The dollar was little changed near five-and-a-half month lows against the other major currencies on Thursday, after upbeat U.S. jobless claims data as the minutes of the Federal Reserve’s March meeting continued to weigh.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending April 2 decreased by 9,000 to 267,000, from the previous week’s total of 276,000. The data came a day after the minutes from the Fed's March policy meeting indicated that the Central Bank is unlikely to raise interest rates before June, due to concerns over global economic growth. Meanwhile, Bank of Japan Governor Haruhiko Kuroda said on Thursday that he will “undertake additional monetary easing” if needed, either by increasing the central bank’s asset purchases or by lowering its deposit rate further below zero, or both.
The euro weakened after senior European Central Bank officials reiterated that they are prepared to inject more stimulus if necessary. The ECB’s chief economist, Peter Praet, said the bank was prepared to do more if the euro zone economy was hit by fresh shocks. The comments were echoed by ECB Vice-President Vito Constancio who said in a speech to the European Parliament that the bank will continue to do whatever it takes to pursue its price stability objective. Separately, ECB President Mario Draghi warned that 2016 would be another challenging year in the bank’s annual report on Thursday.
Today the U.K. is to release data on manufacturing production, while Canada is to round up the week with the monthly employment report.
The euro fell mildly on Thursday, as the minutes from the European Central Bank's March meeting depicted a broadly unified Governing Council on the prospects of implementing comprehensive easing measures, as a means for boosting economic growth throughout the euro area.
The currency pair traded in a tight range between 1.1338 and 1.1454, before closing down 0.19%.
The minutes from the ECB's March policy meeting showed a broadly united Governing Council, which appeared to be supportive of the decisions made by president Mario Draghi.
Investors also digested hawkish minutes from the Fed that it will remain cautious with the timing of future interest rate hikes in the near-term.
Today investors’ focus will be on the U.K. release data on manufacturing production, to gain further information on the strength of the Eurozone and on the possible Brexit’s different scenarios.
Pivot:1.1405Support:1.13251.131.1285Resistance:1.14051.1431.1455Scenario 1:short positions below 1.1405 with targets @ 1.1325 & 1.1300 in extension.Scenario 2:above 1.1405 look for further upside with 1.1430 & 1.1455 as targets.Comment:the RSI is mixed to bearish.
Gold
Gold surged as much as $20 an ounce on Thursday, ahead of a public appearance by Federal Reserve chair Janet Yellen, as investors digested dovish indications from the Fed's March minutes that the U.S. central bank will remain cautious with the timing of its next interest rate hike.
The precious metal traded between $1,224.20 and $1,245.00 an ounce before settling up 1.23% on the day.
The minutes of the FOMC's March meeting, released on Wednesday, depicted a divided Committee, split on whether it should raise the target range of its benchmark Federal Funds Rate when it meets again at the end of the month. Furthermore, the U.S.
Department of Labor said Thursday that initial jobless claims fell by 9,000 to 267,000 last week, slightly below consensus forecasts of 272,000.
Today investors’ focus will be on Kansas City Fed President Esther George’ speech about the U.S. economy, in Nebraska.
Pivot:1234Support:123412281220Resistance:1244.51249.51255.5Scenario 1:long positions above 1234.00 with targets @ 1244.50 & 1249.50 in extension.Scenario 2:below 1234.00 look for further downside with 1228.00 & 1220.00 as targets.Comment:a support base at 1234.00 has formed and has allowed for a temporary stabilisation.
WTI Oil
Crude futures fell sharply on Thursday, erasing some of their massive gains from the previous session, as energy traders reacted to reports of a considerable inventory build at the Cushing Oil Hub and an unexpected increase among exports in Iraq.
WTI crude for May delivery traded in a broad range between $36.70 and $38.29 a barrel, before settling down 1.27% on the session.
Crude prices gave back some of their gains from the prior session on Thursday morning after energy services provider Genscape Inc., reported a weekly build of 255,804 at Cushing through April 5; Cushing is the nation's largest storage facility and the main delivery point for NYMEX oil.
Elsewhere, traders digested bullish reports from the Iraqi state-run South Oil Company, which said Thursday that exports from the nation's Southern Iraq port increased to 3.494 million bpd for the first week of April.
Today investors’ focus will be on Baker Hughes’ rig count.
Pivot:38.39Support:37.1836.535.88Resistance:38.393939.85Scenario 1:short positions below 38.39 with targets @ 37.18 & 36.50 in extension.Scenario 2:above 38.39 look for further upside with 39.00 & 39.85 as targets.Comment:the upward potential is likely to be limited by the resistance at 38.39.
US 500
U.S. stocks suffered their worst single session in six weeks on Thursday, amid heightened fears of an impending global economic slowdown, as a surge in the Japanese yen against the dollar dragged down banking stocks and major indices worldwide.
The dollar crashed more than 1.5% versus the yen, suffering its fifth straight daily loss, to hit a fresh 17-month low at 107.69. It came as investors expressed concerns that the Bank of Japan's current negative interest rate regime might not be enough to prevent one of the world's largest economies from entering an extended period of deflation.
The Dow Jones Industrial Average plunged 0.98%, falling as much as 223 points at session lows; the NASDAQ Composite index lost 1.47%, as pharmaceutical stocks retreated from a significant rally earlier this week; while the S&P 500 Composite index crashed 1.20% with all its 10 sectors that closed in the red, as Financial and Telecommunications stocks lagged.
Pivot: 2020 Support: 2020 1970 1950 Resistance: 2080 2100 2130 Scenario 1: long positions above 2020.00 with targets @ 2080.00 & 2100.00 in extension. Scenario 2: below 2020.00 look for further downside with 1970.00 & 1950.00 as targets. Comment: the RSI has struck against a major resistance around 70% and is reversing down. But prices are challenging the 20-day simple moving average.