Daily Report on September 29, 2016
Asian shares rallied on Thursday, taking their cue from the Wall Street overnight that finished higher after OPEC members reached an agreement on a production-limiting deal. The Dow Jones rose 0.61 percent, to 18,339.24, the S&P 500 gained 0.53 percent, to 2,171.37 and the Nasdaq Composite added 0.24 percent, to 5,318.55.
Stocks were boosted by surging oil prices following an unexpectedly decision by major oil producers to cut crude production for the first time since 2008. Crude production will possibly be curbed by about 750,000 barrels per day. The details over country-by-country production is to be decided at the next formal OPEC meeting in November.
The news came after the U.S. Department of Energy’s Energy Information Administration’s data showed that U.S. crude stocks lost 1.9 million barrels to 502.7 million barrels in the week to Sept. 23. Inventories had been expected to rebound after the big drop in previous weeks. However, the EIA continued to surprise the market by reporting unexpected supply declines for four weeks in a row.
Elsewhere, data from the Ministry of Economy, Trade and Industry on Thursday indicated that Japan’s retail sales fell more than expected in August. Japanese retail sales retreated by 2.1 percent in August from a year earlier, due to a stronger Yen and slow wage growth that discouraged spending on clothes and home appliances. The figures have shown worse results than forecast for the sixth straight month, casting pressure on policymakers to find ways of beefing up household spending.
Having falling more than 220 pips from the peak in the last six months, USDCAD bounced back as bear has exhausted after sending market into oversold state. Since the start of September, the pair had been in an uptrend, forming higher highs and higher lows, combined with turning the resistance at 1.31400 into a firm support. USD, however, fell back under this level yesterday and is expected to extend the downfall to the 23.6% retracement at 1.29857.
Buy Digital Put Option from 1.30500 to 1.30000 valid 20:00 GMT September 29, 2016
USD has breached the near-term resistance at 101.200 versus the JPY. The pair also moved past the 50-period moving average at 101.050, confirming the uptrend after it broke above the MA20. However, the upside seems limited as the downtrend line that has connected lower highs is within the sight.
Buy Digital Put Option from 101.950 to 101.200 valid until 20:00 GMT September 29, 2016
The Norwegian Krone has escaped from the range between 8.09000 and 8.15000, and hit nearly five-month highs at around 8.01771. However, the pair is being held around this level as it has fallen into another consolidation period. As can be seen from the RSI indicator chart, USDNOK is trading in the oversold territory. That helps explain current corrective moves. The pair is expected to extend the slide then.
Buy Digital Put Option from 8.01770 to 7.96900 valid until 20:00 GMT September 29, 2016
Brent has been retreating from the highest level in three weeks at 49.07. The price reversed lower as a result of profit-taking after the market had been overblown and entered the overbought zone. Furthermore, the downward trendline connecting lower lows since August 19 also acted as a firm resistance. Nonetheless, this handle is much likely to be broken through as MAs and parabolic sar band placed below the action are supporting upbeat moves.
Buy Digital Call Option from 48.20 to 49.35 valid until 20:00 GMT September 29, 2016
Wheat futures contract resumed the rally today, following a retreat on Wednesday. The price action has been twisted with the moving averages, showing a period of sideways generally. As the short-term MA has converged with the long-term MA, and the RSI index is pointing upwards from 50 threshold, the commodity may re-attempt one week high at 410.10.
Buy Digital Call Option from 407.00 to 410.00 valid until 20:00 GMT September 29, 2016
German’ DAX 30 index has been paring all of its losses in the last one week and heading upwards to two-week highs around 10700.00 recorded last Thursday. From near oversold zone, the DAX market has entered bullish territory with RSI surpassing the 50 line. Besides, ADX index that has soared to 26.36, coupled with the wide gap between the +DI and –DI lines, consolidated prolonged rally.
Buy Digital Call Option from 10600.00 to 10700.00 valid until 20:00 GMT September 29, 2016