The US Dollar traded stronger against other major currencies on Thursday, with the US Dollar Index (USDX) gaining 0.62% on Thursday.
Gold traded lower as the Dollar and 10 Year US Treasury Note yields gained. A stronger Dollar makes gold, which is predominantly traded in Dollar, more expensive in economies not using the Dollar as their national currency. Oil traded largely unchanged on Thursday but was pressured early on Friday on reports that Russia would target an increased production of up to 250,000 barrels per day.
Bitcoin and other cryptocurrencies were under pressure as Bitcoin retraced from its recent high level, falling below the $8,000 mark. This comes as the SEC rejected the application of the Winklevoss twins to allow listing of their cryptocurrency ETF on regulated exchanges. The SEC cited among other factors the fact that most of Bitcoin transactions are not traded in the US and that the cryptocurrency is not immune to market manipulations as some of the reasons for the rejection.
On Friday France will publish its Gross Domestic Product (GDP) and Consumer Manufactured Goods Consumption statistics. Italy will release its Producer Price Index (PPI) data. In the US GDP data and the University of Michigan Consumer Sentiment will be released. The Russian central bank is due to make its interest rate decision. Surveyed analysts expect the rate to stay at 7.25%.
The EUR/USD traded lower on Thursday after the European Central Bank announced that it will not change its policy of unwinding the bond purchase program by the end of this year and no indications for soon to come rate hikes.
The Italian ISAE Consumer Confidence level was reported higher at 116.3 (expected 115.9). In the US New Jobless Claims were reported higher than the previous week at 217 thousand, however still below expectations of 219 thousand. Durable Goods New Orders were however below expectations at only +1.0% m/m (expected +3.2%).
On Friday France will publish its Gross Domestic Product (GDP) and Consumer Manufactured Goods Consumption statistics. Italy will release its Producer Price Index (PPI) data. In the US GDP data and the University of Michigan Consumer Sentiment will be released.
Pivot:1.167Support:1.16251.161.158Resistance:1.1671.17051.173Scenario 1:short @ 1.1647 with targets @ 1.1625 & 1.1600 in extension.Scenario 2:above 1.1670 look for further upside with 1.1705 & 1.1730 as targets.Comment:as long as the resistance at 1.1670 is not surpassed, the risk of the break below 1.1625 remains high.
Despite the strong Dollar, the Mexican Peso managed to reach a new 12-weeks low in the USD/MXN. While unemployment for June was reported higher at 3.4% (previous 3.2%) in Mexico, the markets remain optimistic, following reports that Mexico might announce a deal with the United States on trade next month.
One of the reason for the recent gains in the MXN given by analysts, are the easing concerns about the leftist president elect Andres Manuel Lopez Obrador, who is expected to have pragmatic approach in terms of economic policies.
On Friday Mexico will release its Trade Balance data for June. Next week data on Fiscal Balance, GDP, Manufacturing PMI, Consumer Confidence and an interest rate decision by the Mexican Monetary Policy Committee is expected.
Pivot:18.5802Support:18.580218.507118.4636Resistance:18.777918.821418.865Scenario 1:rebound towards 18.7779.Scenario 2:the downside breakout of 18.5802 would call for 18.5071 and 18.4636.Comment:the RSI is below 50. The MACD is negative and above its signal line. The configuration is mixed. Moreover, the pair stands below its 20 and 50 MAs (respectively at 18.6453 and 18.6681).
US Tech 100
The NASDAQ (US Tech 100) fell during regular hours trading, while the future index contracts managed to close higher.
Key mover was the drop in Facebook (NASDAQ:FB) (-19.36%) shares, which marked the biggest loss in terms of market capitalization any US company suffered in history in a single day. Founder Mark Zuckerberg, who is still a key shareholder in the company, lost almost $17 bn. following the release of the earnings, which indicated stagnating user growth and falling margins over the coming years, while data breaches in recent years were also of concern to investors.
Spotify (+4.67%) hit a new all-time high as the company not only hit the revenue estimates but managed to grow more than expected in terms of active premium and fee users. The company mentioned that they largely managed to work with the new European GDPR regulation.
Amazon (NASDAQ:AMZN) (-2.99%) managed to recover most of its losses in after-hours trading, after the company reported higher earnings per share (EPS) than expected, while revenue at $52.89 bn. fell slightly short of the set expectations.
On Friday Twitter will release its earnings before the market opens.
Pivot:7406Support:740673867362Resistance:746274907530.75Scenario 1:long positions above 7406.00 with targets at 7462.00 & 7490.00 in extension.Scenario 2:below 7406.00 look for further downside with 7386.00 & 7362.00 as targets.Comment:the RSI is bullish and calls for further upside.
US 500
US equity indices traded mixed during regular trading hours, but managed to close altogether higher in late trading. Especially utility company (US Utilities ETF +1.32%) and chip makers’ (US Semiconductors ETF +1.46%) traded higher in the trading session.
McDonald’s (-1.73%) stocks failed to gain in after-hours trading despite earnings and revenue surpassing expectations as in the highly competitive domestic market its sales were below expectations.
MasterCard (-3.17%) and Visa (-0.12%) closed lower despite earnings beating estimates and strong growth. Analysts indicated that Visa was expected to show stronger growth numbers in term of payment volume, while MasterCard faces lawsuits from its merchants.
Ford (-5.9%) shares fell to their lowest point since 2012 after the company reported that profits were reduced by almost half and also missing investors’ expectations, while the company also announced that it would spend up to $11 bn. on restructuring in the coming 3 to 5 years.
On Friday among other companies Exxon Mobil (NYSE:XOM), Chevron (NYSE:CVX), Colgate-Palmolive are set to release their earnings. Then on Monday Caterpillar (NYSE:CAT), on Tuesday BP (LON:BP), Pfizer (NYSE:PFE) and Procter & Gamble and on Wednesday Garmin and Ferrari (NYSE:RACE) are due to release their earnings.
Pivot: 2833 Support: 2833 2827.5 2821.75 Resistance: 2849.5 2854 2863 Scenario 1: long positions above 2833.00 with targets at 2849.50 & 2854.00 in extension. Scenario 2: below 2833.00 look for further downside with 2827.50 & 2821.75 as targets. Comment: the RSI is supported by a bullish trend line. The key support at 2833 should maintain the buying interest.