Today’s Key Market Drivers: 20th July 2018
“Trump says Powell is a great guy.”
Donald Trump on Thursday took the opportunity to lash out at the US Federal Reserve saying he was unimpressed with the US Fed raising interest rates and he was also not happy about the rising US Dollar. In fairness to Trump, he did say he would leave the Fed alone to make their own decisions (gee thanks Don) and in typical Trump style once he’d finished shit bagging the Fed said Chairman Jerome Powell was a “very good man”. The US Dollar retreated a little through the US trading session, however, traders don’t seriously think Trump’s comments are going to have any long lasting negative impact on the greenback and its steady climb higher against most of its rivals is likely going to continue in the short to medium term.
The Aussie Dollar jumped higher at 11.30am AEST on Thursday following better than expected job numbers. The market was anticipating Australia had job creation of around 16,000 jobs in June but that number was substantially higher at 50,000, however, it failed to move the unemployment rate lower from the current 5.4%. The unemployment rate isn’t the problem for Australia, its low wages growth that the RBA wants to see reverse and head back higher and they are unlikely going to move on the official interest rate until wages growth picks up. This is one reason why I continue to hold the view the AUD will gradually move lower into the 0.60’s against the US Dollar.
The Aussie, Euro, Pound and Kiwi Dollars fell sharply against the US Dollar at the start of the European trading session as the UK missed estimates on June Retail Sales and traders continued to view being long the US Dollar as the trade of the week. The selling pressure over those 2 to 3 hours was heavy and I believe this price action is a sign of further selling to come. Today I am looking to add to my overall short positions on the AUD with a price rejection trade to the downside on the AUD v JPY from the daily chart. A Trade Time Alert will be sent once the trade is triggered.
Please join me at 2.00pm AEST in the FX trading room for Friday Live as I walk you through how to view the wave formations across all the currency pairs to ensure you are giving yourself every opportunity to be on the right side of the market and entering a trend. Matching up the wave formation with a price rejection or head and shoulders formation will certainly assist your decision making and results over time. Wave formations and learning to see them will be today’s focus in Friday Live.
There is little in the way of high impacting economic news today other than Japanese and Canadian CPI data. The Japanese data wont’ move financial markets however the Canadian CPI will likely impact the CAD by up to half a cent if out of line with expectations. I expect Asian stock indexes to be weak today following a weak lead from the US and if markets across Asia do sell off then the AUD and NZD will likely move back lower once again.
You will see below and, in the video, I have added some more content to the Bullish and Bearish indicator selections now giving reference to the daily chart where I think it needs to be referenced.
Any trade updates throughout the day will be sent via Trade Time. You can also follow my daily updates on Facebook, Twitter, Instagram by searching for TrainwithAndrew. Make sure you subscribe to the Andrew Barnett YouTube channel after watching today’s Sunrise video below.
About the Author: Andrew Barnett
Andrew is a professional trader and successful investor who has a strong focus on education. He is a regular Sky News Money Channel Guest and one of Australia’s most awarded and respected financial experts and is regularly contacted by the Australian Media for the latest on what is happening with the Australian Dollar. Director at LTG GoldRock, Andrew Barnett, guides thousands of traders around the world in the live market on a daily basis, advising them on buy and sell directions, as well as trading his own personal account. Andrew, a regular keynote speaker at trading and wealth-creation events throughout the Asia Pacific region, is an authorized representative registered with the Australian Securities and Investment Commission (ASIC).
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