China’s senior party official for economic affairs:

• China’s economic recovery is not strong enough
• Need to implement
  macro policies more effectively
• Should speed up the
  issuance and use of special bonds
• Should give full
  play to the role of fiscal funds in leveraging economic growth and
  structural adjustment
• Monetary policy
  should be flexible, moderate, accurate and effective
• Maintain reasonable
  and abundant liquidity
• Should increase
  policy support so that enterprises and consumers tangibly benefit
• Make good use of
  funds from ultra-long term special bonds
• Should increase
  residents’ property income through multiple channels
• Will improve the
  long-term expansion of consumption
• Will improve the
  mechanism for promoting high-quality full employment

More now from China. While again lacking in detail these comments seem a little more targeted.

This article was written by Eamonn Sheridan at www.forexlive.com.

Careful on this folks. Kishida sounds like he is not happy with the weak yen. Reuters conveying report in Kyodo news:

• Govt must be vigilant about impact of rising prices, driven in part
  by weak yen, on economy to achieve domestic-demand driven recovery
• Says need to be
  cautious about effects of rising prices due to weak yen

I posted earlier on the dissatisfaction of prices rising due to ‘cost push’ factors, the weak yen being part of this. If you missed it, here:

• Economic calendar in Asia – Friday, 19 July 2024 – Japan inflation data for June

Kishida expressing the same.

This article was written by Eamonn Sheridan at www.forexlive.com.

Will Biden go or stay is the hot topic on media, social and otherwise.

WSJ latest headline.

Let’s see if there is more to come. Hope not 😉

This article was written by Eamonn Sheridan at www.forexlive.com.

US Markets Hit Again – Dow Down 1.3%

US Stock markets took another tumble off historic highs in trading yesterday as investors continued to reevaluate their portfolios. The blue-chip Dow took a heavy hit after breaking to new highs in recent days, losing 1.29% on the day followed by the S&P and Nasdaq which dropped 0.77% and 0.70% respectively. The Euro ultimately fell on the day after the ECB held rates steady as was widely expected, however the move came more on US dollar strength after stronger US data as the single currency gained on most of the crosses. US Treasury yields gained after the data, the 2-year adding 3.4 basis points up to 4.463% and the 10-year pushing 4.4 basis points higher to close at 4.190%. Oil prices were steady and closed close to flat, whilst Gold dropped lower again in line with the stronger greenback, losing 0.54% on the day to finish at $2,224 an ounce.

Impact of Joe Biden Dropping from the US Election

Calls for Joe Biden to step down from the race for the next president of the United States have been increasing over recent days and traders are now setting themselves to react if this eventuality does occur. Most investors expect that we will see some immediate defensive positioning in the market if Joe Bide does pull back, this will probably see flows into traditional haven products like Gold, the Yen, the Swiss franc and the dollar. However, many suspect that the impact will be relatively short lived as there has been plenty of news column inches devoted to this happening and then the “Trump Trade” will take precedence as the likelihood of Trump becoming the next president is likely to increase further. This is also seen as dollar positive and could explain last nights strengthening of the greenback, so for the next few sessions the old adage of ‘Buy dollars, wear diamonds’ may be true once again.

Volatile Trading Day to Close out the Week

The macroeconomic calendar is actually relatively light today but given the moves on Wall Street overnight and the potential for more geopolitical influences on the market today, traders are expecting volatility to remain high as we head into the weekend. Asian markets are set to open on the back foot after Wall Street saw losses across the major indices and there is little on the event calendar to change sentiment. We do have key Retail Sales numbers due out later in the day from both the UK and Canada and these prints should increase volatility in the pound and Loony. There are no significant US data releases today but we do hear from FOMC members Williams and Bostic later in the day which could influence Fed rate expectations.

The post General Market Analysis 19/07/2024 first appeared on IC Markets | Official Blog.

DXY (US Dollar Index):

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Factors contributing to the momentum: Price is below the bearish Ichimoku cloud.

Price could potentially make a bearish reaction off pivot and drop to 1st support.

Pivot: 104.46
Supporting reasons: Identified as a swing high resistance level, specifically at the 38.20% Fibonacci Retracement, indicating a potential area where sellers could enter the market after a retracement.

1st support: 103.68
Supporting reasons: Identified as a multi-swing low support level, suggesting a significant area where previous declines have found support.

1st resistance: 105.14
Supporting reasons: Identified as a pullback resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.

EUR/USD:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Factors contributing to the momentum: Price is above the bullish Ichimoku cloud.

Price could potentially make a bullish bounce off pivot and head toward 1st resistance.

Pivot: 1.0858
Supporting reasons: Identified as an overlap support level, specifically at the 127.20% Fibonacci Extension, indicating a potential area where buyers could enter the market after a retracement.

