- June 27, 2018
- Posted by: Joey Benedid
- Category: Market News
The Dollar Index has been under pressure as heightened trade tensions continue to weigh on the market. Earlier in the week, Trump had indicated that he was planning to prevent Chinese investment in US tech which in part has contributed to the slide in Chinese Indices. Trump has since changed his tone stating that he may be taking a less confrontational approach against China, and any measures taken would not be exclusive to China. The Senate is beginning to consider options that could limit the President’s authority to execute unilateral tariffs on national security grounds. Oil has rebounded, now trading at $71.23/barrel as a result of an agreed upon increase in production. While oil is trading higher, concerns are growing as large national buyers are considering adhering to Trump’s demands to stop buying from Iran. EUR is soft after gaining slightly on a weaker Dollar. Sterling is also weaker against USD as the BoE has applied pressure to the EU to help solve the issue of international derivatives contracts and how they’re serviced after Brexit.
US Advanced Goods (-$64.8B vs -$69.0B) US Durable Goods (-0.6% vs -1.0%) came out at 8:30am, beating expectations for both. Poloz will be speaking this afternoon, where analysts are expecting that the BoC steer will have an opportunity to steer markets ahead of their July meeting with a 25bp hike currently priced into the markets at 50%. Tomorrow we will see EUR German CPI and US GDP, while German Employment numbers, Eurozone CPI and CAN GDP will be released on Friday. Short term support and resistance is 1.3260 and 1.3385 respectively, while RSI is at 66 and the 200-day moving average resides at 1.2737.