Everest Fortune Group | Daily Analysis: 7 May 2019
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Daily Analysis: 7 May 2019

Daily Analysis: 7 May 2019

JPY

 

Fundamental Analysis

(7 May):There was a bounce in risk as Trump’s Tweet which was taken as a pinch of salt in U.S. markets, underpinned by the updates posted by the South China Morning Post reporters that China is still preparing to send a delegation to Washington and Liu He was part of the delegation. However, the market tends to read it as a negotiation tactic even after Robert Lighthizer accusing Beijing of “reneging” on commitments it made in earlier talks and reiterated that the US would increase its tariffs on $200 billion. JPY could edge lower with RBA keeping the rate unchanged, where growing risk appetite keeps a lid on JPY.

 

 

(6 May):Pound rallied on Friday following the substantial defeat suffered by the Conservative and Labour party in the local elections, which triggered expectations that the government will hasten efforts to secure a cross-party Brexit deal over coming days. Using vote tallies to project how a General Election might play out, Labour and Conservative party would each command 28% of national vote, lower than 30% showing a rejection of 2 of the largest parties. Comments from Labour Party Leader Jeremy Corbyn caused the surge in the currency as he indicated that local elections should spur lawmakers in the House Of Common to find a way to get Brexit deal done and put an end to the uncertainty. Now that Brexit is more certain to go through, market are pricing in rate hikes that BOE has been hinting to come should Brexit goes smoothly.

 

 

 

Technical Analysis

JPY

Fundamental Analysis

(7 May): There was a bounce in risk as Trump’s Tweet which was taken as a pinch of salt in U.S. markets, underpinned by the updates posted by the South China Morning Post reporters that China is still preparing to send a delegation to Washington and Liu He was part of the delegation. However, the market tends to read it as a negotiation tactic even after Robert Lighthizer accusing Beijing of “reneging” on commitments it made in earlier talks and reiterated that the US would increase its tariffs on $200 billion. 

(6 May): U.S. employment numbers were mixed. Wage growth edged up to 0.2%, shy of the estimate of 0.3%. However, nonfarm payrolls sparkled, climbing to 263 thousand, up from 196 thousand a month earlier. The reading easily beat the forecast of 181 thousand… 

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