The dollar hit fresh two-week highs against the other major currencies on Tuesday, after comments by Federal Reserve Vice Chairman Stanley Fischer, who said that the U.S. labor market is almost at full strength and the pace of interest rate increases will be data dependent, added to expectations for an upcoming U.S. rate hike.
The Conference Board said its consumer confidence index rose to an 11-month high of 101.1 this month, from a reading of 96.7 in July, and August’s reading was its highest since September 2015.
Today Germany is to release reports on retail sales and the change in the number of people unemployed; the euro zone is to publish a preliminary report on consumer prices, Canada is to release monthly data on gross domestic product, while the U.S. is to release the ADP nonfarm payrolls report, as well as data on pending home sales and survey data on business activity in the Chicago region. But investors are mainly looking ahead to the nonfarm payrolls report for July, scheduled for Friday.
GBP/USDThe pound was little changed on Tuesday, trading near 1.3113, off lows of 1.3060 hit earlier in the session.
The Bank of England earlier reported that net lending to individuals increased by £3.8 billion in July, compared to expectations for a £4.9 billion rise.
Now in the U.K., traders are awaiting Thursday’s reports on activity in the manufacturing and construction sectors, for further indications on the continued effect that the Brexit decision is having on the economy.
Pivot: 1.312Support: 1.3055 1.303 1.2995Resistance: 1.312 1.3165 1.321Scenario 1: short positions below 1.3120 with targets @ 1.3055 & 1.3030 in extension.Scenario 2: above 1.3120 look for further upside with 1.3165 & 1.3210 as targetsComment: the RSI lacks upward momentum.
Gold prices were under pressure on Tuesday, struggled near five-week lows, as investors focused on the next set of U.S. data.
The precious metal’s prices drifted lower also in Asia on Wednesday, with expectations growing for a Fed rate hike by the end of the year.
Metal traders are now looking ahead to Friday’s nonfarm payrolls report, for further hints on the timing of the next U.S. rate hike.
Pivot: 1325.5Support: 1304.5 1299 1290Resistance: 1325.5 1331.25 1335Scenario 1: short positions below 1325.50 with targets @ 1304.50 & 1299.00 in extension.Scenario 2: above 1325.50 look for further upside with 1331.25 & 1335.00 as targets.Comment: the upward potential is likely to be limited by the resistance at 1325.50.
Oil prices fell Tuesday, with Brent losing nearly 2%, as the dollar rallied and glut worries grew amid forecasts for higher U.S. crude stockpiles, and Iran's remark that it was on target to reach peak production.
It was a second straight day that oil slid on worries of oversupply and a strong dollar, adding to Monday's drop of more than 1% in Brent and WTI.
Crude prices dropped also in Asia on Wednesday, after U.S. industry estimates showed a build in stockpiles last week, infact the American Petroleum Institute said crude oil stockpiles rose 942,000 barrels at the end of last week, and gasoline supplies dropped 1.6 million barrels as the summer driving season nears a close. Distillate supplies rose by 3 million barrels.
Today oil traders will be focusing on U.S. stockpile data reported by EIA, for fresh supply-and-demand signals.
Pivot: 47.5Support: 45.81 45.05 44.1Resistance: 47.5 47.96 48.45Scenario 1: short positions below 47.50 with targets @ 45.81 & 45.05 in extension.Scenario 2: above 47.50 look for further upside with 47.96 & 48.45 as targets.Comment: even though a continuation of the technical rebound cannot be ruled out, its extent should be limited.
U.S. stocks were lower after the close on Tuesday, as losses in the Utilities, Consumer Goods and Oil & Gas sectors led shares lower.
At the close in NYSE, the Dow Jones Industrial Average fell 0.26%, while the S&P 500 index declined 0.20%, and the NASDAQ Composite index declined 0.18%.
Metal traders are now looking ahead to Friday’s nonfarm payrolls report, for further hints on the timing of the next U.S. rate hike. The consensus forecast is that the data will show jobs growth of 180,000 in August, following an increase of 255,000 in the preceding month.
Pivot: 2120 Support: 2120 2042 1992 Resistance: 2220 2250 2350 Scenario 1: long positions above 2120.00 with targets @ 2220.00 & 2250.00 in extension. Scenario 2: below 2120.00 look for further downside with 2042.00 & 1992.00 as targets. Comment: the RSI has just landed on its neutrality area at 50% and is turning up.