The price of crude oil soared in the Asian session after the US and China reached a deal to suspend trade hostilities. In a meeting between President Xi and Trump, the two leaders agreed to halt hostilities and work on developing a trade deal beneficial for the two countries. Trump agreed not to raise tariffs to 25% on Chinese goods while China agreed to increase purchases of American goods. Traders will continue paying close attention to the upcoming meeting of OPEC ministers in Vienna.
The Australian dollar rose today after the agreement between the United States and China. This is despite the relatively weaker economic data from Australia. Building approvals for October contracted by 1.5%, which was worse than the expected decline of 1.4%. In September, the approvals had increased by 5.5%. Moreover, company gross operating profits increased by 1.9% for the third quarter, which was lower than the consensus estimate of 2.9%. Business inventories were unchanged. The consensus estimate was a growth of 0.4%. On a positive note, the construction work done in the third quarter jumped by 2.7%.
The Caixin manufacturing PMI showed that activity in China’s manufacturing industry rose to 50.2 in November. This was lower than the consensus estimate of 50.0. Last week, the PMI data from Markit showed that activity had slowed down to 50. Later today, traders will receive the manufacturing PMI data from France, Germany, Brazil, and the United States.
XTI/USD
On Thursday and Friday, the XTI/USD pair traded in a narrow range between 49 and 50. This came as traders waited for the G20 meeting. Today, the price jumped to 53.9. This was the highest level in more than a week and a likely sign that the downward pressure is over. The rally could accelerate ahead and after the OPEC meeting in Vienna. On the four-hour chart, the 15-day EMA is crossing the 30-day EMA in a bullish way. The RSI has moved from 35 and is currently at 60 while the MACD is moving above the neutral level. It is likely therefore that the new upward trend will continue.
EUR/USD
The EUR/USD pair moved up slightly today after the G20 meeting. Going forward, the pair will likely be affected by the PMI data from Europe and the US. The pair is still trading within a range as shown in the 8-hour chart below. The current price is along the 30-day and 15-day EMA while the RSI is at a neutral place. The same is true with the momentum indicator, which is at the 100 level. This is an indication that the pair could breakout in either direction.
AUD/USD
The Australian dollar rose sharply in the Asian session today. The pair reached an intraday high of 0.7380, which is the highest level since August this year. It was a continuation of a rally that started in October. The pair’s price is above the 15-day and 30-day EMA while the RSI has jumped to almost 70. The MACD too has moved above the neutral line. Therefore, it is likely that the upward rally will continue
