Daily Market News – January 18th, 2016

Daily Market News – January 18th, 2016


Hello and welcome to HiwayFX market news for January 18, 2016. On Friday, the euro closed the day above the key mark of 1.090. The maximum was reached about the level of 1.0931. The European currency got benefits due to very weak economy data from the US. The US Industrial Production plunged 1.8% year-over-year the fastest pace of collapse since May 2008 and a level that has never not produced a recession. Industrial Production dropped 0.4% month-to-month, double the 0.2% drop expected as Capacity Utilization plunged to 76.5%, the lowest since July 2013 as Manufacturing hovers at its weakest growth year-over-year since February 2014. Another thing to worry about US economy. Reuters reports, citing the Bureau of Transportation Statistics. “The total volume of freight moved by road, rail, pipeline, inland waterways and air cargo in November 2015 was 1.1 percent lower than in the corresponding month a year earlier.” On Monday morning, the EUR/USD pair trades below the level of 1.0880 by losing 0.25% as the US dollar remains well bid on the back rising demand for risk currencies in wake of a minor recovery seen in Asian stocks. The economic calendar is empty due to celebration Martin Luther King day in the US. The resistance levels for the bulls are 1.0943 and 1.1017. The support levels for the EUR/USD are following 1.0859 and 1.0832. On Friday, the Mexican peso weakened to a new historic low of 18.3260 pesos per dollar amid plummeting oil prices, even though the central bank sold a total of $400 million in auctions during the morning to support the currency. This morning, we observe a technical correction. The USD/MXN pair slides to the level of 18.22 by losing 0.24%. The resistance levels for the pair are 18.247 and 18.320. The support levels are 18.200 and 18.180. Oil prices hit their lowest since 2003 on Monday, as the market braced for a jump in Iranian exports after the lifting of sanctions against the country over the weekend. US Crude oil continues to trade below the key psychological of 30 dollars per barrel. As ReutReers notes, “the U.N. nuclear watchdog on Saturday said Tehran had met its commitments to curtail its nuclear programme and the United States immediately revoked sanctions that had slashed Iran’s oil exports by around 2 million barrels per day (bpd) since its pre-sanctions 2011 peak to little more than 1 million barrels per day. On Sunday, Iran – a member of the Organiza tion of the Petroleum Exporting Countries (OPEC) said it was ready to increase its exports by 500,000 barrels per day.” Analysts in Barclays Banks said that “Iranian exports come at a very bad time. A chronic global surplus of a million barrels or more of crude daily has pulled down oil prices by over 75 percent since mid-2014 and by over a quarter since the start of 2016.” However, traders and analysts described the plunge in prices as a kneejerk reaction saying Iran’s ambitions to export 500,000 barrels per day were not very realistic. Analysts expect Iran to take time to fully revive its export infrastructure that has suffered from years of underinvestment. Experts say that oil is oversold and a technical correction should happen. The resistance levels for the oil are $30 and $31.50. The support levels are $28.50 and $27.80. On Friday, the key American index S&P500 plunged to the level 1880 by losing over 2%. The American index closed the week with biggest losses since September 2015. The panicked selling was sparked by a nearly 6 percent slide in US-produced crude oil that pushed prices below the critical $30 a barrel mark. Investor anxiety in mainland China compounded global worry with the Shanghai Composite closing at a 3.6 percent loss, hitting a one-year low. The resistance levels for the S&P500 index are 1890 and 1910. The support levels are 1870 and 1850. Stay up-to-date with all the key financial news around the world by liking us on Facebook following us on Twitter and Instagram and subscribing to our YouTube channel. For more information please visit our website www.hiwayfx.com. Thank you and have a good trading day.

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