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Britain’s Gove says door not closed on EU deal talks By Reuters

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© Reuters. Britain’s Chancellor of the Duchy of Lancaster Michael Gove arrives for a Cabinet meeting, in London

LONDON (Reuters) – British senior minister Michael Gove said on Sunday the door remained “ajar” for talks on a post-Brexit trade deal to continue if the European Union changed its approach.

“I think the EU effectively ended the current round of talks last week. It was the case we were making progress but then the EU retreated from that,” he told BBC TV.

Asked if the door was ajar for talks to continue, Gove said: “It is ajar. We hope that the EU will change their position; we’re certainly not saying if they do change their position that we can’t talk to them.”

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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Dollar Down, U.S.-China Tensions Rise By Investing.com

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© Reuters.

By Gina Lee

Investing.com – The dollar was down on Tuesday morning, giving up earlier gains. Tensions between the U.S. and China are rising and concerns, and continuing worries over the second wave of COVID-19 drove the steepest stocks selloff in a month and a bond rally

The , which tracks the greenback against a basket of other currencies, edged down 0.11% to 92.942 by 10:31 AM ET (2:31 AM GMT).

On the COVID-19 front, the U.S., Russia and France all set new records for the number of daily COVID-19 cases. There are over 43.4 million cases globally as of Oct. 27, according to Johns Hopkins University data.

Some investors were wary of the dollar’s prospects ahead of the Nov. 3 U.S. presidential election.

“The dollar is broadly stronger, but not massively,” with structural forces such as low real yields holding back further gains adding to the wait-and-see approach to the election, National Australia Bank (OTC:) senior FX strategist Rodrigo Catril told Reuters.

“I think many would probably remember the bad experiences we had going into the Trump-Clinton election [in 2016] … if you had a position on [the election], you would have been whipsawed big time. I think the strategy this time is to travel light, and to choose the opportunity on the day rather than take on a very, very strong position going into the election,” Catril added.

With a week remaining, although polls are giving Democrat candidate Joe Biden a solid lead over President Donald Trump, both men were engaging in some last-minute campaigning in battleground states where the race is tighter.

Some investors view a Biden victory, especially if combined with a Democrat Senate, as negative for the greenback as the Democrats are expected to introduce stimulus measures with big price tags to combat COVID-19, which is expected to improve investor sentiment and boost riskier currencies.

Investors are already starting to bet on a Biden victory, with positioning data showing long bets on the safe-haven yen shrinking for a fourth consecutive week. But a fall in short bets against the yen pointed to increased uncertainty about the election’s outcome.

The pair inched down 0.10% to 104.71.

The pair edged down 0.12% to 6.7038. U.S.-China tensions mounted over a potential $2.4 billion sale of U.S. anti-ship missiles to Taiwan, potentially encompassing as many as 100 Harpoon Coastal Defense Systems built by Boeing (NYSE:). The systems in turn include up to 400 land-based missiles China reacted to the news by slapping sanctions on U.S. companies, including Lockheed Martin (NYSE:), Boeing Defense and Raytheon (NYSE:) “in order to uphold national interests,” Chinese Foreign Ministry spokesman Zhao Lijian said on Monday. Meanwhile, the Chinese Communist Party will set the nation’s next five-year plan within the week.

The pair edged up 0.17% to 0.7134 and the pair edged up 0.1% to 0.6690. The pair inched up 0.10% to 1.3037.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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GBP, AUD, USD Volatility to Swell on Cross-Continental Geopolitical Risks?

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2020 Election, Brexit, China Plenum, Japan Prime Minister Speech, WTO Tariff Rewards, GBP, AUD, EUR – Talking Points

  • British Pound braces for Brexit as political volatility rattles GBP crosses
  • Australian Dollar traders closely eyeing Chinese Plenum and 5-year plan
  • Euro, US Dollar price action may pick up on upcoming WTO tariff ruling

Brexit and the Pound

Implied volatility in the British Pound may rise throughout the week as EU and UK policymakers buckle down to finally hammer out a Brexit deal before mid-November. While the initial timeline was set for a month earlier, friction over fisheries has remained a key sticking point. Amid the delays, UK Prime Minister Boris Johnson has warned that businesses should start to prepare for a no-deal outcome.

The issue over fisheries from the UK perspective stands on the same ideological pillars that underwrote the Brexit movement: notions of reclaiming of sovereignty – hence the phrase “take back control”. In this light, it is perhaps not surprising that this issue is so sensitive, and this is amplified by the economically-strategic value it adds to whomever holds the rights over it.

On Friday, France reportedly said it was preparing to compromise on this issue which it had previously taken a hard stance against. This comes as UK Trade Secretary Liz Truss said that both the EU and UK are “making good progress on the negotiations”. Positive developments like these could push the British Pound higher, though given the volatility of the situation, a hiccup in talks could easily reverse those gains.

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EUR/GBP Analysis

EUR/GBP price action towards the end of last week is indicative of how domestic political volatility in the UK can derail what appeared to be a clear technical pattern. The pair was being guided lower by steep, descending resistance before breaking out on October 20, aggressively retreating the following day, and two days later blasting through it again.

EUR/GBP – Daily Chart

Chart showing EUR/GBP

EUR/GBP chart created using TradingView

Looking ahead, if the downtrend is indeed invalidated, the next area EUR/GBP will likely have to clear is a shelf at 0.9190. Clearing that layer could open the door to the March swing-high at 0.9258. Having said that, capitulation at 0.9190 could indicate a lack of underlying confidence in the pair’s short-term outlook. It is likely that its retreat would coincide with a lack of progress in Brexit negotiations.

