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Forex Daily Recap – Chinese Q2 GDP Slump Left Global Investors Unnerved

By:
Nikhil Khandelwal
Published: Jul 15, 2019, 17:38 UTC

Today, the GBP/USD pair maintained a strong downtrend amid rising Brexit uncertainities. Meanwhile, Lower-than-expected June Producer and Import Prices provided the extra ammunition to the resilient USD/CHY bulls.

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USD/CNY

After opening near 6.8764 level on Monday, the USD/CNY pair continued to move within the 15-day old symmetrical triangle. The lines of this symmetrical triangle have almost reached the last point just before an intersection. The central theme for the day was the disappointing Chinese Q2 GDP reports.  The Q2 YoY GDP figures came around 6.2% this time over the previous 6.4%. Meantime, the Q2 MoM GDP reports that remained 0.2% higher than the last data caught less market attention.

USDCNY 60 Min 15 July 2019
USDCNY 60 Min 15 July 2019

Rest of the events in the economic docket stood well above the street hopes. The June YoY Retail Sales, over which, the market had a bearish stance, reported well above the consensus estimates. Notably, the Retail Sales came around 1.5% above the market hopes around 8.3%. Also, the June YoY Industrial Production showcased a whopping 1.3% rise than the previous 5.0%. Strong 6.8776 resistance remained as the main barrier disallowing the bulls from exiting the symmetrical triangle trap.

USD/CHF

During the initial hours, a 3-day old descending slanting resistance was restricting the USD/CHF pair’s upside.  However, in the middle of the day, the USD/CHF bulls geared up and breached the aforementioned resistance. The breakout happened took place 0.9835 level. Anyhow, the further upward movements of the pair got capped by 0.9852 support-turned-resistance.

USDCHF 60 Min 15 July 2019
USDCHF 60 Min 15 July 2019

Quite noticeably, the RSI shoot up from 27 mark, straight to 52.66 mark. Such an impulsive growth in this technical indicator revealed the immediate demand rise among the buyers. Today, Lower-than-expected June Producer and Import Prices had provided the extra ammunition to the resilient USD/CHY bulls. The MoM Producer and Import Prices reported -0.5% over 0.0% forecasts. Also, the YoY data came around -1.4% over -0.9% market expectation.

GBP/USD

After displaying some splendid performance last day, the Cable gave up all the accumulated gains today. Over the last few sessions, the GBP/USD pair appeared to keep the volatility intact within 1.2510/77 range level. Meantime, there was a simultaneous drop in the Relative Strength Index (RSI) technical indicator, reaching near 30.42 level. Such a strong pessimism got developed around the Pound pair on the backdrop of the rising Brexit uncertainties.

GBPUSD 60 Min 15 July 2019
GBPUSD 60 Min 15 July 2019

UK’s next PM would take charge of the office on July 24. Both the top Tory leadership contenders, Boris Johnson, and Jeremy Hunt, have already provided their hard Brexit stance. On that front, British Finance Minister Philip Hammond proclaimed that he would do everything he could to stop a no-deal Brexit.

AUD/USD

The Aussie pair kept the uptrend intact on Monday respecting the 5-day old ascending slanting support line. Robust SMA conflux on the downside acted as a firm cushion bestowing pair’s positive upliftment. China and Australia are good trading partners. Hence, Chinese economic growth is quite vital for Australia. Today, the Chinese Q2 GDP data recorded lower than the previous figures, reporting near 6.2%. Anyhow, the AUD/USD pair seemed to shrug over this adverse significant economic data.

AUDUSD 60 Min 15 July 2019
AUDUSD 60 Min 15 July 2019

However, the pair remained mostly within the 0.7027/0.7036 range level throughout the day. Also, today, the US economic docket lacked significant economic events. Nevertheless, the July NY Empire State Manufacturing Index reported well above the consensus estimates. The actual reports came around 4.3 points over 2.0 points expectations.

About the Author

Nik has extensive experience as an Analyst, Trader and Financial Consultant for Global Capital Markets. His vision is to generate Highest, Consistent and Sustained Risk-Adjusted Returns for clients over long term basis and providing them world-class investment advisory services.

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