако участники рынка уже поддались влиянию европейского «миража», что будет оказывать поддержку евро на протяжении долгого времени. https://www.instaforex.com/ru/

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UK inflation slows to 2.6% in June


According to the Office for National Statistics, Britain’s consumer prices increased by an annualized 2.6% in June. From May, prices have been unchanged. Analysts had expected a 2.9% rise on a yearly basis, at the same pace as in the previous month, and a 0.2% increase month-on-month after prices rose by 0.3% in May.  The core consumer price index, which excludes food, alcohol, tobacco and energy prices, advanced by 2.4% from a 2.6% rise in May. The data was shy of analysts’ expectations for the flat reading. According to experts, the UK inflation has been above the Bank of England’s target level of 2% since February 2017. The slowing pace of inflation prevents the tightening of the monetary policy in the UK. This is largely due to the weakening of the British pound.The Bank of England’s Monetary Policy Committee (MPC) left its benchmark interest rate unchanged at 0.25%.Three out of eight MPC members voted in favor of the rate hike to 0.5%. The next bank’s meeting is scheduled for August 2-3. Then, the BoE will also unveil its economic forecasts. According to the ONS, the UK’s house prices grew at a much slower pace in May rising by 4.7% year-on-year. Food and non-alcohol prices edged down by 0.2% in June from the previous month. Prices for clothes and footwear fell by 1%, while prices for household goods went up by 0.4% and health services prices rose by 0.1%.The retail prices index (RPI) increased by 3.5% on a yearly basis and edged up by 0.2% from July. The RPI index is used by many British employers as a starting point in wage negotiation. The material has been provided by portal MT5.com – www.mt5.com

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Canadian Dollar Advances As CPI, Retail Sales Beat Forecasts

The Canadian dollar climbed against its major opponents in the European session on Friday, after better-than-expected domestic consumer price inflation for June and retail sales for May.

Data from Statistics Canada showed that consumer price index was flat on a seasonally adjusted monthly basis, following a 0.2 percent slide in May. Economists were looking for a 0.1 percent drop.

Core CPI, excluding food and energy, rose 0.2 percent on a seasonally adjusted monthly basis, from a 0.1 percent gain last month.

Retail sales increased for the third consecutive month, rising 0.6 percent to $48.9 billion in May.

This exceeded forecasts for a 0.3 percent uptick and follows a downwardly revised 0.7 percent increase in April.

Core retail sales, excluding motor vehicle and parts dealers, dropped 0.1 percent month-on-month in May, compared to a downwardly revised 1.3 advance in the previous month. The index was forecast to be flat.

Meanwhile, oil prices fell ahead of the OPEC meeting next week, when OPEC and Russia will meet in Moscow to discuss their supply quota plan.

Crude oil for September delivery fell $0.72 to $46.20 a barrel.

The loonie showed mixed performance in the Asian session. While the loonie dropped against the greenback and the euro, it held steady against the yen. Against the aussie, it rose.

The loonie advanced to 1.2546 against the greenback, off its early low of 1.2609. The next possible resistance for the loonie is seen around the 1.24 area.

Having fallen to a 9-day low of 1.4683 against the euro at 2:45 am ET, the loonie climbed to 1.4601. Continuation of the loonie’s uptrend may see it challenging resistance around the 1.45 mark.

The Survey of Professional Forecasters published by the European Central Bank showed that the Eurozone economy is forecast to expand at faster than expected pace.

SPF respondents lifted 2017 growth outlook to 1.9 percent from 1.7 percent and that for next year to 1.8 percent from 1.6 percent. Expectations for 2019 was raised marginally to 1.6 percent from 1.5 percent.

The loonie was trading in a positive territory against the aussie with the pair trading at 0.9955. This may be compared to a 3-day peak of 0.9920 set at 11:45 pm ET. Further uptrend may take the loonie to a resistance around the 0.97 region.

The Reserve Bank of Australia’s Deputy Governor Guy Debelle said that Australia’s interest rate need not increase automatically with the tightening of other central banks.

“Just as the policy rate in Australia did not need to decline to the very low levels seen in other parts of the world, the fact that other central banks increase their policy rates does not automatically mean that the policy rate here needs to increase,” Debelle said in Adelaide.

The loonie bounced off to 88.90 against the Japanese yen, from a 3-day low of 88.45 hit at 8:15 am ET. The loonie is likely to target resistance around the 92.00 level.

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