The US Dollar declined for the third consecutive day against a basket of other major currencies, with the US Dollar Index (USDX) closing 0.24% lower. The Turkish Lira (TRY) continued to decline to new historic lows against Dollar and Euro over economic concerns as well as the developments of the situation in Syria, where Turkey also has stakes in that conflict. The Russian Ruble (RUB) fell to a 16-months low, which is mostly attributed to the new sanctions on certain influential Russian individuals and entities. However an analyst from Credit Agricole (PA:CAGR) indicated that there might be a consolidation soon. Following the sell-off at the Russian stock market on Monday, the RTX Index was up by 4.43%.
Gold traded gradually higher, while oil jumped above $65 for WTI crude over concerns about the instability in Syria and the Middle-East but also possibly due to reconciliatory statements from Chinese President Xi Jinping on US President Trump’s ‘trade war’ approach.
US equity indices also benefitted by the signs of hope in the US-China trade spat. However the VIX, which is also referred to, as the ‘fear indicator’ stood almost unchanged just above the level of 20, which is still significantly up from the levels seen before the crash in February.
Cryptocurrencies saw a recovery, of the major cryptocoins Ethereum gaining over 5%.
On Wednesday in the United Kingdom the Industrial Production (IP), Manufacturing Output and Merchandise Trade statistics will be released. In the US the Mortgage Bankers' Association will publish mortgage market indicators, while later in the day, the CPI Treasury Budget level will be reported.
The US Dollar was now for the third trading day in a row weaker against the Euro and many other major currencies. In Europe Industrial Production (IP) data in France and Italy alike, failed to meet expectations. In France IP m/m was 1.2% up (expected +1.5%), while in Italy IP was down by 0.5% (expected +0.8%). In the US the Producer Price Index (PPI) surpassed expectations at +0.3% m/m, helping the Federal Reserve to justify additional rate hikes.
On Wednesday in Italy the Retail Sales statistics will be published. European Central Bank President Draghi is set to hold a speech on Wednesday.
Pivot:1.233Support:1.23951.2421.244Resistance:1.2331.23051.2285Scenario 1:long positions above 1.2330 with targets at 1.2395 & 1.2420 in extension.Scenario 2:below 1.2330 look for further downside with 1.2305 & 1.2285 as targets.Comment:the RSI shows upside momentum.
Gold
Gold continued climbing gradually as fears over the situation in Syria increase the uncertainty in the markets. A possible US-coalition strike on Syria raises fear of an extended conflict, in part also due to the involvement of Russia and Iran in that conflict. The weaker Dollar further helped the gold price to rise as it is generally assumed that a weaker Dollar makes Dollar-traded gold cheaper in non-gold economies and thus affects demand.
After the publication of PPI data on Tuesday, on Wednesday in the US Consumer Price Index (CPI) data is due for publication.
Pivot:1331Support:13311326.751323Resistance:1348.513561361.5Scenario 1:long positions above 1331.00 with targets at 1348.50 & 1356.00 in extension.Scenario 2:below 1331.00 look for further downside with 1326.75 & 1323.00 as targets.Comment:the RSI is bullish and calls for further advance.
WTI Oil
Despite the crude oil stockpiles rising by 1.8M barrels according to data from the American Petroleum Institute (API), which was published late on Tuesday, the oil prices increased sharply for the second day in a row. The announcement by US President Trump to use military options against Syria in the next couple days as a response to an alleged poisonous gas attack shook the markets as this could have implications on the region as well as on Russia, which is heavily invested in Syrian affairs.
On Wednesday the Energy Information Administration (EIA) will publish its oil stockpiles statistic. On Thursday the OPEC is set to publish its oil market report. Then on Friday the International Energy Agency (IEA) will release its Oil Market Report.
Pivot:64.15Support:64.1563.262.8Resistance:66.166.5567.35Scenario 1:long positions above 64.15 with targets at 66.10 & 66.55 in extension.Scenario 2:below 64.15 look for further downside with 63.20 & 62.80 as targets.Comment:the RSI is supported by a rising trend line.
US 500
US equity indices traded very clearly higher on Tuesday, as China’s President Xi Jinping vowed to further open his country’s economy and offered some concessions in terms of trade to the US. Especially stocks from chip-makers (US Semiconductors ETF +2.96%) and biotech companies (US Biotech ETF +2.89%) companies pushed higher.
Stocks of Micron (+5.15%) were trading higher, following a positive analyst statement on the company. Airline stocks declined over concerns of rising oil prices, with American Airlines (-4.91%) hitting a 2-month low.
Among other companies, on Thursday Delta Air Lines (NYSE:DAL) and on Friday JP Morgan Chase (NYSE:JPM), Citigroup (NYSE:C) and Wells Fargo (NYSE:WFC) are set to publish their quarterly earnings. More earnings are due the following week.
Pivot: 2612 Support: 2612 2584 2560 Resistance: 2672 2685 2700 Scenario 1: long positions above 2612.00 with targets at 2672.00 & 2685.00 in extension. Scenario 2: below 2612.00 look for further downside with 2584.00 & 2560.00 as targets. Comment: the RSI is mixed to bullish.