Japan’s New Prime Minister Gives First Policy Speech

This week, the new Japanese Prime Minister Yoshihide Suga who replaced Shinzo Abe, will be making his first policy speech in the role. This event under normal circumstances would be something noteworthy to watch, but the importance of it is now amplified by virtue of the coronavirus pandemic. One main topic will be climate change with a focus on cutting Japan’s greenhouse gas emissions to net zero by 2050.

In terms of stimulus, Nikkei news reported that the new PM may attempt to introduce and implement stimulus as early as November. The country has already introduced a $2.2 trillion fiscal stimulus bill, many provisions reflecting similar measures taken by other states like loans to small businesses and cash payments. A robust and generous plan could push local equities higher but pressure the anti-risk Japanese Yen.

Follow me on Twitter @ZabelinDimitri for more updates on how politics impacts financial markets.

China Plenum Begins – Why Does it Matter?

China’s Communist Party will be meeting from October 26-29 in Beijing to discuss and plan for the installment of the 14th 5-year plan for the period of 2021-2025. With mounting tension between China and the West – particularly the US – the Asian giant may start to focus on its so-called dual circulation policy. This entails strengthening its domestic economic vitality and shifting away from foreign independence.

Beijing has been facing growing pressure as a result of its policies in the South China Sea, Hong Kong and controversy in the Xinjiang region that has drawn international scrutiny and condemnation. This shift inward is also amplified by comments like President Donald Trump who talked about decoupling from China as tensions between the two grow amid trade war uncertainty and the novel Covid-19 pandemic.

This policy shift accelerated following the Trump administration’s efforts to curtail China’s importation and use of US-based chipmaking technologies. As I wrote in another piece: “Washington has even gone so far as to ban all chip suppliers from selling their goods to Asian tech giants like Huawei if the hardware being sold uses American equipmentThis has pushed Beijing to start rapidly developing its own chipmaking industry.

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Looking ahead, greater separation of China from the world would likely mean a proverbial musical chairs of supply chains as each one attempts to optimally position themselves in a constantly-shifting global order. The main takeaway is the uncertainty of the situation and the impact it may have on China and neighbors that rely on its economic performance – like Australia.

WTO to Grant EU Tariff Rewards

The World Trade Organization (WTO) is expected to formally award the European Union the right to impose $4 billion in retaliatory tariffs against the US’s subsidies to aeronautical giant Boeing. The EU intends to notify the Dispute Settlement Body (DSB) of its intent to exercise its right to these tariffs at the next meeting on October 26. This is comes in response to the US using tariffs against the EU for their subsidies to Airbus.

The White House has warned that it will hit back if the bloc imposes these tariffs, particularly since it comes during a politically-delicate time in an election where Mr. Trump is lagging in the polls. Escalation in this area could compound risk aversion caused by delayed fiscal stimulus talks, potentially setting EUR/USD up for a pullback.

EUR/USD Outlook

EUR/USD may retest the multi-year swing-high range between 1.1936 and 1.1965 in the coming week. If resistance is cleared, it could market the start of a trend-defining change. If the underlying narrative shifts adequately enough, bullish sentiment may swell and amplify the pair’s gains following its ascent in June and subsequent period of congestion and decline.

EUR/USD – Daily Chart

GBP, AUD, USD Volatility to Swell on Cross-Continental Geopolitical Risks?

EUR/USD chart created using TradingView

— Written by Dimitri Zabelin, Currency Analyst for DailyFX.com

To contact Dimitri, use the comments section below or@ZabelinDimitrion Twitter





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The Nasdaq 100 is Poised for a Volatile Week as Key Earnings Arrive

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Nasdaq 100 Price Outlook:

  • The Nasdaq 100 experienced a volatile start to the week, piercing technical support around 11,600
  • Earnings are expected from more than 35% of the companies listed on the S&P 500
  • Key names include Apple, Amazon, Facebook, Google and Microsoft

The Nasdaq 100 is Poised for a Volatile Week as Key Earnings Arrive

The Nasdaq 100 endured a volatile start to the week as soaring covid cases and vanishing hopes of stimulus in the United States worked to undermine risk appetite. In the world of earnings, an abysmal quarter and outlook for Germany’s largest software company, SAP, delivered a sobering report on the technology sector ahead of what is arguably one of the most important periods this year for the Nasdaq 100. To that end, upcoming earnings from the big-tech giants could create significant volatility in the tech-heavy index right ahead of the US Presidential election.

nasdaq 100 price chart

Source: Bloomberg, Refinitiv, Justin McQueen

With that in mind, all of the newly released information, coupled with high expectations and the immense uncertainty around the election, could create the perfect cocktail for serious volatility at a time when the VIX is already elevated. Thus, the environment for predicting directional moves is far from perfect and strategies that capitalize on volatility may be well suited for the current landscape.

nasdaq 100 price chart

Source: Bloomberg, Refinitiv, Justin McQueen

Either way, the Nasdaq is likely to be in the driver’s seat in the week ahead, making the technical levels at play on the chart all the more important. After breaking beneath support at 11,600 on Monday, the next spot at risk appears to be the Fibonacci level around 11,360 which already rejected one attempt lower. Beyond that, subsequent support might reside around 11,200.

Nasdaq 100 Price Chart: 4 – Hour Time Frame (August 2020 – October 2020)

nasdaq 100 price chart

On the other hand, 11,600 may now serve as resistance going forward while secondary levels might reside at 11,782 and 12,044 respectively. As these high profile earnings are released to the market, investors will gain a clearer picture of what to expect on the horizon. Until then, it might be difficult for the Nasdaq to establish a clear-cut trend. In the meantime, follow @PeterHanksFX on Twitter for updates and analysis.

–Written by Peter Hanks, Strategist for DailyFX.com

Contact and follow Peter on Twitter @PeterHanksFX





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