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Varchev Finance: Trading day in one post – 14.06.2018

Asian Stock Market – Expected Asian markets reflected interest rate hike and change in Fed’s plans negative. In Japan, the Nikkei 225 declined 0.53%, mainly due to the losses of mining companies. Kospi collapsed by 1.59%, mainly due to the automotive and technology sector. ASX200 is down with -0.14%, Shanghai composite with -0.28% and Hang Seng with -0.62%.

FX Market – I’ll start with the only loser, AUD. The currency fell by -0.20% due to strong sales in the mining sector, and as we flag the Australian economy is directly dependent on the mining industry across Asia. Safe Havens, JPY and CHF are expected to see a boost for the Fed and the expected ECB meeting today to decide the fate of QE. I expect the JPY and CHF growth to remain moderate in trade today as investors will seek shelter before the announcement of the ECB’s intentions. CAD rose by 0.07% due to oil growth. If the price of oil continues to rise, I expect CAD to gain better positions on the FX market.

Commodity Market – Rising oil prices have also raised the question of the strength of demand, and the response is in stark contrast to rising prices. If, until two years ago, electric cars were the taboo theme for much of the world, today the restructuring not only of the automotive sector, but even of the shipping and aviation industry are the agenda. In short, demand will not rise. The risks to oil remain a rise in the US dollar, as well as temporary conflicts in the Middle East. Gold still remains lethargic at prices around $ 1,300. To reduce the price here is hard to talk, but a collapse in the stock markets would help the precious metal.

European stock market – Today’s top event for all traders and investors is the ECB press conference at 3:30 pm. A little earlier, at 14:45, the central bank will decide on the basic interest rate, but that is not important. The probability of raising interest rates is negligible and it is almost certain that the ECB will not go up. Investors will look forward to Mario Draghi’s press conference at 15:30, where they will expect him to hear the end date of quantitative facilities – QE. If this, as everyone expects, becomes a reality, the strong growth in the euro will be inevitable. Regarding the moods before the start of the European stock market, they are negative. Futures of European indices point to a negative start. DAX30 will open 10 points lower, CAC40 with 5 points and UKX with 16. I expect the weak volatility to dominate the markets until 14:45, then to normalize until 15:30 when it is possible to observe very sharp movements in the cross with the euro brought about by Mario Draghi’s statement.

US Stock Market – Wall Street indices collapsed after the Federal Reserve’s decision to raise the bank’s interest rates and plans for two more increases by the end of 2018. The Dow fell by nearly 120 points, with the Walt Disney performing best with 1.85%, and worse shares of Verizon and Caterpillar, which fell by 2.78% and 1.63%, respectively. S & P 500 declined by 0.36% and Nasdaq registered -0.11%. During the US session today, I expect investors to accumulate the moods created by Mario Draghi’s statement.

Economic Calendar for European and US trade Sessions – June 14, 2018

11:30 UK – Retail Sales

14:45 Eurozone – ECB Interest Rate decision

15:30 Eurozone – ECB Press conference

15:30 USA – Retail Sales


 Trader Petar Milanov


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