1st support: 1.0796
Supporting reasons: Identified as an overlap support level, specifically at the 50% Fibonacci Retracement, suggesting a significant area where previous declines have found support.

1st resistance: 1.0915
Supporting reasons: Identified as a pullback resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.

EUR/JPY:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off pivot and drop to 1st support.

Pivot: 171.42
Supporting reasons: Identified as an overlap resistance level, indicating a potential area where sellers could enter the market after a retracement.

1st support: 169.94
Supporting reasons: Identified as an overlap support level, suggesting a significant area where previous declines have found support.

1st resistance: 173.52
Supporting reasons: Identified as an overlap resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.

EUR/GBP:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off pivot and drop to 1st support.

Pivot: 0.8431
Supporting reasons: Identified as a pullback resistance level, specifically at the 38.20% Fibonacci Retracement, indicating a potential area where sellers could enter the market after a retracement.

1st support: 0.8387
Supporting reasons: Identified as a multi-swing low support level, suggesting a significant area where previous declines have found support.

1st resistance: 0.8461
Supporting reasons: Identified as an overlap resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.

GBP/USD:

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could potentially make a bearish break off pivot and drop towards 1st support.

Pivot: 1.2943
Supporting reasons: Identified as a pullback resistance level, indicating a potential area where sellers could enter the market after a retracement.

1st support: 1.2862
Supporting reasons: Identified as a pullback support level, specifically at the 38.20% Fibonacci Retracement and 161.80% Fibonacci Extension, indicating Fibonacci confluence and suggesting a significant area where previous declines have found support.

1st resistance: 1.3033
Supporting reasons: Identified as a swing high resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.

GBP/JPY:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off pivot and drop to 1st support.

Pivot: 204.09
Supporting reasons: Identified as an overlap resistance level, indicating a potential area where sellers could enter the market after a retracement.

1st support: 201.42
Supporting reasons: Identified as an overlap support level, suggesting a significant area where previous declines have found support.

1st resistance: 206.11
Supporting reasons: Identified as an overlap resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.

USD/CHF:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off pivot and drop to 1st support.

Pivot: 0.8891
Supporting reasons: Identified as a pullback resistance level, specifically at the 50% Fibonacci Retracement, indicating a potential area where sellers could enter the market after a retracement.

1st support: 0.8827
Supporting reasons: Identified as a multi-swing low support level, suggesting a significant area where previous declines have found support.

1st resistance: 0.8949
Supporting reasons: Identified as a pullback resistance level, specifically at the 78.60% Fibonacci Retracement, indicating a historical point where previous rallies have faced selling pressure or reversed.

USD/JPY:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off pivot and drop to 1st support.

Pivot: 157.68
Supporting reasons: Identified as a pullback resistance level, specifically at the 61.80% and 38.20% Fibonacci Retracement, indicating Fibonacci confluence and a potential area where sellers could enter the market after a retracement.

1st support: 155.76
Supporting reasons: Identified as a multi-swing low support level, suggesting a significant area where previous declines have found support.

1st resistance: 159.32
Supporting reasons: Identified as an overlap resistance level, specifically at the 61.80% Fibonacci Retracement, indicating a historical point where previous rallies have faced selling pressure or reversed.

USD/CAD:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could fall towards the pivot and potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot:1.3699
Supporting reasons: Identified as a pullback support, suggesting a potential area where buying interests could pick up to resume the uptrend. The presence of an uptrend channel adds further significance to the bullish momentum.

1st support: 1.3663
Supporting reasons: Identified as an overlap support that aligns close to a 38.2% Fibonacci retracement level, suggesting a potential area that could halt further downward movement.

1st resistance: 1.3752
Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

AUD/USD:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price is trading close to the pivot and could potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 0.6701
Supporting reasons: Identified as an overlap support, indicating a potential zone where buying interests could pick up to stage a minor rebound.

1st support: 0.6643
Supporting reasons: Identified as a pullback support, suggesting a potential area where price could find strong support.

1st resistance: 0.6752
Supporting reasons: Identified as an overlap resistance that aligns close to a 61.8% Fibonacci retracement level, indicating a significant area that could halt further upward movement.

NZD/USD

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price has made a bearish break through the pivot and could potentially fall lower towards the 1st support.

Pivot: 0.6037
Supporting reasons: Previously identified as an overlap support which now has been broken due to the strong bearish momentum. The presence of a bearish Ichimoku cloud adds further significance to the bearish momentum.

1st support: 0.6006
Supporting reasons: Identified as a pullback support that aligns with a 100% Fibonacci projection level, suggesting a significant area that could halt further downward momentum.

