Amid mixed economic data in the US, the Dollar briefly paused its climb, as the US Dollar Index (USDX) closed 0.33% lower on Thursday, the most significant decline in over 2 weeks. While emerging markets were already under pressure due to the strong Dollar and high yields on US Treasuries, the Turkish Lira (TRY) fell to its lowest level against the Dollar, as the USD/TRY almost reached the 4.25 mark in early trading on Friday. The high inflation, reported at 11% y/y is seen as one of the key problems for the Turkish economy.
Gold traded higher as the weaker Dollar and lower US Treasury Yield eased the pressure on the precious metal safe-haven. Oil was pushed higher on renewed concerns about US sanctions on Iran.
Mixed economic results from the US and trade war concerns, but also disappointing earnings from several companies pushed most US equity indices lower on Thursday.
On Friday the US will publish its key labour market indicators with the Nonfarm Payrolls (NFP), Unemployment Rate, Average Hourly Earnings and Average Work Week statistics. In Canada the Ivey Purchasing Managers' Index will be released.
The EUR/USD traded higher on Thursday for the first time this week so far, while also being pushed back down at the resistance level around 1.20. European inflation data with the Harmonised Index of Consumer Prices (HICP) released on Thursday at +1.2% y/y (expected +1.4%) fell below expectations. Data from the US was mixed with Nonfarm Productivity at 0.7% (expected 0.9%) q/q, Unit Labor Costs at 2.7% (expected 3%) q/q and the ISM Non-Manufacturing Index at 56.8 (expected 58.4) below expectations, while Jobless New Claims at 211 thousand (expected 224 thousand), Factory orders at 1.6% *expected 1.3%) m/m and the Trade Balance Deficit at $49B (expected deficit of $49.9B) were better than expected.
On Friday in Germany the Services PMI and in the European Union the Composite PMI and Retail Sales figures will be released. In the US the key event will be the publication of the Nonfarm Payrolls (NFP) on Friday.
Pivot:1.195Support:1.1951.19151.188Resistance:1.2011.20351.206Scenario 1:long positions above 1.1950 with targets at 1.2010 & 1.2035 in extension.Scenario 2:below 1.1950 look for further downside with 1.1915 & 1.1880 as targets.Comment:the RSI shows upside momentum.
Bitcoin reached its highest level in over 7 weeks on Thursday. The second most popular cryptocurrency by market capitalization – Ethereum gained again significantly on Thursday and is one of the better performing major cryptocurrencies this week so far, surpassing Bitcoin, Ripple and Litecoin in terms of performance and also reaching a positive year-to-date level on Thursday.
Recently Reddit announced to work on accepting Bitcoin once again, after dropping the acceptance of the cryptocurrency in March. The investment bank Goldman Sachs (NYSE:GS) announced to build a crypto trading unit and to start trading on customer’s behalf, should it get the regulatory approval.
Pivot:9397Support:948393979178Resistance:98821001310144Scenario 1:as long as 9397 is support look for 10013.Scenario 2: below 9397, expect 9178 and 9047.Comment:the RSI is above 50. The MACD is below its signal line and positive. The pair could retrace. Moreover, the pair is below its 20 MA (9638) but above its 50 MA (9446).
WTI Oil
Oil traded again higher on Thursday, with WTI oil trading at its peak less than 1.3% below the monthly high. Analysts saw the building tensions surrounding Iran as a key issue pushing prices higher. As US President Trump repeatedly called the nuclear deal with Iran, that his predecessor in office reached a bad deal, the Iranian leadership indicated that it would not be ready to renegotiate the agreement.
On Friday the Baker Hughes Oil Rig Count for the US will be released, indicating the production activities of US oil rigs. On Wednesday the Energy Information Administration (EIA) announced that US crude oil production rose to 10.6 million barrels in the last week.
Pivot:67.75Support:67.7567.266.85Resistance:68.969.3570Scenario 1:long positions above 67.75 with targets at 68.90 & 69.35 in extension.Scenario 2:below 67.75 look for further downside with 67.20 & 66.85 as targets.Comment: the RSI lacks downward momentum. Even though a consolidation cannot be ruled out, its extent should be limited before further advance.
US 500
US equity indices traded mostly lower, except for the Dow Jones Industrial Average (US 30), which closed marginally higher during regular trading hours. The S&P 500 (US 500) meanwhile had an intraday dip to the lowest level seen in almost 4 weeks, falling below the 2,600 mark.
Especially bank (US Banks ETF -0.89%) and biotech (US Biotech ETF -1.48%) stocks traded lower, while moderate gains were seen among basic material (US Basic Materials ETF +0.56%) and industrial (US Industrials ETF +0.20%) stocks.
Tesla (NASDAQ:TSLA) (-5.72%) closed significantly lower with intraday lows at around the $275 level, after CEO Elon Musk received a lot of criticism for his conduct in the conference call, following the publication of the quarterly earnings. The company’s bonds were also negatively affected by an even higher yield.
Spotify (-5.78%), which only recently started trading in public was trading lower as the quarterly earnings fell short of investors’ expectations. The currently seen price is however still well within the range seen on the first trading day of the stock.
On Friday among other companies Alibaba (NYSE:BABA) and Celgene (NASDAQ:CELG) are set to publish their quarterly earnings.
Pivot: 2610 Support: 2610 2595 2568.5 Resistance: 2642.5 2657 2682 Scenario 1: long positions above 2610.00 with targets at 2642.50 & 2657.00 in extension. Scenario 2: below 2610.00 look for further downside with 2595.00 & 2568.50 as targets. Comment: the RSI calls for a rebound. A bullish cross has just been identified between the 20-period and 50-period moving averages.