Phillip Futures
Friday, May 17, 2019 If you cannot read this newsletter, click here
 
 
 
Foreign Exchange

The US dollar was bullish against all of its major pairs on Thursday. On the economic data front, housing starts jumped by 5.7% YoY to 1.235M in April (estimated 1.209M) from 1.168M in March while building permits improved by 0.6% MoM to 1.296M in April (expected 1.289M) compared to 1.288M a month earlier. Initial jobless claims decreased to 212k in week ended May 11th (forecasted 220k) from 228k a week earlier while continuing claims decreased to 1.66M in week ended May 4th (estimated 1.673M) compared to 1.688M in the prior week. Finally, the Bloomberg consumer comfort index slightly improved to 59.9 in week ended May 12th vs. 59.8 a week earlier.

The Euro was mixed against its major pairs. The euro zone trade balance excess narrowed to E17.9B in March (E19.4B expected) from E20.6B a month earlier.

The Australian dollar was lower against all of its major pairs.
 
Gold spot Intraday: under pressure.
Pivot: 1291.50

Our preference: short positions below 1291.50 with targets at 1281.75 & 1279.00 in extension.

Alternative scenario: above 1291.50 look for further upside with 1295.25 & 1298.50 as targets.

Comment: the RSI is bearish and calls for further downside.

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Green Lines Represent Resistances | Red Lines Represent Support Levels | Light Blue is a Pivot Point |  Black represents the price when the report was produced

 
EUR/USD Intraday: the downside prevails.
Pivot: 1.1190

Our preference: short positions below 1.1190 with targets at 1.1155 & 1.1140 in extension.

Alternative scenario: above 1.1190 look for further upside with 1.1205 & 1.1225 as targets.

Comment: the break below 1.1190 is a negative signal that has opened a path to 1.1155.

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Green Lines Represent Resistances | Red Lines Represent Support Levels | Light Blue is a Pivot Point |  Black represents the price when the report was produced

 
GBP/USD Intraday: watch 1.2745.
Pivot: 1.2820

Our preference: short positions below 1.2820 with targets at 1.2770 & 1.2745 in extension.

Alternative scenario: above 1.2820 look for further upside with 1.2850 & 1.2880 as targets.

Comment: technically the RSI is below its neutrality area at 50.

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Green Lines Represent Resistances | Red Lines Represent Support Levels | Light Blue is a Pivot Point |  Black represents the price when the report was produced

 
USD/JPY Intraday: further advance.
Pivot: 109.60

Our preference: long positions above 109.60 with targets at 110.05 & 110.30 in extension.

Alternative scenario: below 109.60 look for further downside with 109.35 & 109.15 as targets.

Comment: the RSI lacks downward momentum.

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Green Lines Represent Resistances | Red Lines Represent Support Levels | Light Blue is a Pivot Point |  Black represents the price when the report was produced

 
AUD/USD Intraday: target 0.6865.
Pivot: 0.6905

Our preference: short positions below 0.6905 with targets at 0.6880 & 0.6865 in extension.

Alternative scenario: above 0.6905 look for further upside with 0.6920 & 0.6935 as targets.

Comment: a break below 0.6880 would trigger a drop towards 0.6865.

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Green Lines Represent Resistances | Red Lines Represent Support Levels | Light Blue is a Pivot Point |  Black represents the price when the report was produced

 
USD/CAD Intraday: look for 1.3505.
Pivot: 1.3440

Our preference: long positions above 1.3440 with targets at 1.3485 & 1.3505 in extension.

Alternative scenario: below 1.3440 look for further downside with 1.3415 & 1.3400 as targets.

Comment: the RSI is bullish and calls for further upside.

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Green Lines Represent Resistances | Red Lines Represent Support Levels | Light Blue is a Pivot Point |  Black represents the price when the report was produced

 
USD/SGD Intraday: further advance.
Pivot: 1.3700

Our preference: long positions above 1.3700 with targets at 1.3750 & 1.3770 in extension.

Alternative scenario: below 1.3700 look for further downside with 1.3675 & 1.3660 as targets.

Comment: the RSI is bullish and calls for further advance.

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Green Lines Represent Resistances | Red Lines Represent Support Levels | Light Blue is a Pivot Point |  Black represents the price when the report was produced

 
 
MA (50) & MA (20): The most simple trend indicators are Moving Averages. They simply correspond to an average calculated on an evolving time scale (20 and 50 periods): every day, the oldest value (often taken at the close) in the average calculus is replaced by the value of the new session.

Bollinger bands: are represented by 3 different bands and are derived from moving averages. The middle band corresponds to a simple moving average (MA (20)). The level of the upper band, in every point, corresponds to the sum of the level of the middle band and twice the value of the standard deviation associated to the 20-day moving average. Reciprocally, the level of the lower band corresponds to the level of the middle band diminished by twice the value of the standard deviation associated to the 20-day moving average. An envelop of the stock price is thus determined. This makes it possible to then identify the variation margin in which the stock should stay almost systematically. In the case of a stock following a Gauss law, 95 % of the trades will thus occur between these bands.

RSI (14): the Relative Strength Index aims at establishing a reference scale independently from the stock prices levels themselves. As the RSI has boundaries (0 and 100), it then becomes very easy to determine overbought (above 70) and oversold (below 30) areas. In addition, just as on prices themselves, supports and resistances can appear, especially when nearing the neutrality zone (near 50). Thus, the RSI is one of the most commonly used counter-trend indicators.
It is based on the average of rises and drops of price, with the formula:
RSI = 100 - [100 / (1 + RS)]
Where RS represents the average of up closes divided by the average of down closes on the considered period (14).
 
 
 
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