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  • Will the Reserve bank of Australia weaken the AUD?

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    The Reserve bank of Australia will make its statement and announce the official rate on June 4, at 7:30 MT time.

    Analysts anticipate the RBA to cut its interest rate from 1.5% to 1.25%. The chances of a rate cut are high as the Australian economy keeps weakening. The slowdown of the GDP growth, falling house prices and the rise of unemployment are among the key reasons behind the anticipated decision by the RBA. Despite the high chances of the rate cut, the central bank may keep its interest rate unchanged. If it happens, the Australian dollar may get positive momentum.

    • If the RBA keeps its interest rate unchanged, the Australian dollar will rise;

    • If the RBA cut its interest rate, the Australian dollar will fall.


    • Grandfather of crypto falls below the $8,000 level after consolidation

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      Bears finally took over the cryptomarket and pulled the price for BTC down. At the moment, it is testing the support at $7,970. If this level is broken, bears will face with the next key level at $7,660. If bulls take over, they will need to push the price for Bitcoin above the $8,500 level to the next resistance at $8,800.


      • The volatility for the USD is expected

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        The level of non-farm payrolls, also known as non-farm employment change or NFP will be out on June 7, at 15:30 MT time.

        The indicator represents the change in the number of employed people during the previous month without farmers. Traders pay huge attention to it, as it makes the US dollar highly volatile after the release. Also, we recommend you not to underestimate the unemployment rate and the level of average hourly earnings. These indicators are released at the same time as the non-farm payrolls and they tend to affect the USD as well. Last time, the NFP outperformed the forecasts. It advanced by 263 thousand jobs (vs. 181 thousand expected). However, bulls could not hold their positions due to the lower-than-expected average hourly earnings (0.2% vs. 0.3%). This time the employment data may lead to a different outcome.

        • If NFP is higher than the expectations, the USD will rise;

        • If NFP is lower than the expectations, the USD will fall.


        • The euro has risen above the 100-day MA on the comments by Mario Draghi

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          During today's press conference, the ECB president said that the data was "somewhat" better than the expectations in the first quarter. The euro jumped higher on his comments, targeting the next resistance at 1.1321. If his further comments are more dovish, EUR/USD will fall back below the 1.1253 level to the support at 1.1214.


          • Another chance for the USD

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            The level of retail sales and core retail sales will be out on June 14, at 15:30 MT time.

            The indicator of retail sales represents the change in the total value of sales at the retail level. Its core level excludes the sales of autos due to their high volatility. Last time both of the indicators came out lower than the forecasts. The level of retail sales declined to 0.2% (vs. the anticipated increase to 0.2%), while its core level advanced only by 0.1% (vs. the forecast of 0.7%). If this time the situation changes, the USD will rise.

            • If the actual levels of indicators are higher than the expectations, the USD will rise;

            • If the actual levels of indicators are lower than the expectations, the USD will fall.


            • Market updates on June 11

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              On Tuesday, the improved market sentiment supported risky assets such as stocks, emerging-market currencies, and crude oil.

              Oil benchmarks have been trying to recover on the improved market sentiment. Talks that OPEC and its allies would continue its program of oil output cuts supported the oil market. However, the effect was limited. WTI moved up but with small gains. Up to now, the oil benchmark has been trading near 53.60. The resistance is located at 54.48. However, the downward pressure is high. If the benchmark is not able to break above 54.48. We will see a decline to 51.70. Brent rose less than WTI. The benchmark reached a high at 62.86. However, bears were stronger and Brent moved down. The support is located at 60.60.

              The Chinese yuan succeeds to appreciate against the USD. On Friday, USD/CNH reached the highest level of the year at 6.9613. However, the improved sentiment encouraged Chinese currency. Up to now, the pair has been trading near 6.9242 moving to the support at 6.9165. A close below this level will lead to the further appreciation of the CNH. The next level to touch is 6.90. In the case of risk aversion, USD/CNH will turn around and will move towards 6.9470 targeting the top near 6.9614.

              The Mexican peso keeps gaining strength against the US dollar. USD/MXN has been moving down for the 3 days in a row. If bears manage to pull the pair below 50-day simple MA at 19.08, we will see a further decline to 19.02. If the pair rebounds, we may anticipate a rise towards 19.24. The next resistance is at 19.3120.


