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Oil producers and traders have remained in a rather inactive position in the latest days. This could be due to weakness in worldwide demand for the commodity weighing in on the market. In general, the oil market price activity has not been what market participants expected in the latest sessions despite Iran's tensions and OPEC production cuts. Financial institutions and traders have removed any bullish trades as U.S. production was uplifted. On the contrary, fundamental news of the market could be at its peak for 2019. The latest developments, indicate various Chinese oil companies are still purchasing Iranian oil. The oil is being stored in tankers at Chinese ports and remains unused. However, the US has proceeded to sanction a Chinese firm claimed to violating restrictions on Iranian Oil. According to the above-mentioned topics, oil prices could pick up strong movement unexpectedly and caution is advised.

USD moves higher as Trump and US congress reach deal

On Monday, US congress leaders agreed to a two-year extension of the debt limit and federal spending caps. Under the deal, spending could increase to $1.37 trillion in the fiscal year starting Oct. 1, compared to $1.32 trillion this year. Even though the budget is forecasted to increase as the year’s progress, the deal is positive for the US as it displays unity and even common goal orientation. Disagreements on the budget have been hurtful for the US economy in the past and so this could now be avoided as the deal passes to legislation. Furthermore from the US, a meeting took place in the White House that consisted of President Donald Trump and technology companies including Google and Intel. The meeting was to make decisions on their further business interaction with Huawei Technologies Co Ltd. In order for the firms to continue to sell chips to the Chinese firm they will need to obtain special licenses. It not completely clear on how the US firms will proceed with the matter yet the White House announced that there was unanimous support for national security restrictions on U.S. telecom equipment purchases and sales to Huawei. On the other hand, Washington Post put pressure on the US government when it made claims that Huawei secretly helped North Korea to build wireless network. However, if the matter is cleared the USD and the companies involved could get some support as US and China have been seemingly on good terms lately.

WTI 4 Hour

Support: 56.00 (S1), 54.45 (S2), 53.00 (S3)
Resistance: 57.70 (R1), 59.50 (R2), 61.00 (R3)

USD Index Daily

Support: 96.91 (S1), 96.50 (S2), 96.10 (S3)
Resistance: 97.27 (R1), 97.50 (R2), 97.80 (R3)

The common European currency traded sideways movement against the Japanese Yen on Monday. The 100-hour simple moving average provided resistance at 121.08 during yesterday's trading session.

Most likely, the EUR/JPY exchange rate might continue its downward swing within this session. Bearish traders are likely to aim at the lower boundary of a descending channel pattern at 120.52.

Furthermore, technical indicators suggest that the currency exchange rate could edge lower during the following trading session.

The Australian Dollar continued its movement in a junior descending channel pattern against the US Dollar on Monday. The currency pair declined by 0.44% in value during the previous trading session.

Given that the exchange rate has breached both the 50-, 100– and 200-hour SMAs, a breakout through the lower boundary of the descending channel pattern could occur within this session.

If the breakout occurs, a decline towards a support level formed by the weekly S1 at 0.7000 could be expected today.

During the past 24 hours of trading, the US Dollar has depreciated about 0.74% in value against the Canadian Dollar. The currency pair reached a two-week high at 1.3148 during the Asian session on Tuesday.

As for the near future, the exchange rate could make a brief retracement towards a support level formed by the 50-hour simple moving average at 1.3081 within this session.

However, the weekly resistance level at 1.3108 could act as a support level during the coming trading hours.

The New Zealand Dollar has depreciated about 56 base points against the US Dollar since July 22. A breakout had occurred through the bottom border of an ascending channel pattern.

Currently, the exchange rate is near a support level formed by the 200-hour simple moving average at 0.6725.

If the support level holds, a surge towards the 0.6780 regions could be expected within this session.

However, if the currency exchange rate passes the 200-hour SMA, the next target for bearish traders will be at the weekly S1 at 0.6705.

Ethereum is started to move back towards the $210.00 support level after the cryptocurrency found strong resistance from just above the $225.00 level. ETHUSD bears may start to test back towards the currently trading low, although failure to break the low will likely encourage ETHUSD bulls to step in. Overall, the trading action in Bitcoin is still having a strong correlation to ETHUSD moves.

If the ETHUSD pair trades below the $225.00 level, key support is found at the $200.00 and $187.00 levels.

