The dollar slid against the other major currencies on Friday, following the release of lackluster U.S. economic reports, but the greenback still ended the week higher.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell 0.27% in late trade, but was still up 0.46% for the week.
The drop in the dollar came after reports showing that U.S. industrial production fell more than expected in March and consumer sentiment deteriorated slightly this month. The University of Michigan said the preliminary reading of its consumer sentiment index came in at 89.7 in April, down from 91.0 in March and lower than the 92.0 reading forecast by economists. Another report showed that U.S. industrial output fell 0.6% in March, worse than the 0.1% decline economists had expected.
The reports underlined the view that the Federal Reserve is likely to stick to a cautious approach on future interest rates increases.
In the week ahead the U.S. set to release housing sector data; the European Central Bank will hold its monetary policy meeting on Thursday, and the euro zone is to release data on private sector activity on Friday.
Today New Zealand is to release data on consumer price inflation and Canada is to report on foreign securities purchases.
The euro rose against the U.S. dollar on Friday, after a release of downbeat U.S. economic reports, which sparked fresh concerns over the strength of the economy, dampening demand for the greenback.
EUR/USD hit 1.1296 during U.S. morning trade, the pair’s highest since Wednesday; and subsequently consolidated up 0.41%. The euro also higher against the pound, with EUR/GBP up 0.21%.
This week investors’ focus will be on ECB monetary policy meeting on Thursday, and euro zone data on private sector activity on Friday.
Pivot:1.1245Support:1.12451.12151.1185Resistance:1.1321.13451.137Scenario 1:long positions above 1.1245 with targets @ 1.1320 & 1.1345 in extension.Scenario 2:below 1.1245 look for further downside with 1.1215 & 1.1185 as targets.Comment:even though a continuation of the consolidation cannot be ruled out, its extent should be limited.
Gold
Gold prices rose on Friday, as the dollar slid against the other major currencies, following the release of lackluster U.S. economic reports.
The precious metal settled up 0.75% for the day, but ended the week down 0.86%, reversing all its early gains after hitting a three-week high of $1,262 an ounce on Tuesday.
In the week ahead gold traders will focus on U.S. housing sector data, weekly report on initial jobless claims and data on manufacturing activity in the Philadelphia region, for further information on the strength of the greenback.
Pivot:1235.5Support:123012271224Resistance:124412511259Scenario 1:long positions above 1230.00 with targets @ 1244.00 & 1251.00 in extension.Scenario 2:below 1230.00 look for further downside with 1227.00 & 1224.00 as targets.Comment:the RSI is mixed with a bullish bias.
WTI Oil
Oil prices fell sharply on Friday, amid doubts that Sunday’s meeting of major suppliers in Doha, Qatar, would result in an agreement to freeze output or that it will have a meaningful impact.
Crude oil for delivery in May settled at $40.41 a barrel at the close, down 2.63% for the day, paring the week’s gains to 0.52%.
WTI prices plunged in Asia on Monday, as major oil producers gathered in Doha failed at the weekend to reach an agreement to freeze production. The producers—Saudi Arabia, Russia, Kuwait, and other OPEC members, but not including Iran—met most of the day but broke up toward evening without a deal. Saudi Arabia had insisted there could be no agreement unless Iran froze production, too. But Tehran did not attend the meeting and said it needs time to recover from three years of oil sanctions.
In the week ahead, market players will be focusing on data from industry group the American Petroleum Institute on Tuesday, ahead of Wednesday’s weekly government report on stockpiles will also be in focus.
Pivot:40Support:37.636.835.9Resistance:4040.841.75Scenario 1:short positions below 40.00 with targets @ 37.60 & 36.80 in extension.Scenario 2:above 40.00 look for further upside with 40.80 & 41.75 as targets.Comment:the RSI is capped by a bearish trend line.
US 500
U.S. stocks were lower after the close on Friday, as losses in the Oil & Gas, Technology and Financials sectors led shares lower.
At the close in NYSE, the Dow Jones Industrial Average declined 0.16%, while the S&P 500 index went down 0.10%, and the NASDAQ Composite index lost 0.16%.
The top performers on the S&P 500 were Transocean Ltd (NYSE:RIG), Urban Outfitters Inc (NASDAQ:URBN) and Regions Financial Corporation (NYSE:RF); while the worst performers were Vertex Pharmaceuticals Inc (NASDAQ:VRTX), Seagate Technology (NASDAQ:STX) PLC and National Oilwell Varco Inc (NYSE:NOV).
In the week ahead gold traders will focus on U.S. housing sector data, weekly report on initial jobless claims and data on manufacturing activity in the Philadelphia region, for further information on the strength of the American economy.
Pivot: 2020 Support: 2020 1970 1970 Resistance: 2100 2115 2130 Scenario 1: long positions above 2020.00 with targets @ 2100.00 & 2115.00 in extension. Scenario 2: below 2020.00 look for further downside with 1970.00 & 1950.00 as targets. Comment: investors have to remain cautious since these levels may trigger profit taking.