06 September 2018

New US tariffs on China: Thursday and potentially Friday. In the past two months, the US imposed tariffs on $50 billion worth of Chinese goods. China retaliated with the same scale of duties. A major escalation is on the cards now. September 6th is the deadline for public comments on new tariffs worth a whopping $200 of Chinese products. China imports far less than it exports to the US and is set to hit back with levies of $60 billion of American products but may also cause other disruptions to US companies operating in China. There is always a chance of a delay or a deal, but the Trump Administration seems keen to move forward with a move that would serve as a significant disruption to the global economy. A risk-off atmosphere resulting from the tariffs is due to boost the US dollar and the Japanese yen. A de-escalation will do the opposite.

ADP Non-Farm Payrolls: Thursday, 12:15 ADP’s report for private sector jobs surprised to the upside in July with a gain of 219K positions, above the recent averages. A slower pace of hiring is likely now: 189K is projected.

ISM Non-Manufacturing PMI: Thursday, 14:00. The services sector saw slower growth than the manufacturing one back in July, with a score of 55.7 points. Growth is still OK according to this but businesses are less-optimistic than they sued to be. An increase to 57 points is on the cards for August. The report serves as a hint towards the Non-Farm Payrolls publication.

USD
New US tariffs on China
ADP Non-Farm Payrolls
ISM Non-Manufacturing PMI

  • EURUSD

Update: The pair started going up as expected. The daily chart shows that there is a potential that the pair could be forming a head and shoulders pattern. To be specific, the second shoulder is being formed and it is traded now just above the same price level of the first shoulder around 1.15. So, we will wait for the pair to show up some bullish evidence above the support level of 1.15 which in turn will help the Euro to gain value against the American dollar. According to this scenario, the pair might reach the level of 1.17 during the week conditioned by the continuation of trading above the level of 1.15.

Resistance levels: Support levels: Recommended:
▪ 1.21
▪ 1.1850
▪ 1.1780
▪ 1.15
▪ 1.1450
▪ 1.14
Waiting for the pair to show up some bullish evidence above the level of 1.15.
  • GBPUSD

Update: The pair went down for a short time then it is traded again just below the downtrend line. As could be seen on the daily time frame that the pair is traded below a strong resistance level that is the down trend line shown on the chart in blue. Therefore, we are short as long as the pair is traded below the downtrend line. Our first target is 1.2650.

Resistance levels: Support levels: Recommended:
▪ 1.36
▪ 1.35
▪ 1.31

▪ 1.2650
▪ 1.2550
We are bearish as long as the pair is traded below the down trend line.
  • GOLD

Update: We remain the same. As we mentioned last week the importance of the level of 1220 as a strong resistance level. The pair is still traded below that level and since it is traded below it, it is highly recommended to go short targeting the level of 1190 followed by 1180 during the week.

Resistance levels: Support levels: Recommended:
▪ 1330
▪ 1320
▪ 1220
▪ 1200
▪ 1190
▪ 1180
We are bearish as long as the pair is traded below the level of 1220.
  • AUDUSD

Update: We remain the same. The daily timeframe shows that the pair is traded bearishly. The pair is traded now above a strong support level that is 0.7160 so we find it a good opportunity to go short in case the pair goes up to be traded around the level of 0.7240. Will keep updating you regarding the pair’s movement.

Resistance levels: Support levels: Recommended:
▪ 0.7550
▪ 0.7600
▪ 0.7260
▪ 0.7160
▪ 0.71
We are bearish as long as the pair is traded below the level of 0.7240.
  • GBPJPY

Update: No changes. Still traded below the upside of the pattern. Having the pair traded within the descending channel is considered to be bearish. We think that it would be a good opportunity if we wait for the pair to reach the upside of the channel. This is where we can go short targeting the other side of the channel (the downside) in case the pair reaches the upside and shows up some bearish evidence.

Resistance levels: Support levels: Recommended:
▪ 156
▪ 155
▪ 146
▪ —
▪ —
▪ 140
Waiting for the pair to reach upside of the channel.

Disclaimer: The information contained in this publication is produced by Land-FX and not intended as an offer or solicitation for the purchase or sale of any financial instrument. Any opinion offered herein reflects Land-FX current judgment and may change without notice. This message is for information purposes only and is not intended as an offer, recommendation or solicitation to buy or sell, nor is it an official confirmation of terms. No representation or warranty is made that this information is complete or accurate. Any views or opinions expressed do not necessarily represent that Land-FX. This email and the information it contains may be confidential, proprietary or legally privileged. You must not, directly or indirectly, use, disclose, distribute, copy or store this message or any part of it if you are not the intended recipient. Unless otherwise stated, any pricing information given in this email is indicative only, is subject to changes and does not constitute an offer to deal at any price quoted.