1st resistance: 0.6092
Supporting reasons: Identified as a pullback resistance, indicating a significant area that could halt further upward movement.

US30 (DJIA):

Potential Direction: Bearish

Overall Momentum of the Chart: Bearish

Price has made a bearish break through the pivot and could potentially fall lower towards the 1st support.

Pivot: 40,922.42
Supporting reasons: Previously identified as a pullback support which now has been broken due to the strong bearish momentum.

1st Support: 40,075.11

Supporting Reasons: Identified as an overlap support that aligns with a 38.2% Fibonacci retracement level, suggesting a significant area where price could find strong support.

1st Resistance: 41,378.74

Supporting Reasons: Identified as a pullback resistance that aligns with the all-time high, indicating a significant area that could halt further upward movement.

DE40 (DAX):

Potential Direction: Bullish

Overall Momentum of the Chart: Bearish

Price could fall towards the pivot and potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 18,227.20
Supporting reasons: Identified as a pullback support, indicating a potential area where buying interests could pick up to stage a minor rebound.

1st Support: 18,064.40

Supporting Reasons: Identified as a multi-swing-low support that aligns with a 127.2% Fibonacci extension, indicating a significant area where price could find strong support.

1st Resistance: 18,499.40

Supporting Reasons: Identified as an overlap resistance that aligns with a 38.2% Fibonacci retracement level, indicating a significant area that could halt further upward movement.

US500 (S&P 500): 

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price has made a bullish bounce off the pivot and could potentially rise towards the 1st resistance.

Pivot: 5,520.06
Supporting reasons: Identified as an overlap support that aligns with a 38.2% Fibonacci retracement level, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 5,448.66

Supporting reasons: Identified as an overlap support that aligns close to a 61.8% Fibonacci retracement level, indicating a potential area where price could find strong support. 

1st resistance: 5,605.03

Supporting reasons: Identified as a pullback resistance that aligns close to a 61.8% Fibonacci retracement level, suggesting a critical area that could halt further upward movement.

BTC/USD (Bitcoin):

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price is falling towards the pivot and could potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 62,395.17

Supporting reasons: Identified as an overlap support that aligns close to a 23.6% Fibonacci retracement level, indicating a potential area where buying interests could pick up to stage a rebound. The presence of a bullish Ichimoku cloud adds further significance to the bullish momentum.

1st support: 59,267.78

Supporting reasons: Identified as an overlap support that aligns close to a 50% Fibonacci retracement level, indicating a significant area that could halt further downward movement.

1st resistance: 66,971.73

Supporting reasons: Identified as a pullback resistance that aligns with a 127.2% Fibonacci extension level, indicating a potential barrier that could halt further upward movement.

ETH/USD (Ethereum):

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price is falling towards the pivot and could potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 3,533.10

Supporting reasons: Identified as an overlap support that aligns with a 23.6% Fibonacci retracement level, indicating a potential area where buying interests could pick up to stage a rebound. The presence of a bullish Ichimoku cloud adds further significance to the bullish momentum.

1st Support: 3,258.56

Supporting Reasons: Identified as an overlap support that aligns with a 38.2% Fibonacci retracement level, indicating a significant area that could halt further downward movement.

1st Resistance: 3,533.10

Supporting Reasons: Identified as a pullback resistance that aligns with a 61.8% Fibonacci retracement level, indicating a historical barrier where selling pressures could intensify.

WTI/USD (Oil):

Potential Direction: Bullish

Overall Momentum of the Chart: Neutral

Price is falling towards the pivot and could potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 80.68

Supporting Reasons: Identified as an overlap support that aligns with a confluence of Fibonacci levels i.e. the 38.2% retracement and the 100% projection, indicating a potential area where buying interests could pick up to stage a rebound.

1st Support: 77.78

Supporting Reasons: Identified as a pullback support that aligns close to a 61.8% Fibonacci retracement level, indicating a significant area where price could find strong support.

1st Resistance: 83.77

Supporting Reasons: Identified as a multi-swing-high resistance, indicating a potential barrier that could halt further upward movement.

XAU/USD (GOLD):

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish bounce off pivot and head towards 1st resistance.

Pivot: 2392.25
Supporting reasons: Identified as an overlap support level, specifically at the 50% Fibonacci Retracement, indicating a potential area where buyers could enter the market after a retracement.

1st support: 2352.95
Supporting reasons: Identified as an overlap support level, suggesting a significant area where previous declines have found support.

1st resistance: 2449.62
Supporting reasons: Identified as a pullback resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.

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The post Friday 19th July 2024: Technical Outlook and Review first appeared on IC Markets | Official Blog.

