ActivTrades’ Market Analysts have prepared for LeapRate their daily commentary on traditional markets for August 15, 2019. See details below:
FOREX
The Euro is on the back-foot against other major currencies, noticeably the US Dollar, trading around the $1.11 level on Thursday morning. The perfect storm of risk constraining events (lingering trade tensions, weak Chinese and German data, inversion in the yield curve of 2 and 10-year treasuries to mention but a few) demonstrated that the market confidence in the single currency is at low levels. Typically, in such extraordinary circumstances, the Euro would be expected to assume the role of safe haven. However, this hasn’t been the case, indicating the markets unwillingness to seek refuge in the single currency, clearly preferring the Swiss Franc and the Yen.
Ricardo Evangelista – Senior Analyst, ActivTrades
GOLD
Gold remains steady at $1,510 with a very first support level at $1,500, while the area 1,530/1,535 represents a resistance level. After the big rally of the last few weeks, bullion is consolidating in this area, waiting for new market movers which to push higher. More in particular: any worsening of the trade battle or any further stock markets decline due to expectations of slower global economic growth, could be seen as a positive signal for gold. Another bullish element for the precious metal sector could also be dovish comments or decisions coming from central banks.
Carlo Alberto De Casa – Chief Analyst, ActivTrades
EUROPEAN SHARES
European shares opened higher, alongside U.S. Futures, but the bullish move was short-lived as most benchmarks pared gains minutes after, underlying the state of uncertainty still dominating stocks markets. President Trump’s delay on further tariff hikes against China had only a short-term positive effect on stocks as investors remain worried by signs of a looming recession in the bond market as showed a Treasury Yield-curve inversion. The veil of uncertainty surrounding markets combined with the low liquidity typical of August are making trading decisions particularly difficult this year.
Today’s data (U.S. Retail Sales + Philadelphia FED Manufacturing Index) is likely to be very important to traders: many will be hoping for reassuring numbers after the last round of disappointing numbers around the world. Investors will also take a close look at big corporations like Walmart and Alibaba as they will publish their quarterly results later in the day.
For now, European benchmarks are mixed. The only significant performance is that of the FTSE-MIB. The Italian index is down 2.50% due to political chaos un the country and with the decline led by the banking sector. Prices are trading slightly over the technical and psychological 20,000.0pts level where a break-out could lead the market to a deeper correction towards 19,850.0pts and 19,535.0pts by extension.
Pierre Veyret– Technical analyst, ActivTrades