The sentiment was upbeat overnight; global equity benchmark indices rallied with US dollar. European benchmark indices up between 0.50%-0.80% overnight. Besides Nasdaq up by a percent, S&P and Dow Jones up by 0.85% each.
FX update: US 10year Treasury yield up 2bps closed at 2.43, and the dollar rose to a month high. We believe robust US data brings risk appetite. The US-China trade war has cooled down a bit compared to last week.
AUDUSD, EURUSD, and GBPUSD were among G10 currencies managed to hold the key support levels, so far. At close, the cable closed below 1.2700, its parallel support finds at 1.2660. We recommend taking profit on our short GBPUSD trade (given last Friday).
USDJPY, CADJPY and CHFJPY among JPY cross benefited overnight. CADJPY and CHFJPY closed above 20MA overnight, we expect USDJPY will follow soon.
1/2#CADJPY has completed the A-B-C corrective structure.
RSI and Oscillator have been recovering and remaining bullish.
Currently, trading at 82.00 on the verge of two-month descending TL.
Longer-term parallel support finds at 80.50. pic.twitter.com/XvzGklURAE
— KeytoMarkets (@KeytoMarkets) May 20, 2019
In AUD selling was witnessed across the board after RBA minutes and Lowe confirmed cutting rates could be possible.
Westpac said “Markets have moved from circa 25% priced to circa 90% priced for a cut in June” and also said, “It is now forecasting a rate cut in June and August, versus August and November.”
In commodities, Gold lost 3$ and Brent crude oil facing resistance at a triple top pattern and turning to cryptocurrency Bitcoin currently trading at 8k$ levels, developing a bullish H&S pattern on the H1 chart.
Intraday Key support levels:
Chart of the Day: Gold
What’s on today?
Looking at the day ahead, it’s not a busy day in Asia, but in Europe, we will get UK CPI.
It is important to always keep in mind the risks involved in trading with leveraged instruments.
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