The Dollar continued to show strength in the new week, as the US Dollar Index (USDX), which measures the performance of the Dollar against other major currencies, settled 0.18% higher. Over the course of the last 3 weeks the index closed only on 3 of the 15 trading days lower.
Gold reached a weekly high on Monday but traded again lower early on Tuesday as possible Iran sanctions drove uncertainty and the strong Dollar and high yield on US Treasuries put pressure on the price of the previous metal. WTI crude oil remained around the $70 mark, as markets are awaiting the US decision sanctions and the API oil inventories report.
US equities traded mixed, with especially technology and industrial stocks trading higher. Among other companies Walt Disney is set to publish its quarterly earnings on Tuesday.
Major cryptocurrencies such as Bitcoin and Ethereum traded in the morning hours almost unchanged to the previous day. Cryptocurrency enthusiasts blame the critical comments from Warren Buffet and Bill Gates over the weekend, for Bitcoin falling below the weekend high at almost $10,000.
On Tuesday in the United Kingdom the Halifax House Price Index (HPI) is scheduled to be released. In The US the NFIB Small Business Optimism Index and Redbook Store Sales statistics will be published, while in Canada the Housing Starts data is expected.
The EUR/USD reached another year-to-date low dipping below the 1.19 threshold in an intraday move on Monday. The Dollar is said to be supported by the overall economic optimism but also by the expectations that the interest rates set by the Federal Reserve would rise, while other central banks are slower in raising rates and thus making investment in Dollar denominated assets more attractive.
German Manufacturers' Orders published on Monday were at -0.9% m/m below the expectations of an increase by +0.5%. The Consumer Credit in the US was at $11.6B m/m also below expectations, which saw it at $15.6B. Consumer Credit is also seen as an indicator for consumer spending.
On Tuesday Germany is set to publish its Industrial Production (IP) and Merchandise Trade statistics.
Pivot:1.195Support:1.18951.1881.1855Resistance:1.1951.1981.201Scenario 1:short positions below 1.1950 with targets at 1.1895 & 1.1880 in extension.Scenario 2:above 1.1950 look for further upside with 1.1980 & 1.2010 as targets.Comment:as long as the resistance at 1.1950 is not surpassed, the risk of the break below 1.1895 remains high.
While not reaching a new high on Monday, the USD/TRY traded at the end of Monday’s trading at its highest closing rate yet seen. Analysts see the risk of Iran-sanctions as another threat to the embattled currency as it would be hard hit by further rising oil prices. In the previous week the downgrade of the sovereign rating by S&P to BB- further below the investment-grade level unsettled investors. S&P cited in its downgrade decision imbalances in the economy risking a “hard landing”. In March the rating agency Moody’s downgraded its credit rating for Turkey to Ba2, which is two steps below investment-grade.
On Tuesday in Turkey the Treasury Cash Balance for April will be published.
Pivot:4.2582Support:4.26664.25824.2369Resistance:4.30134.3144.3267Scenario 1:the upside prevails as long as 4.2582 is support.Scenario 2:the downside breakout of 4.2582 would call for 4.2369 and 4.2242.Comment:the RSI is above 50. The MACD is above its signal line and positive. The configuration is positive. Moreover, the pair is above its 20 and 50 MAs (respectively at 4.2690 and 4.2605).
WTI Oil
Oil retraced from the 3-1/2 year high seen on Monday as the position of the US towards Iran and its nuclear program, which Israel allegedly uncovered, yet to be seen. Under the deal in place the US eased some of the sanctions in place. Some analysts estimate a loss of 0.4 million barrels per day supply from Iran, should the US reinstate sanctions.
On Tuesday the American Petroleum Institute (API) will release oil stockpile figures, followed by the Energy Information Administration (EIA) on Wednesday.
Pivot:70.3Support:69.568.9568.25Resistance:70.370.871.1Scenario 1:short positions below 70.30 with targets at 69.50 & 68.95 in extension.Scenario 2:above 70.30 look for further upside with 70.80 & 71.10 as targets.Comment:the RSI is capped by a declining trend line.
US Tech 100
US equity futures indices traded mixed with the NASDAQ (US Tech 100) and Russell 2000 (US 2000) trading higher, while marginal losses were seen in the S&P 500 (US 500) and the Dow Jones Industrial Average (US 30) future.
Financial (US Financials ETF +0.70%) and industrial (US Industrial ETF +0.76%) stocks were some of the best performing sectors on Monday, while non-cyclicals (US Non-Cyclicals ETF -0.58%) and utilities (US Utilities ETF -0.54%) stocks traded lower.
Tesla (NASDAQ:TSLA) (+3.16%) yet again surpassed the $300 mark as the CEO Elon Musk announced that he bought $9.85M worth of Tesla stocks as he promised to “burn” short sellers of the company, despite analysts predicting a dangerous cash expenditure of the company.
As companies publish their quarterly earnings, the earnings season could bring new impulses to the markets. Among other companies on Tuesday Walt Disney and on Thursday Nvidia are set to disclose their quarterly earnings.
Pivot: 6741 Support: 6741 6675 6610 Resistance: 6865 6929.25 6990 Scenario 1: long positions above 6741.00 with targets at 6865.00 & 6929.25 in extension. Scenario 2: below 6741.00 look for further downside with 6675.00 & 6610.00 as targets. Comment: the RSI is supported by a rising trend line.