SUMMARY

  • Retail sales in Spain came in at +0.3%, compared to +0.9% in the previous month. German CPI came in at +0.1% versus 0.5% in the previous month, indicating a decline, a favorable result for the euro zone.
  • Switzerland’s annual GDP is expected to increase by +0.6% y/y. The Eurogroup meeting continues today. There is a high probability that the ECB will cut interest rates at its June meeting.
  • The Dow Jones remains under downward pressure. Yesterday, the index closed with a correction of -1.08%. At the moment, the index is down -0.78% and trades at 38,225 points.

 

Main events:

  • GDP in Switzerland
  • CPI in Spain
  • Eurozone unemployment rate
  • GDP in the USA
  • New U.S. unemployment claims
  • EIA Crude Oil Inventories
  • Japanese industrial production
  • Chinese manufacturing PMI

GOLD

Specifications

  • Leverage: 100
  • Units: 100
  • Margin requirement: USD$2167
  • Example: movement of USD$10 = $1,000 potential PL.
  • Support 1: 2327.20
  • Support 2: 2323.56
  • Resistance 1: 2335.56
  • Resistance 2: 2340.28

Fundamental Analysis

  • Retail sales in Spain came in at +0.3%, compared to +0.9% in the previous month. German CPI came in at +0.1%, compared to 0.5% in the previous month, indicating a decline, a favorable result for the Eurozone. The gold price is currently correcting -0.16% and is trading at USD 2.334 per troy ounce.
  • The Spanish CPI is expected to increase by 3.7% year-on-year. The Eurozone unemployment rate is expected to rise to 6.5% y/y. U.S. first-quarter GDP is expected to increase 1.6%. New jobless claims are expected to stand at 218,000. Japanese industrial production is expected to increase by 1.5% m-o-m.
  • The gold price is below its 200-day moving average. The price remains in a resistance zone, this time at the USD$2,334 per troy ounce level. RSI and moving averages indicate a massive sell-off. Possible decline towards the USD$2,320 and USD$2,300 support.

EURUSD

Specifications

  • Leverage: 200
  • Units: 100,000
  • Margin requirement: USD$542
  • Example: 100 pips change in EURUSD price = USD1,000 potential PL.
  • Support 1: 1.0794
  • Support 2: 1.0790
  • Resistance 1: 1.0801
  • Resistance 2: 1.0804

Fundamental Analysis

  • Switzerland’s annual GDP is expected to increase by 0.6% year-on-year. The Eurogroup meeting continues today. There is a high probability that the ECB will cut interest rates at its June meeting. For the time being, the EURUSD is stable around the level of 1.0798. Yesterday, the currency corrected -0.51%.
  • Traders are watching the statements of the FOMC and the Fed. For the moment, the stance remains firm: if inflation does not come down, the FED will not start the interest rate cut program.
  • According to the ECB, consumer inflation fell in April, reinforcing the bearish momentum on the continent.
  • EUR/USD has broken above the lower Bollinger band, which could generate a buying move towards the 200-day moving average line. The price remains in a resistance zone, although a fall towards the 1.07600 support level cannot be ruled out. The RSI and moving averages point to a massive sell-off.

DOW JONES

Specifications

  • Leverage: 200
  • Units: 1
  • Margin requirement: USD$195
  • Example: movement of 100 points= $1,000 potential PL.
  • Support 1: 38222.34
  • Support 2: 38204.67
  • Resistance 1: 38264.34
  • Resistance 2: 38288.67

Fundamental Analysis

  • The Dow Jones remains under downward pressure. Yesterday, the index closed with a correction of -1.08%. At the moment, the index is down -0.78% and trades at 38,225 points.
  • Wall Street’s correction is due to the fact that the Fed may not cut interest rates this year, which would keep the cost of capital high for investors.
  • On the other hand, investors continue to buy US Treasury bonds. The 10-year bond yield has risen to +4.7%. On the other hand, traders maintain their interest in Nvidia shares, which are up 21% in a week. Traders are assessing the best time to take profits.
  • During yesterday’s session, the top index gainers were Salesforce +0.66%, Apple +0.16%, and J&J +0.04%. The top correctors were UnitedHealth -3.76%, Intel -2.99%, and Caterpillar -2.41%.

SOURCES

  • Thomson Reuters
  • Market watch
  • Bloomberg
  • Tradingview

 

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