Earnings reports increasing interest

The USD edged lower yesterday against its counterparts, as market worries for a recession in the US economy remain present and fresh data about the demand side of the US economy are due out today. The drop of the greenback allowed gold’s price to edge higher with the next big test for gold traders being the preliminary US GDP rate for Q1 on Thursday and the negative correlation of the precious metal’s price with the USD being present despite some interruptions. More info on gold is to be released with our Gold weekly report later today. Also, US stock markets seem to remain rather quiet and the tech sector is expected to draw investors’ attention today with Alphabet (#GOOG) and Microsoft (#MSFT) about to release their earnings reports today in the after-market hours. Also, we note the earnings releases of American Airlines (#AAL), General Motors (#GM), McDonald’s (#MCD), 3M (#MMM), Verizon (#VZ), General Electric (#GE), PepsiCo, Xerox, Spotify and finally we note UBS. Given the high number of high-profile companies releasing their earnings reports today, we may see a lot of buzz being created by media headlines generating additional interest in US stock markets.

Oil prices on the other hand edged higher yesterday and during today’s Asian session, as market worries for the demand side of the commodity seem to have eased somewhat. Expectations for increased traveling in the following days, seem to have boosted expectations also for Chinese demand to increase halting the drop of the commodity’s price. Should also the US oil data today and tomorrow show a tight US oil market, oil prices may stabilise if not rise yet such a stabilisation may prove to be short-lived should recession worries re-emerge and there are no news from the supply side of oil.

Back in the FX market, there has been some buzz around the EUR given that Germanys’ Ifo indicators sent mixed signals yesterday and we expect EUR traders to be quite busy this week given especially the high-impact data due out from the area at the end of the week. Also, we note that BoJ Governor Ueda’s comment that the bank is to maintain low rates for now yet also seemed to be hinting that there is a possibility of a rate hike in the future should economic conditions change, a comment that we have not seen coming from a BoJ Governor in a long time, possibly a sign that times they are a changing.

AUD/USD seems to remain in a sideways motion just below the 0.6700 (R1) resistance line. We tend to maintain our bias for the sideways motion for now, yet we also note that the market sentiment is slowly but steadily been turning more bearish for the pair. Should the bears be clearly in control over the pair’s direction, we may see AUD/USD breaking the 0.6630 (S1) support line, which may allow the pair to take aim of the 0.6565 (S2) support level at a future stage. Should on the other hand the bulls take over, we may see the pair breaking the 0.6700 (R1) resistance line and aim for the 0.6760 (R2) resistance level.

GBP/USD edged higher yesterday breaking the 1.2465 (S1) resistance line, now turned to support. Despite cable edging higher the pair’s bullish tendencies seem to remain unconvincing for now, as in the grand scheme of things the sideways motion of the pair remains sideways. The RSI indicator despite at some point nearing the reading of 70, yet corrected lower in today’s Asian session, implying that the bullish effect may be fading away. Also please note that the Bollinger bands remain pretty narrow implying lower volatility, despite some widening since yesterday’s late American session. Should the pair find extensive fresh buying orders along its path, we may see GBP/USD aiming if not breaking the 1.2660 (R1) resistance line. Should a selling interest be expressed by the market we may see the pair breaking the 1.2465 (S1) support line and aim for the 1.2770 (S2) support level. 

Autres faits marquants de la journée :

During today’s European session, we note the release of UK’s CBI indicators for April and Q2. In the American session, we note from the US the release of April’s consumer confidence and the Richmond Composite Index and March’s New Home Sales while oil traders may be more interested in the release of the weekly API crude oil inventories figure.

Graphique de l’GBP/USD H4

Support: 1.2465 (S1), 1.2270 (S2), 1.2115 (S3)

Resistance: 1.2660 (R1), 1.2865 (R2), 1.3070 (R3)

Graphique de l’AUD/USD H4

Support: 0.6630 (S1), 0.6565 (S2), 0.6490 (S3)

Resistance: 0.6700 (R1), 0.6760 (R2), 0.6825 (R3)

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