If the ETHUSD pair trades above the $225.00 level, key resistance is found at the $235.00 and $250.00 levels.

The euro currency continues to trade on the back foot against the US dollar as pair fails to attract buying interest ahead of Thursday’s ECB meeting. Technical indicators across the lower and higher time frames remain oversold, although a bounce in the EURUSD pair is not forthcoming. The 1.1230 resistance level is the main area short-term bulls need to break for another attempt a the 1.1248 level.

The EURUSD pair is only bearish while trading below the 1.1230 level, key support is found at the 1.1190 and 1.1175 levels.

If the EURUSD pair trades above the 1.1230 level, bulls could test back towards the 1.1248 and 1.1280 levels.

The British pound remains in the doldrums against the US dollar on Tuesday as the pair continues to meet fresh waves of selling around the 1.2500 resistance area. The GBPUSD pair could fall sharply if the 1.2440 support level is broken over the coming sessions. To the upside, bulls need to move price above the 1.2660 level to change the negative technical bias towards the pair.

The GBPUSD pair is only bullish while trading above the 1.2510 level, key resistance is located at the 1.2530 and 1.2560 levels.

If the GBPUSD pair holds below the 1.2510 level, key support is found at the 1.2440 and 1.2410 levels.

Yesterday, US stocks moved slightly higher as investors waited for key corporate earnings. This week, hundreds of companies in the S&P 500 index are set to release their earnings. This includes companies like Google, Boeing, Starbucks and Caterpillar among others. Companies have already started releasing key information. Overnight, it was released that Apple was in advanced talks to buy Intel’s smartphone modem chip business in a deal that could be valued at more than $1 billion. In another acquisition, Starbucks announced that it had bought a stake in Brightloom, a tech company that specializes in mobile ordering and payments.

The British pound declined in overnight trading a day before Boris Johnson becomes the new Prime Minister. Boris, the former Mayor of London has said that he will be ready to take the UK out of the European Union even without a deal. According to the Bank of England and other organizations, leaving without a deal would have a significant hit to the country’s GDP in the short and medium term. This is because of the huge business disruption that would happen. However, in a bid to avert this, Parliament passed a bill to prevent Boris from leading the UK out of the EU without a deal.

Later today, the market will receive the existing home sales from the United States. Analysts expect the existing home sales data for June to be 5.35 million. This will be slightly higher than May’s 5.34 million. On a MoM basis, home sales are expected to decline by -0.2%, which will be worse than the previous growth of 2.5%. The house price index for May is expected to decline slightly to 0.3% from the previous 0.4%. The Richmond manufacturing index for July is expected to increase to 5 from the previous 3.

SPX500

The S&P 500 index increased to a high of $2993 as investors expected earnings from most companies in the index. This was an increase from the day’s low of $2968. On the hourly chart, this price is along the higher line of the Bollinger Bands while the RSI has moved from the previous oversold low of 30 to the current 60. The pair will likely continue moving higher to test the important resistance level of $3000.

EUR/USD

On Friday, the EUR/USD pair rose to an important support of 1.1280 and then started to move lower. The pair continued the decline and reached a low of 1.1195. On the hourly chart, the pair is trading below the 28-day and 14-day moving averages. The pair’s RSI has moved close to the oversold level of 30 while the average directional index has climbed to a high of 48. The pair will likely remain in a holding pattern along these 1.1200 levels ahead of the ECB decision on Thursday.

AUD/USD

The AUD/USD pair declined to a low of 0.7020 in the Australian session. This was a continuation to the declines that started on Friday last week. On the hourly chart below, the pair is trading below the 14-day and 28-day moving averages. The RSI has moved closer to the oversold level of 30 while the ADX has moved to above 50. The pair could continue moving lower to the 61.8% Fibonacci Retracement level of 0.7015.

According to the monthly economic report by Japan's Cabinet Office, the economy is "recovering at a moderate pace," but there was "weakness continuing mainly in exports." Asia bound exports were particularly poor due to China's slowdown and weaker demand for high-tech products. .

Nevertheless, the reference to weakness in "industrial production" in the June report was dropped. Instead, production of "transport goods continued to increase, while the decline in machinery production could be seen easing a little,"

Businesses show "cautiousness further" but investment is still "on the increase at a moderate pace". Also, employment situation is "improving steadily" while private consumption is "picking up".