Japan finance minister Suzuki:

• Also will attend G7 meetings to be held on the sidelines of g20
  meetings
• Plan to discuss
  various topics including world economy and currency at g20
• Hope that
  politicians should be mindful about commenting on market-related
  comments due to their impact

It looks like Suzuki is responding to Kono earlier:

• Japan government minister Kono says he is not directly requesting the BOJ raise rates now

This article was written by Eamonn Sheridan at www.forexlive.com.

China’s Senior Party Official For Policy Research:

• Promoting Chinese-style modernisation faces many complex
  contradictions and problems, but it is necessary

China’s senior party official for deepening reform:

• We have consolidated and developed the advantages of the socialist
  system with Chinese characteristics
• We will continue to
  improve and develop the socialist system
• We will inject
  strong impetus into economic development
• We will continue to
  reform the socialist market economy
• We will improve the
  modern market system and promote market-orientated reform of factors
  of production
• We will deepen
  reform of state-owned enterprises
• Will encourage the
  development and expansion of private economy
• Will build systems
  and mechanisms to support comprehensive innovation
• Will deepen reform
  of the fiscal, taxation and financial systems
• Improve the systems
  and mechanisms for integrating urban and rural development
• Will build a new
  system of an open economy at a higher level
• The functions of
  party and state institutions adapted to the new situation and have
  been continuously improved
• We will promote
  income distribution
• Promote the
  establishment of the world’s largest education, social security,
  medical and healthcare systems
• Will win the largest
  battle in history against poverty
• Will improve the
  centralised, unified, efficient and authoritative national security
  leadership system
• Will continue to
  improve the party’s leadership system and improve the supervision of
  the party and the state
• Will establish and
  improve a comprehensive approach to tackling corruption
• By 2035 the
  country’s governance system and governance capacity will be basically
  modernised

China’s senior party official for economic affairs:

• Should promote state-owned capital and enterprises to become
  stronger, better and bigger, enhance their core functions and
  competitiveness
• On the other hand,
  should create a good environment, opportunities for private
  enterprises
• Improve the
  long-term participation of private enterprises in major national
  projects
• Should formulate and
  promulgate law on promoting private economy
• Should greatly
  increase total factory productivity
• Propose to improve
  the financial relationship between the central and local governments
• Increase local
  independent financial resources and expand local tax sources

***

Plenty to consider in the above. Its all encouraging but until details emerge, which won’t be until a few months time I suspect, its hard to get too excited. Government authorities, it doesn’t matter which country, tend to paint a rosy picture.

This article was written by Eamonn Sheridan at www.forexlive.com.

more to come

Japan’s government cut growth
forecast for
the current fiscal year ending in March 2025
to a 0.9% expansion
from a 1.3% gain projected in January

• expects the economy to grow 1.2% in fiscal
  2025
• consumption took a hit from
  rising import costs
  due to a weak yen
• projected
  growth to accelerate next year on robust
  capital expenditure
  and consumption
• retaining its view the
  economy will sustain
  a domestic demand-led recovery
• Some members of
  the government’s top economic council,
  however, voiced
  concern over recent weakness in consumption and
  the pain the yen’s
  falls were inflicting on households.
  “We can’t
  overlook the impact a weak yen and rising prices
  are having on
  households’ purchasing power,” the private-sector
  members of the
  council told Friday’s meeting that discussed the
  new growth
  forecasts.
• “The government and the Bank of Japan must guide policy with
  a close eye on
  recent yen declines”

This article was written by Eamonn Sheridan at www.forexlive.com.

Chinese Communist Party Third Plenum has concluded.

The news conference with some details, I don’t expect too many, is due at 10am Beijing time

• 0200 GMT
• 2200 US Eastern time

The property sector has been a huge, and prolonged, drag on the economy. More support measures are likely.

This article was written by Eamonn Sheridan at www.forexlive.com.

AP reporting.

No more details.

The gossip mill keeps on churning.

This article was written by Eamonn Sheridan at www.forexlive.com.

The US dollar has popped. But gold has dropped.

Correlation is not necessarily causation. There is no other fresh news about.

The reports are not on mainstream media, only social sources for now.

Added:

• Initial reports suggest a car bomb
• in the Ben Yehuda area of Tel Aviv
• near several embassies and diplomatic sites including the US consulate
• eEmergency services are on the scene

This article was written by Eamonn Sheridan at www.forexlive.com.

BNP Paribas says its remaining bearish on EUR”

• ‘prior to the French parliamentary election being called we held a bearish view on the EUR’
• says that the outcome of the French election reinforces the case for EURUSD to drop ‘towards our year-end target of 1.06’
• see 1.10 in 2025

This article was written by Eamonn Sheridan at www.forexlive.com.