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Weekly Analysis: Economic Data in Focus as Hurricane Harvey Rips Through Texas

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A deluge of economic data this week will make its way through the financial markets, culminating in a high-profile U.S. jobs report on Friday.

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Asian markets were off to a rocky start on Monday as investors assessed the catastrophic impact of Hurricane Harvey.

Hurricane Harvey Rocks Texas

Hurricane Harvey has caused “unprecedented” flooding in the Houston, Texas area that is “beyond anything experienced,” according to local officials. At least three people have been killed after the Cat-4 hurricane made landfall on Friday, where it was downgraded to a tropical storm.

Meteorologists are forecasting the historic rainfall to continue through Wednesday.

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The massive storm has halted about one-quarter of oil production in the Gulf of Mexico and 10% of U.S. refining capacity. The economic impact of the storm could reach $24 billion when factoring the relentless flooding and destruction of major infrastructure. That pales in comparison to Hurricane Katrina, which in 2005 caused $160 billion in damages.

In commodities, gasoline futures on the New York Mercantile Exchange spiked 6% in Singapore. West Texas Intermediate (WTI) crude futures were down slightly in midday trade.

Meanwhile, Asian equities fluctuated and U.S. stock futures fell as investors weighed the damage.

In currencies, the U.S. dollar index (DXY) fell to more than two-year lows on Monday. The greenback suffered a large decline following Janet Yellen’s Jackson Hole speech on Friday.

Economic Calendar

The economic calendar features several high-profile events this week. Below is a rundown of the major market-moving events over the next five days.

Monday

  • U.S. Dallas Fed Manufacturing Business Index (Aug)

Tuesday

  • Japan employment (July) and household spending (July)
  • Germany GfK Consumer Confidence Survey (Sept)
  • U.S. S&P/Case-Shiller Home Price Indices (June)

Wednesday

  • U.K. Inflation Report Hearings
  • Germany preliminary Consumer Price Index (Aug)
  • U.S. ADP Employment Change (Aug) and revised Q2 GDP

Thursday

  • China official Manufacturing and Non-Manufacturing PMI (Aug)
  • Germany Retail Sales (July) and Unemployment (Aug)
  • Eurozone preliminary Unemployment (July) and Consumer Price Index (Aug)
  • U.S. Personal Income and Outlays (July)
  • Canada Q2 GDP

Friday

  • Eurozone Composite PMI (Aug)
  • Germany Composite PMI (Aug)
  • U.K. Manufacturing PMI (Aug)
  • U.S. Nonfarm Payrolls (Aug) and ISM Manufacturing PMI (Aug)

Other Key Events

In addition to economic data, other key events this week include the U.S. Treasury’s issuance of $132 billion in notes and bills on Monday. Meanwhile, the United Kingdom is set to resume Brexit talks with the European Union. Talks officially began in June after the U.K.’s snap parliamentary election.

On the geopolitical front, U.S. Secretary of State Rex Tillerson said on Sunday that Washington will continue to push for negotiations with North Korea to deescalate nuclear tensions in the region. Pyongyang fired three ballistic missiles over the weekend.

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1 Comment

  1. s5peeran

    August 28, 2017 at 7:59 am

    Great calendar and analysis. Could you also include which tradable instruments are affected by the corresponding market moving events?

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Analysis

Technical Analysis: Litecoin and NEO Jump as Bitcoin Trades near $8000

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The cryptocurrency segment continued its bullish run, as the total value of the coins climbed above $230 billion for the first time ever, while Bitcoin also posted marginal new highs. The most valuable currency is still overbought regarding the long-term picture, and we continue to expect a deeper correction in the coming period, despite the recent strong rally. Support levels are still found $7700, $7000, and $6700 while the $8000 level is ahead as a major obstacle.

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BTC/USD, 4-Hour Chart Analysis

Litecoin has been the most active major besides Bitcoin, as it rallied strongly after breaking out above the key $64 resistance and it breached the next target at $75 before heading below $70 again. The coin remains in bullish long- and short-term patterns, and we expect a move above the major resistance zone ahead with the next target found at $82.50.

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Litecoin/USD, 4-Hour Chart Analysis

NEO is showing strength in the second half of the session, while Monero is recovering well from a short-term dip, similarly to IOTA and Ethereum Classic. Ethereum continues to represent stability in the segment, while Ripple failed to build up momentum so far after yesterdays spike higher. With still most of the altcoins being in bullish setups, let’s see the short-term charts.

(more…)

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Analysis

XRP Looking to Make a Significant Rally

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The XRP/USD pair went into a deep correction after hitting 0.29490 a month ago. It nosedived to the major support level of 0.19052. The pair consolidated for a few weeks which gave the market the legs to test resistance at 0.22924.

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Technical indicators show that the pair was ready to breach its immediate resistance, which it did this morning. Now that resistance has broke at 0.22924, it’s time to buy. This successful breakout will take the pair to 0.23997 first and 0.26563 next before hitting the target of 0.26796 which is coincidentally a major resistance level.

Technical indicators hint that the market would most likely be overbought by the time it hits 0.26796. Should it respect the major resistance level, the likelihood of the market turning extremely bearish increases. Therefore, it is recommended to closely watch your trail stops to preserve your gains.  

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Summary of Strategy

Buy: As close to 0.22924

Support: 0.22224 and 0.20081

Target: 0.26796

Stop: If the market breaches 0.20081 as next reliable support is 0.19052

 

Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

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Analysis

Technical Analysis: Ripple Breaks Out as Bitcoin Tests Highs

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Cryptocurrencies are having another bullish session as the total value of the market surged to a new all-time high near $225 billion, with the help of the rally in BTC and Ripple, and despite the drop in the value of Bitcoin Cash. The most valuable coin its record high yet again after the brief but steep weekend correction, despite the still overbought long-term picture. We still urge traders and investors to wait for a deeper correction before entering new positions here, with support levels found at $7000, $6700, and $6000.

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BTC/USD, 4-Hour Chart Analysis

Ripple has been the other main mover of the day so far, as the coin skyrocketed on huge volume and breached the $0.26 level before turning lower and stabilizing near $0.23. The coin triggered a short-term buy signal by moving above $0.2250 and it remains bullish on both time-frames, despite the pull-back, with another major target level ahead at $0.30.

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Ripple/USD, 4-Hour Chart Analysis

The other majors are little changed expect IOTA, which further added to yesterday’s gains and reached overbought readings, while Ethereum Classic and Dash continue to drift lower in short-term correction patterns. Let’s see the detailed analysis of the short-term charts.

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