The dollar continued to gain on Monday against most other major currencies, as Friday's U.S. employment data continue to provide support and as trading was expected to remain thin with no major U.S. data to be released. Sentiment on the euro remained vulnerable as Greece and the euro zone held a fresh round of talks on Monday in an attempt to reach an agreement on a package of economic reforms in order to access fresh bailout funds. Ahead of the talks Greece's government indicated that it was still hopeful that progress would be made but euro zone officials have indicated that too many issues still remain unresolved. Greece was due to repay approximately €770 to the International Monetary Fund on Tuesday. Elsewhere, the Bank of England kept its interest rates unchanged at 0.50%, where it has been since March 2009, and maintained asset purchases at £375 billion. The pound had rallied to more than two-month highs against the dollar on Friday after Prime Minister David Cameron's Conservative Party won a surprise majority in British elections.
The EUR/USD posted a slight drop on Monday, trading below 1.12 once more as fears of a Greek exit from the European Union continued to add pressures on the currency pair. In Greece, government officials eased concerns that it could default on its obligations this week, by confirming that it has started making payments to the International Monetary Fund on Tuesday on a €750 million loan. In Brussels, there are still concerns that Greece could default and leave the EU while Eurogroup chair Jeroen Dijsselbloem applauded Greece's renewed efforts and emphasized that more time is needed to reach an agreement. On Tuesday, the Economic and Financial Affairs Council is to hold talks in Brussels. In the U.S, the JOLTS job openings report is due to be announced later in the day, together with a speech from a member of the FOMC.
Pivot
1.111
Support
1.111
1.1065
1.101
Resistance
1.1245
1.1285
1.132
Scenario 1: Long positions above 1.111 with targets @ 1.1245 & 1.1285 in extension.
Scenario 2: Below 1.111 look for further downside with 1.1065 & 1.101 as targets.
Comment: The pair is rebounding and is breaking above its resistance.
Gold traded slightly lower on Tuesday following developments in Europe for last-minute talks on Greece's ability to make a major debt payment. The drop in prices reversed the modest gains from last week, as continuing negotiations regarding the Greece debt crisis remained in focus. The metal received pressure from recent strength in the dollar while investors will continue to keep an eye on the negotiations between Greece and its international creditors as well as on data from the U.S for further indications on the health of the U.S. economy.
Pivot
1194
Support
1178.6
1169.5
1160
Resistance
1194
1197.5
1200
Scenario 1: Short positions below 1194 with targets @ 1178.6 & 1169.5 in extension.
Scenario 2: Above 1194 look for further upside with 1197.5 & 1200 as targets.
Comment: As long as 1194 is resistance, likely decline to 1178.6..
OIL/USD
Crude oil prices move slightly higher on Tuesday ahead of U.S. industry data on inventories with gasoline in focus as the summer driving season in the U.S. is approaching. The API will report supplies of crude, gasoline and distillates for last week later on today. Gasoline inventories will be in focus as refineries are preparing to increase production ahead of the summer driving season. OPEC, meanwhile, reportedly indicated that it does not see prices rising over $100 a barrel in the next decade. OPEC predicts that crude will be priced at $76 in 2025 under its most optimistic forecast. Markets will be focusing on the more closely-watched data from the U.S. Department of Energy on Wednesday.
Pivot
59.8
Support
58.15
57.3
56.55
Resistance
59.8
60.5
61.3
Scenario 1: Short positions below 59.8 with targets @ 58.15 & 57.3 in extension.
Scenario 2: Above 59.8 look for further upside with 60.5 & 61.3 as targets.
Comment: As long as 59.8 is resistance, likely decline to 58.15..
DOW JONES
U.S. stocks posted a solid drop on Monday on concerns regarding Greece and China, retreating from Friday's rally. Losses in the Oil & Gas, Telecoms and Utilities sectors led the main U.S indices lower. The Dow Jones Industrial Average fell by approximately 0.47% with the worst performers of the session being Exxon Mobil Corporation (NYSE:XOM), which fell 1.68% and General Electric Company (NYSE:GE) which declined 1.61%. In the U.S, the JOLTS job openings report is due to be announced later in the day, together with a speech from a member of the FOMC.
Pivot
17585
Support
17585
17040
16330
Resistance
18290
18900
19200
Scenario 1: Long positions above 17585 with targets @ 18290 & 18900 in extension.
Scenario 3: Below 17585 look for further downside with 17040 & 16330 as targets.
Comment: The RSI broke above a bearish trend line.
Twitter (NYSE:TWTR)'s stock price has dropped 27-percent after 1st quarter earnings announced in the end of April, as figures disappointed investors. Numbers were released in error an hour ahead of schedule, enough time for the stock to react negatively into the close. Twitter shares dropped 18 percent that day as revenues were $436 million in the quarter, missing the company's guidance of $440 million to $450 million as well as forecasts for $456 million. The sell side reacted to the disappointing quarter by handing out at least five downgrades and at least 15 price target cuts and according to reports it is very possible the problems of the company may take several quarters to resolve
Pivot
54.2
Support
36.2
35.1
34
Resistance
54.2
56.7
58.2
Scenario 1: the downside prevails as long as 54.2 is resistance.
Scenario 2: the upside breakout of 54.2 would call for 56.7 and 58.2.
Comment: the RSI is trading below 30. This could mean that either the stock is in a lasting downtrend or just oversold and that therefore a rebound could shape.