FX168 Financial News (Hong Kong) News August 14th, 22:30 to August 15th, 06:30, the market summary: the dollar and the yen rose simultaneously during the day, as the economic recession concerns increased the market's safe-haven demand. But as the US economy remains strong relative to other major economies, the dollar remains attractive. At the same time, the offshore renminbi retreated some of the earlier gains on Wednesday, as weaker-than-expected economic data weakened the optimism that the US decided to postpone tariffs.
The Dailyfx author pointed out that although the technical outlook for the dollar is further bullish, it should be seen that the US recession is a signal that the two-year and ten-year bond yields have been upside down for the first time since 2007. At the same time, the market currently expects the Fed to announce another rate cut at the September meeting. Although the US dollar still has an interest rate advantage for major currencies, if it continues to cut interest rates in the future, this weakening of the advantage will be detrimental to the US dollar.
The worries of the inversion of the yield curve, the weak economic data from China and Germany, and the optimism triggered by reports of progress on Sino-US trade negotiations on Tuesday have made the global market worse. Official data released on Wednesday showed that China's industrial added value growth in July fell to the lowest in 17 years. In addition, the decline in exports led to a contraction in the German economy in the second quarter. These have aggravated market anxiety.
Analysis of major currency trends:
EUR/USD: The session opened at 1.1143 during the session and was trading at a low level during the session. From a technical point of view, the MACD red kinetic energy column has shrunk sharply, and the KDJ indicator is close to the midline, indicating that the short-term trend of the exchange rate has turned into bearish. The initial resistance of the exchange rate is at 1.1176, the further resistance is at 1.1213, the key resistance is at 1.1236, the initial support for the downside is at 1.1115, the further support is at 1.1092, and the more critical support is at 1.1055.
GBP/USD: The session opened at 1.2060 during the session and fluctuated within a narrow range. The market traded near 1.2057. From a technical point of view, the MACD green kinetic energy column has shrunk, and the KDJ indicator has gradually moved out of the oversold area, indicating that the downward pressure on the exchange rate has eased slightly. The initial resistance of the exchange rate is at 1.2090, the further resistance is at 1.2123, the more critical resistance is at 1.2146; the initial support for the downside is at 1.2035, further support is at 1.2012, and the more critical support is at 1.1979.
USD/JPY: The session opened at 105.96, which continued the decline during the session and traded near 105.80 in the late session. From a technical point of view, the MACD green kinetic energy column is steadily shrinking, and the KDJ indicator is approaching the mid-line upwards, suggesting that the exchange rate will fade in the near future. The initial resistance of the exchange rate is at 106.56, the further resistance is at 107.22, the more critical resistance is at 107.68; the initial support for the downside is at 105.45, the further support is at 104.99, and the more critical support is at 104.33.