Analytics, News, and Forecasts for CFD Markets: currency news — 24-09-2018.

Wholesale sales rose for the third time in five months, up 1.5% to $63.9 billion in July, more than offsetting the 0.9% decline in June. Sales were up in four of seven subsectors, representing approximately 66% of total wholesale sales.

The personal and household goods; food, beverage and tobacco; and motor vehicle and parts subsectors led the gains in July, while the miscellaneous subsector posted the largest decline.

In volume terms, wholesale sales increased 1.2%.

The personal and household goods subsector rose for the second consecutive month, up 4.2% to $9.2 billion in July. Sales were up in five of six industries, led by the textile, clothing and footwear, and personal goods industries. In volume terms, sales in the subsector increased 4.6%.

The single currency remained higher against the greenback on Monday as traders bought the euro after somewhat positive German IFO surveys, which came out above market estimates. The EURUSD pair was trading 0.20% higher around 1.1770, heading into the US session.

The IFO expectations index dipped from 101.2 to 101.0 in September, but analysts had expected only 100.2. Moreover, the current assessment gauge stayed at 106.4 (also above the market' estimate) and the business climate subindex slowed a notch to 103.7. The euro was bid afterward.

Later in the day, the ECB President Mario Draghi is due to testify about the economy and monetary policy before the European Parliament Economic and Monetary Affairs Committee in Brussels. This event could cause another volatility on the single currency.

Sentiment remains kind of neutral on Monday as China called off planned trade talks with the U.S., saying they won't negotiate new trade deals under the threat of new tariffs, which are now effective, starting this week. Chinese imports worth of 200 billion USD will be levied by a 10% tax till the end of the year and by a 25% tax since 2019.

Stocks dropped broadly after the news China is withdrawing from the negotiation table, but losses were minimal, with EU indices trading marginally lower and US futures were seen 0.20% weaker shortly before the opening bell.

US yields continued their march higher and both the 10-year and 30-year are trading near cycle highs, with the first around 3.08% and the later at 3.215%. However, the US dollar failed to find any support from rising yields, but stock markets might get spooked if this bullish momentum persists further.

Disclaimer:

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The survey, of 409 firms, revealed that output growth slowed in the three months to September, but remained above the long-term average.

Output expanded in 10 out of 17 sub-sectors, with growth driven predominantly by the mechanical engineering, food, drink & tobacco, plastic products, and metal products sectors. Manufacturers expect output growth to pick up over the next three months.

Meanwhile, total order books weakened slightly again but remained well above the long-run average. Export order books also faded a little to their weakest in almost a year, but likewise remained well above the long run average.

Expectations for output price inflation remained firmly above the long-run average, while stocks of finished goods remained adequate but below the long-run average.

Firms' assessments of their current business situation deteriorated marginally, but remain at a high level. Companies also scaled back their business expectations somewhat. Despite growing uncertainty, the German economy remains robust.

In manufacturing, the index fell. This was due to far poorer assessments of the current business situation, which nevertheless remain way above their long-term average. Business expectations, by contrast, climbed to their highest level since February. Manufacturers plan to ramp up production in the months ahead.

In the services sector, the business climate remained almost unchanged. While service providers were more satisfied with their current business situation, they were less optimistic about their six-month business outlook.

A merger between Casino and Carrefour would be a positive for the much lower-rated Casino bonds and a negative for Carrefour's, but any potential combination would probably be hit with antitrust issues, say analysts at ING. "At this stage it's difficult to assess how much truth the talk holds," says ING, after Carrefour denied making any such approach. Casino shares trade down 0.5% at EUR35.86, Carrefour trades up 0.3% at EUR16.64 - via WSJ

• Comcast's $38.8 billion offer, euivalent to 1,728 pence ($22.60) a share, easily trumped Fox's highest bid of 1,567p after three rounds of bidding Saturday

• Producers Have Enough Capacity to Meet Unexpected Situations in Market

• Says Kingdom's Output Will Largely Depend on Demand

EUR/USD

Resistance levels (open interest**, contracts)

$1.1878 (2970)

$1.1860 (3106)

$1.1839 (1731)

Price at time of writing this review: $1.1747

Support levels (open interest**, contracts):

$1.1715 (2410)

$1.1678 (1758)

$1.1636 (3992)

Comments:

- Overall open interest on the CALL options and PUT options with the expiration date October, 15 is 90243 contracts (according to data from September, 21) with the maximum number of contracts with strike price $1,1900 (5376);

GBP/USD

Resistance levels (open interest**, contracts)

$1.3266 (2906)

$1.3214 (2448)

$1.3179 (1710)

Price at time of writing this review: $1.3079

Support levels (open interest**, contracts):

$1.2982 (1272)

$1.2948 (2060)

$1.2911 (1690)

Comments:

- Overall open interest on the CALL options with the expiration date October, 15 is 29851 contracts, with the maximum number of contracts with strike price $1,3335 (2981);

- Overall open interest on the PUT options with the expiration date October, 15 is 34095 contracts, with the maximum number of contracts with strike price $1,2800 (2528);

- The ratio of PUT/CALL was 1.14 versus 1.12 from the previous trading day according to data from September, 21.

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.