America's Roundup: Dollar rises on trade war concerns, Wall Street rises, Gold drops, Oil little changed as U.S.-Iran dispute supports, trade war weighs-May 22nd, 2019

Market Roundup

• Fed officials see past misses as trouble for any new inflation approach

• Britain's May offers “new deal” to try to break Brexit deadlock

• JPMorgan raises its Brexit no-deal probability forecast to 25 from 15%

• US Apr Existing Home Sales, 5.19 mln, 5.35 mln forecast,, 5.21 mln previous

• US Apr Exist. Home Sales % Chg, -0.4%, 2.7% forecast,, -4.9% previous

Looking Ahead – Economic Data (GMT)

• 23:00 Japan May Reuters Tankan DI, 8 previous

• 23:50 Japan Mar Machinery Orders MM, -0.7% forecast,, 1.8% previous

• 23:50 Japan Mar Machinery Orders YY, -3.4% forecast, -5.5% previous

• 23:50 Japan Apr Trade Balance Total Yen, 203.2 bln forecast,, 527.8 bln previous

Looking Ahead – Events, Other Releases (GMT)

• N/A ECB Governing Council non-monetary policy meeting in Frankfurt

• 01:30 BOJ board member Yutaka Harada speaks to business leaders in Nagasaki, southern Japan

• 07:30 Welcome address by ECB's Draghi at the colloquium held in Frankfurt, Germany 

• 09:30 Participation by ECB chief economist Peter Praet in conversation at the ECB colloquium in Frankfurt, Germany 

• 14:00 Fed's John Williams speaks at an economic press briefing on the current and future outlook for U.S. home ownership, focusing on younger households, New York 

• 14:10 Fed's Raphael Bostic speaks before the “Technology-Enabled Disruption: Implications for Business, Labor Markets and Monetary Policy” conference hosted by the Federal Reserve Bank of Dallas 

• 18:00 BoE's Andy Haldane delivers a lecture on the Fourth Industrial Revolution on behalf of the Pro Bono Economics charity and thereafter participates in a panel discussion, London

• 18:00 Federal Open Market Committee will release the minutes from its April 30-May 1 policy meeting

Currency summaries

EUR/USD: The euro slipped lower against the U.S. dollar on Tuesday, after U.S. President Donald Trump temporarily eased curbs on China's Huawei Technologies Co Ltd. Trump added Huawei   to a trade blacklist last week, leading several companies to suspend business with the world's largest telecoms equipment maker, which could weigh on their sales. Chipmakers, many of which sell to Huawei, bore the brunt of Monday's sell-off. But late on Monday, the United States granted Huawei a license to buy U.S. goods until Aug. 19.The euro was down 0.02 percent at $1.1161. An index that tracks the dollar versus a basket of six major currencies was up 0.09 at 98.02 . Immediate resistance can be seen at 1.1187  (9 DMA), an upside break can trigger rise towards 1.1233  (50 DMA).On the downside, immediate support is seen at 1.1141 (Daily low), a break below could take the pair towards 1.1100 (Psychological level).

GBP/USD: The British pound declined against the dollar on Tuesday, as stronger dollar and Brexit uncertainty weighed on British pound. Prime Minister Theresa May set out a “new deal” on Tuesday for Britain's departure from the EU, offering sweeteners to Parliament including the chance to vote on whether to hold a second referendum to try to break the impasse over Brexit. The pound initially jumped on the news, then gave up the gains after it became clear that Parliament – which thus far has opposed a second public vote  would have to back any new referendum. Sterling was last trading at $1.2706, down 0.02 percent on the day.Immediate resistance can be seen at 1.2918 (9 DMA), an upside break can trigger rise towards 1.2925 (21 DMA).On the downside, immediate support is seen at 1.2681 (Daily low), a break below could take the pair towards 1.2600 (Psychological level).

USD/CAD:The Canadian dollar strengthened to an 11-day high against the greenback on Tuesday, as investors calculated that the threat of trade uncertainty would ease for Canada even as they ramped up on countries with close economic links to China. Investors were have worried that U.S. restrictions on Chinese telecoms equipment maker Huawei Technologies Co Ltd   would lead to an escalation in the trade tensions between Washington and Beijing. At (2125GMT), the Canadian dollar  was trading 0.2% higher at 1.3404 per greenback,. Immediate resistance can be seen at 1.3430 (5 DMA), an upside break can trigger rise towards 1.3554 (11 DMA).On the downside, immediate support is seen at 1.3375 (Higher Bollinger Band), a break below could take the pair towards 1.3300 (Psychological level).A break of the 1.3325 latter then targets the 2018 low.

USD/JPY: The dollar edged higher against  the Japanese yen on Tuesday, as Trade conflict between the United States and China pushed the U.S. dollar higher versus yen.The United States late on Monday allowed Huawei Technologies Co to buy U.S.-made goods until Aug. 19 in order to maintain existing telecoms networks and provide software updates to its smartphones, which helped global risk appetite to tick upward after being battered in the previous session .The dollar was last trading 0.01 percent  higher to the Japanese yen at 110.48. Strong resistance can be seen at 110.66 (21 DMA), an upside break can trigger rise towards 111.00 (Psychological level).On the downside, immediate support is seen at 110.00(5 DMA), a break below could take the pair towards 109.81 (61.8% retracement level). 

Equities Recap

European shares rose on Tuesday, with tech stocks contributing to gains as they recovered some ground lost in the previous session following a temporary easing of U.S. restrictions on China's Huawei.

The UK's benchmark FTSE 100 closed up by 0.2 percent, FTSEurofirst 300 ended the day up by 0.50 percent, Germany's Dax ended up by 0.9 percent, and France’s CAC finished the up by 0.4 percent.

Shares of technology companies helped lift Wall Street on Tuesday after the United States temporarily eased curbs on China's Huawei Technologies Co Ltd, alleviating investor concerns about pressure on future corporate results in the sector.

Dow Jones closed up by 0.78 percent, S&P 500 ended up 0.84 percent, Nasdaq finished the day up by 1.07 percent.

Treasuries Recap

U.S. Treasury yields edged higher on Tuesday, lifted by gains on Wall Street and higher overall risk appetite after the United States eased trade restrictions on Chinese telecommunications equipment maker Huawei Technologies.

In late trading, U.S. 10-year note yields rose to 2.429% from 2.414% late on Monday, after hitting a one-week high of 2.435%.

Yields on U.S. 30-year bonds advanced to 2.843% from 2.835% on Monday. The session high was a one-week high of 2.849%.

Commodities Recap

Gold prices dropped on Tuesday to the lowest in more than two weeks, as the dollar strengthened along with equities and other riskier assets ahead of the U.S. Federal Reserve's release of minutes from its latest meeting.

Spot gold fell 0.22% to $1,272.77 per ounce as of (2139 GMT). The session low of $1,268.97 was its lowest since May 3.U.S. gold futures settled down 0.3% at $1,273.20.

Oil futures were steady on Tuesday as the prospect of mounting U.S.-Iran tensions disrupting supply was offset by concerns that a lengthy trade war between Washington and Beijing would limit crude demand.

Brent crude futures settled at $72.18 a barrel, gaining 21 cents.U.S. West Texas Intermediate (WTI) crude futures settled at $62.99 a barrel, down 11 cents ahead of the front month contract for June delivery expiring on Tuesday. The July contract settled at $63.13 a barrel.

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