Forex Market Overview (Aug 7th – Aug 11th)

Last week witnessed a negative affair for global major markets with almost all indexes making losses.

Heading into last week in Europe, the DAX finished up at 12014, dropping by 2.2%. The FTSE was down about 2.88% to end the session at 7310. The CAC was also down by 2.9% on last week’s close at 5060.9.

In the US, The Nasdaq composite index lost around 1.5% and the Dow also dropped by 1.1% to end up at 21858 over the course of the week.

Switching to Japan, the Nikkei 225 ended the week down by 1.6%, trading at 19730.

Currency markets


Moving to currency markets, last week saw Euro prices slightly gain or lose against one major currency (except EUR/NZD ended up by +1.72%) due to a quite economic calendar, while US dollar was tumbling amid the influence of speculation about Federal Reserve monetary policy and geopolitical risk rising between North Korea and the United States. The Euro found itself stronger versus the Greenback last week by 0.47% to finish up at 1.18180 to the US Dollar.

The British Pound is getting more and more signs trading like a risk-on currency such as the Australian and the New Zealand Dollar instead of haven currency like the Japanese Yen or the Swiss Franc. This might be due to lots of risk from recent and upcoming significant UK data releases (Brexit obviously is the leading reason). The Sterling weakened against the US Dollar by 0.36%, trading at 1.2990 at the end of the week.

The Japanese Yen, however, had a positive week strengthening against most of its counterparts as risk aversion started to show across world’s financial markets regarding the rising geopolitical tensions between the US and North Korea. USD/JPY fell by 1.5% during the week, closing at 109.12.

USD/CAD’s rally seems to get more and more overextended, hinting a possible reversal in short-term. Last week, the Canadian Dollar weakened versus the Greenback by 0.26%, closing at 1.26764. However, we must note that Bank of Canada may adopt a more hawkish tone in the near future due to recent positive economic data releases, which could lead to a lower dip of the currency pair.

The Australian Dollar had a week facing plenty of verbal intervention from its central bank when Governor Philip Lowe kept mentioning that a weaker Aussie would be more helpful for the economy. AUD/USD finished up the week dropping by 0.45% to end up at 0.78909.

The New Zealand Dollar tended to trade lower as the Reserve Bank of New Zealand (RBNZ) left rates unchanged at 1.75% at Governor Graeme Wheeler’s monetary policy meeting on Thursday last week. The Kiwi-Greenback was down by 1.38% during the week, closing at 0.73152.

Commodities market


On the commodities market, crude oil prices was down on last week’s close by 0.61%, trading at $52.1 per barrel. Gold prices rose by 1.3% over the course of the week’s trading, closing at $1286.76.
See also:
Weekly trading forecast November 19 - 23
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