On Thursday the US Dollar traded lower against other major currencies, with the US Dollar Index (USDX) closing 0.21% lower. However in early trading on Friday these losses were covered by a strong Dollar moving the USDX after Wednesday again above the 94 threshold. Emerging market currencies reacted differently in this sentiment, with the Turkish Lira (TRY) but also Polish Zloty (PLN) trading weaker against the Greenback, while the South African Rand (ZAR) and Mexican Peso (MXN) were able to further recover.
Gold traded at a one week high, above $1,300 as the meeting between the leaders of North Korea and the US was scrapped by the US President, accusing North Korea of “tremendous anger and open hostility”. Oil further declined as Russia announced support for the possibility of reducing the oil production restrictions under the OPEC deal, should the conditions in June allow such a move.
Most major cryptocurrencies again faced losses with Bitcoin hitting a new 6 weeks low. On Thursday it was announced that the US Department of Justice is investigating market manipulations by traders in the digital currencies market.
On Friday the United Kingdom is going to release its most recent Gross Domestic Product (GDP) data. In the US data on Durable Goods New Orders and the University of Michigan Consumer Sentiment are going to be released.
The EUR/USD stabilized on Thursday trading overall higher. However during early trading on Friday, the Dollar continued to strengthen as traders seems to brush aside concerns over the increasingly confrontational tone between the leadership of the US and North Korea.
On Thursday the US showed mixed economic data, with Jobless New Claims at 234 thousand (expected 220 thousand) and Existing Home Sales at 5.46 million below the expected 5.6 million.
On Friday in Germany the influential IFO Survey on Current Conditions, Economic Sentiment and Business Expectations is set to be released.
Pivot:1.173Support:1.16951.16751.165Resistance:1.1731.1751.177Scenario 1:short positions below 1.1730 with targets at 1.1695 & 1.1675 in extension.Scenario 2:above 1.1730 look for further upside with 1.1750 & 1.1770 as targets.Comment:the RSI shows downside momentum.
Gold
Gold pushed higher on Thursday, pushing above the level of $1,300 for the first time in over a week as tensions between the US and North Korea continued to rise. Now both sides seem to be going away from the planned meeting between the North Korean Leader Kim and US President Trump, which was set to take place in June in Singapore. The moderate decline of the Dollar and the 10 Year US Treasury Note staying below the 3 percent threshold further allowed gold to gain some ground. After seeing the biggest decline in on a weekly basis last week, gold is on its way to close this week higher.
In the US on Friday data on Durable Goods New Orders and the University of Michigan Consumer Sentiment are going to be released.
Pivot:1298Support:129812931288Resistance:130713111315Scenario 1:long positions above 1298.00 with targets at 1307.00 & 1311.00 in extension.Scenario 2:below 1298.00 look for further downside with 1293.00 & 1288.00 as targets.Comment:the RSI is mixed with a bullish bias
WTI Oil
Oil further declined on Thursday, now for the third consecutive day this week, which could end the winning streak, that has been going on for 3 weeks. Oil is under pressure after the Energy Information Administration (EIA) published data on oil stockpiles in the US with stocks unexpectedly increasing by 5.8 million barrels. After rumors started circulating that OPEC could review its productions quotas at their meeting in June, Russian Energy Minister Novak indicated that OPEC and non-OPEC countries covered by the deal, such as Russia, could ‘softly’ ease production restrictions, depending on how the situation looks like in June.
On Friday the Baker Hughes Oil Rig Count for the US will be released, indicating the amount of operating oil rigs in the US. The count did not drop for the last 7 consecutive weeks.
Pivot:71.2Support:70.257069.8Resistance:71.271.4571.75Scenario 1:short positions below 71.20 with targets at 70.25 & 70.00 in extension.Scenario 2:above 71.20 look for further upside with 71.45 & 71.75 as targets.Comment:the RSI is capped by a declining trend line.
US 500
US equity indices futures, such as the S&P 500 (US 500) traded marginally higher on Thursday, thanks to a recovery in the later trading hours. Especially utility (US Utilities ETF +0.70%) and industrial (US Industrial ETF +0.58%) shares traded higher, while energy (US Energy ETF (NYSE:XLE) -1.56%) and financial sector (US Financials ETF -0.64%) shares had to face losses.
The US financial company Wells Fargo (NYSE:WFC) (-2.59%) traded sharply lower, after just reaching an 8 weeks high, as the company is looking into moving back into the car loan business, after trying to shrink its portfolio of sub-prime loans in that segment. Analysts point out that this move could bring higher near-term profits, but also expose the company to higher possible losses in the longer run.
General Electric (NYSE:GE) (+2.90%) made up a small part of the heavy losses it sustained on the previous day, which were attributed by analysts to a speech by its CEO. GE is under pressure due to several non-performing segments and is rumored to be selling its insurance business soon.
The earning season continues next week, albeit with much less companies reporting their numbers than at the height of the season. Among other companies Costco (NASDAQ:COST) and Salesforce are set to publish their quarterly earnings.
Pivot: 2720 Support: 2720 2712 2705 Resistance: 2742.5 2748 2754 Scenario 1: long positions above 2720.00 with targets at 2742.50 & 2748.00 in extension. Scenario 2: below 2720.00 look for further downside with 2712.00 & 2705.00 as targets. Comment: the RSI calls for a rebound. The upside breakout of a falling trend line should confirm a bullish outlook.