              • Risk management


                Risk management is the key element of Forex trading. It’s better to understand this simple fact rather sooner than later and put a lot of efforts into mastering this science. By definition, risk management is the identification, analysis, assessment, control, and avoidance, minimization, or elimination of unacceptable risks. The risk that exists for Forex traders is simple to understand: it’s the ever-present risk of a bad trade that is closed with a loss.



                • MARKET UPDATES

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                  The Australian dollar weakened because of the bigger-than-expected unemployment rate figure. On H4, AUD/USD has been targeting the first support at 0.69. A close below this level will provoke a further decline to 0.6870 with a test of 0.6887. RSI and Stochastic Oscillators are in the oversold area, the rise of the pair will be confirmed as soon as RSI crosses the 30 level bottom up and Stochastic oscillator crosses the signal line. In the case of the rebound, the important resistance is located at 0.6933.

                  The Swiss franc rose on the Swiss National Bank statement. Although, the central bank kept the interest rate on hold and didn’t provide any hints on a soon increase, comments about the possible weakness of the euro and the USD supported the Swiss currency. As a result, USD/CHF fell. On H4, the pair reached the support at 0.9921 (50-period MA) but rebounded. The first resistance is located at 0.9956, a break above this level will signal a continuation of the upward movement. However, the resistance is strong and we may see a re-test of 0.9921. A break below this level will lift risks of the decline to 0.9888.

                  Brent has risen significantly after news about oil tankers being attacked in the Gulf of Oman. Up to now, the oil benchmark has been moving to the first resistance at 63.73 with a test of 63.


                  • Heads up to the FOMC statement

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                    The Federal Open Market Committee will make its statement and announce the official rate on June 19, at 21:00 MT time.

                    Despite the demands by US President Donald Trump to cut the interest rate, no changes to it are expected. Now, policymakers keep the interest rate at 2.5%. However, we may find out the hints on the possibility of a rate cut later this year. Wednesday’s statement will show how the US-China trade war and recent weaker economic data affect the Fed decisions.

                    • If the Fed is hawkish, the USD will go up;

                    • If the Fed is dovish, the USD will go down.


                    • The new stimulus for the euro? Mario Draghi sent EUR/USD lower on the dovish

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                      During today’s speech, the ECB President Mario Draghi made remarks on using a rate cut as a primary tool for an economic stimulus.
                      On the H4, EUR/USD fell to the support at 1.1179 during the European trading hours. At the moment, the pair is correcting to the upside. The first resistance is placed at 1.1211. If the positive momentum is short-lived, the pair will break the 1.1179 level and try to test the support at 1.1165.


                      • Market updates on June 19



                        Key events ahead:

                        British CPI – 11:30 MT time

                        Forecast: 2%

                        Canadian CPI – 15:30 MT time

                        Forecast: +0.1%

                        Speech by the ECB president Mario Draghi – 17:00 MT time

                        FOMC statement – 21:00 MT time

                        After the plunge of the euro on the dovish comments by the ECB President, EUR/USD has been consolidating near the support at 1.1187 on the H4. If bears manage to break this level, the next support levels will lie at 1.1173 and 1.1165. Bulls need to push the pair higher to the resistance at 1.1209 to confirm their strength. The next resistance will lie at 1.1221. Traders will focus their attention to the fresh comments by the ECB president later today and to the FOMC meeting at 21:00 MT.

                        US President Donald Trump had a telephone conversation with Chinese President Xi yesterday. The leaders agreed to meet during the G20 Summit in Japan. The news increased the risk appetite in the market. The risk-on sentiment pushed the oil prices and the Canadian dollar up.

                        The price for WTI retested the $54.28 level on the news. On the daily chart, from the upside, the next resistance levels are placed at $55.71 and $57.60. Bears need to push the pair back to the support at $50.78 to confirm their strength. The next key level lies at $48.47.

                        Brent, in its turn, retested the upper border of the consolidation range at $62.66. The next resistance is placed at $63.6. In the case of the fall, we need to keep an eye on the lower border of the consolidation at $57.6. The next support is at $57.5.

                        On the H4, USD/CAD bounced from the 200-period SMA at 1.3427 and plunged below the 100-period SMA. The pair has tested the lows below the 1.3373 level. If bears continue to drive the loonie down, the next support will lie at 1.3357. On the other hand, pay attention to the resistance at 1.3409. The next level for bulls will lie at 1.3419. Next, the CPI release and the FOMC meeting will likely determine the direction for the pair.