Market Drivers
- Due today - ECB President to speak; US Crude Oil Inventories and US Interest Rate Decision; expectations that the European Central Bank (ECB) and the US Fed will shift towards lower interest rate policies is helping stock markets across the EU and US approach near all-time historic highs;
- Lower Interest Rate Expectations boosting European Stock Markets Higher; overnight Asian stocks sharply higher; Crude Oil Jumps +5.6% last 5 days; major European stock indices all higher last 5 days; Italian MIB gains +2.5%; French CAC40 +2.65%; German DAX +2%; UK FTSE 100 +1.2% all higher last 5 days;
- European Central Bank (ECB) adds fuel to stock markets yesterday saying that lower interest rates remains a "tool" if needed to add more stimulus to keep EU economies moving ahead; this statement along with expectations that the US Fed will shift towards lower interest rate policy is helping stock markets across the EU and US approach near all-time historic highs;
- Crude Oil speculators boost Oil prices higher with WTI (CL) jumping +5.6% higher over the last 5 days on bets of improving outlook between the US-China trade war; Energy prices also finding short term support on expectations that lower US and EU interest rates will help boost global demand for Crude; CL current price $54.08 +5.6% last 5 days; support $50.20; resistance $55.85; due today – US Crude Oil Inventories forecasted to fall -1.077 million barrels;
Charts
Technical Alert: French CAC40 Index testing resistance after European Central Bank (ECB) adds fuel to European stock markets saying the ECB willing to use its “tools” to stimulate the European economies; current price 5512; upside 5751 to 5854, downside support 5206;
Technical Alert: Eurostoxx 50 Index breaks above resistance after European Central Bank (ECB) adds fuel to European stock markets saying the ECB willing to use its “tools” to stimulate the European economies; current price 3457; upside 3519 to 3633, support 3260
German DAX Technical Alert; price breaks above 12,212 resistance further upside remains provided price can call 12,212 a new support level; current price 12,336; upside 12,485 to 12,795 provided price hold above 12,212; support 11,920; Today’s 2nd ECB in two day’s by ECB president could offer further catalyst,
Crude Oil speculators boost Oil prices higher with WTI (CL) jumping +5.6% higher over the last 5 days on bets of improving outlook between the US-China trade war; Energy prices also finding short term support on expectations that lower US and EU interest rates will help boost global demand for Crude; CL current price $54.08 +5.6% last 5 days; support $50.20; resistance $55.85;
Economic Calendar Events (All times GMT+1)
- European Central Bank President Draghi Speaks as President of the European Central Bank starting November 2011; as head of the ECB, which controls short term interest rates, he has more influence over the EUR value than any other person. His comments may determine a short-term positive or negative trend.
- Crude Oil Inventories forecasted to fall -1.077 million barrels; if the increase in crude inventories is more than expected, it implies weaker demand and is bearish for crude prices. The same can be said if a decline in inventories is less than expected. If the increase in crude is less than expected, it implies greater demand and is bullish for crude prices. The same can be said if a decline in inventories is more than expected.
- 19:00 GMT +1 Fed Interest Rate Decision; forecast to remain unchanged at 2.5%; however high price action across USD assets is expected since traders will be looking to here of any clues if the US FED will be making a move to lower interest rates at its next meeting in September; Traders watch interest rate changes closely as short term interest rates are the primary factor in currency valuation. A higher than expected rate is positive/bullish for the USD, while a lower than expected rate is negative/bearish for the USD.
Source: FXGM / Bloomberg