The Dollar ended the series of losses, as the US Dollar Index (USDX), which measures the performance of the Dollar against six other major currencies closed higher for the first time since last Thursday, and gaining 0.19%.
The Turkish Lira further declined to a two weeks low against the Dollar as markets are not convinced that the Turkish central bank, effectively under president Erdogan’s control, is doing enough in this crisis. Reuters also reported that it might come to a reshuffle in personnel of the leadership of the central bank.
Equity indices closed lower on Thursday, with Asian stock coming under pressure over reports that the US president Trump wants to step up his actions in the trade war with China, while also criticizing the European Union on its trade policies.
Cryptocurrencies traded mixed, with Ripple continuing showing lower performance, while the Bitcoin remained relatively stable around the $7,000 level. Bitcoin continues to outperform many other established cryptocurrencies such as Ethereum, gaining more than 100% against the second largest cryptocurrency by market capitalization since the mid of May.
On Friday in France, Italy and the EU will release their inflation statistics. The EU also releases Unemployment Rate data and Italy follows with Gross Domestic Product (GDP) statistics. Canada releases its Industrial Product and Raw Materials Price Index. In the US Business Barometer and Consumer Sentiment data will be released.
With the recovery of the Dollar, the EUR/USD ended its series of gains and traded overall lower. The ongoing trade conflict from the US could also have pressured the Euro, as the US president said that the European offer to scrap all tariffs was not good enough for him.
The German Unemployment Rate was as expected at 5.2%, while the Consumer Price Index (CPI) was at +0.1% m/m lower than expected (+0.2%). Also the Economic Sentiment as published by the European Commission lagged behind expectations at only 111.6 (expected 112.0).
US data on the other hand was mostly positive with Jobless New claims at 213,000 being marginally below expectations.
On Friday in France, Italy and the EU will release their inflation statistics. The EU also releases Unemployment Rate data and Italy follows with Gross Domestic Product (GDP) statistics.
Pivot:1.1645Support:1.16451.16151.1595Resistance:1.1711.1731.175Scenario 1:long positions above 1.1645 with targets at 1.1710 & 1.1730 in extension.Scenario 2:below 1.1645 look for further downside with 1.1615 & 1.1595 as targets.Comment:the RSI shows upside momentum
While the Rand came under pressure just as many other emerging markets, especially Turkey are also struggling, there were extended losses on Friday morning, while most other emerging markets managed at least a minimal recovery.
Stakeholders remain critical of the countries policies, while the ANC leadership for the time being withdrew the land reform bill, which is seeking to expropriate white farmers without compensation.
Producer Prices for July were reported up by 0.6% m/m, which is above expectations, while Private Sector Credit reduced for the same period.
On Friday South Africa releases its Trade Balance data. Next week other key data, such as Manufacturing PMI and GDP are going to be released.
Pivot:14.625Support:14.62514.48914.407Resistance:14.98615.06815.149Scenario 1:as long as 14.6250 is support look for 14.9860.Scenario 2:below 14.6250, expect 14.4890 and 14.4070.Comment:the RSI is above its neutrality area at 50. The MACD is below its signal line and positive. The pair could retrace. Moreover, the pair is trading above both its 20 and 50 MAs (respectively at 14.7261 and 14.6475).
WTI Oil
Oil prices extended gains on Thursday as analysts mentioned traders expecting further stockpile reductions after data from the Energy Information Administration (EIA) unexpectedly showed a draw of 2.6 million barrels and also lower stockpiles of gasoline and distillates.
The impending US sanctions on the Iranian oil sector are possibly one key driver for prices, with the Wall Street Journal reporting that Iranian exports are reducing at a faster pace than what the majority of analysts had estimated.
On Friday the US Baker Hughes Oil Rig count will be released, indicating the number of currently operating oil rigs.
Pivot:69.95Support:69.9569.5569.15Resistance:70.570.9571.3Scenario 1:long @ 70.27 with targets @ 70.50 & 70.95 in extension.Scenario 2:below 69.95 look for further downside with 69.55 & 69.15 as targets.Comment:the RSI advocates for further advance.
US 500
US equity indices closed overall lower after a week of records for the S&P 500 (US 500) and the NASDAQ (US Tech 100). However the S&P 500 is clearly on track for its best performance for the month of August since 2014, proving the saying “Sell in May and go away” this year as wrong, whereby traders claim that average performance between May and October is oftentimes not as good as in the other months.
Electronic Arts (NASDAQ:EA) (-9.83%) suffered a major setback in terms of its stock price after the company reduced its revenue estimates for upcoming quarters and announced a delay of one month rolling out its “Battlefield V” game.
Ford (-2.61%) was again under pressure as the rating agency Moody’s lowered the company’s credit rating to now just marginally above ‘junk’ level. Moody’s cited “performance problems in multiple business units simultaneously” as a reason for this move.
On Friday in the US the Chicago PMI Business Barometer and the University of Michigan Consumer Sentiment statistic will be released.
Pivot: 2912 Support: 2894 2885 2874 Resistance: 2912 2918 2927 Scenario 1: short positions below 2912.00 with targets at 2894.00 & 2885.00 in extension. Scenario 2: above 2912.00 look for further upside with 2918.00 & 2927.00 as targets. Comment: the RSI shows downside momentum. The former rising trend line is acting as resistance.