Currencies
EUR/USD – yesterday it was still supported by the support around the 1.1375 level, but this morning it has dropped (finally) below this level in the aftermath of the German GDP data. The overall Eurozone GDP is also likely to give us some more volatility in a little bit. Later today we also have a range of important data out of the US, so it is definitely not a boring day today.
USD/JPY –tested the resistance mentioned yesterday again, and is moving down again as it was unable to breach the resistance. While there is an expectation that the BOJ will ease monetary policy, it remains doubtful we can see the JPY weaken too much, as we have been caught off guard already before at the end of April. However, an interest rate increase in the US would obviously cause a weakening of the JPY.
GBP/USD – saw some large moves yesterday due to the rate vote and the BOE outlook. Initially we saw a spike up, as there was no vote to lower the interest rate at the moment. However, after the comments from BOE Governor Carney, we saw the GBP weaken as he said that while it is likely that the BOE will increase the interest rate within the next 3 years, it is also possible for the BOE to lower the interest rate further if needed. There were also again severe warnings against the effects of a Brexit.
Commodities
Gold – is still struggling to overcome the resistance around the 1276 level for the last few days and keeps testing this level. The main question is obviously if the FED will raise the interest rate next month or not, and that is also what is driving the price.
Oil – extended its gains to reach the highest level since November, as Nigerian oil production dropped by 600,000 after a string of attacks. In addition the IEA expects the global oversupply to be smaller than previously estimated due to an increased demand from India. However, the oversupply is still estimated to be well over 1 mbpd. In addition to that, Iranian production is increasing rapidly and reached 3.5 and exported 2 mbpd as well in April.
Stocks
Apple (NASDAQ:AAPL) – with all the rumors about an Apple car, it has now taken its first real public action and will be investing $1 billion in Didi, the Chinese version of Uber and one of its competitors. This comes as Apple is looking to expand the range of products it can offer, especially after the last earnings are showing that the smartphone market appears to become saturated.
By Shawn Koopman