ActivTrades’ Market Analysts have prepared for LeapRate their daily commentary on traditional markets for August 14, 2019. See details below:
FOREX
The Yen is currently the most remarkable story in the FX space, as we go through the usual mid-August low liquidity patch. The Japanese currency continues to appreciate against the other majors, noticeably the Dollar and the Euro. The Yen, traditionally seen as a refuge asset, is still rising despite the good news that American tariffs on Chinese imports were to be postponed, which inspired a rally in risk related instruments, with indices like the S&P gaining over a percentage point during Tuesday’s session..The weak Chinese data published overnight, showing the worst industrial output figures in 17 years, appears to have kept the market sentiment in check and this perhaps explains the rise of the Yen.
Ricardo Evangelista – Senior Analyst, ActivTrades
EUROPEAN SHARES
European stocks opened mixed today, paring part of yesterday’s gains after economic data disappointed investors. Market appetite for riskier asset had been boosted following President Trump’s decision to delay the 10% tariff hike on the remaining $300bn of Chinese good coming to US, a very unexpected decision in an uncertain climate on the financial markets. Beijing also confirmed talks were still on track with Washington after a “productive call” took place between the two blocs, confirming their willingness to stick to the September talks. However, investors remain very concerned by the negative effects this trade dispute is having around the globe as more and more poor economic data piles up: Chinese Industrial Production and Retail Sales disappointed traders while Germany showed a GDP contraction (-0.1%).
Traders will now wait for the European GDP release, due later today, and for the US Jobless claims data due tomorrow. In the meantime, earnings season continues with Tencent, Alibaba, Cisco, Nvidia, Swisscom and Carlsberg publishing their results today. Technically, the correction observed on European benchmark remains small for now, traders will have to wait for a break-out of strong technical levels to expect a deeper bearish move.
DAX-13 chart
Pierre Veyret– Technical analyst, ActivTrades
GOLD
The area of $1,530 has temporarily arrested the gold rally, proving to be a first resistance level in the way of bullion. Some investors are taking profit after the long bullish rally, while Donald Trump’s decision to postpone after Christmas the new tariff against China curbed the risk-off scenario. The price is now playing near the $1,500 level, with a main trend that still appears positive as investors are betting on gold after the new dovish moves of many central banks.
Gold chart
Carlo Alberto De Casa – Chief Analyst, ActivTrades