The U.S. dollar was seen trading steady despite posting losses on Thursday. News about a possible delay to tariffs on Mexico helped to boost investor sentiment modestly. On the economic front, the U.S. trade deficit rose to $50.8 billion in April. Meanwhile, President Trump once again threatened China with tariffs on an additional $300 billion worth of goods if necessary.
Test your strategy on how the US dollar index will fare with Orbex - Open your account now. |
Euro Gains as ECB Signals Rates to Remain Lower for Longer
The European Central Bank held its monetary policy meeting yesterday. As widely expected, the central bank said that interest rates would remain low well into 2020. However, the central bank also said that rates could be lowered even more if required. The comments come in the backdrop of the recent inflation report which saw consumer prices easing back stronger than expected.
EURUSD Closes Above 1.1250
The EURUSD currency pair was seen trading volatile on Thursday. But price managed to close on a bullish note above the 1.1250 handle on a daily basis. The current retracement from the highs could see the common currency testing the support at 1.1250. As long as this support holds, the currency pair could be eyeing further gains. The price will need to clear the initial highs at 1.1292 followed by a move to 1.1319.
Crude Oil Rebounds Modestly
WTI Crude oil prices posted a modest rebound from the recent lows as price is seen potentially forming a temporary bottom. The rebound in oil prices comes amid rising supply and weak global demand. Japan’s prime minister Abe is in Tehran to help resolve the stand-off between Iran and the U.S.
Is Crude Oil Posting a Dead Cat Bounce?
The rebound off the recent lows in crude oil has helped to push price only slightly higher. Price is seen trading near the 53.44 level which previously saw some consolidation. As long as this level holds, oil prices could remain range bound with the bias to the downside. The Stochastics oscillator is also showing a hidden bearish divergence which could indicate a potential downside. The lower support at $50.00 remains the downside target.
Gold Consolidates Ahead of the Payrolls Report
Gold continued to post gains on Thursday but the pace of gains look to be slower than the previous sessions. Perched near a four-month high, the precious metal awaits further clues from today’s payrolls report. Given the recent weak patch of jobs report from ADP, the prospects of a lower than forecast payrolls could give gold a boost.
Gold Forms a Minor Double Top
Gold prices were seen consolidating near the top end of the rally. Price action formed a minor double top pattern near 1337.75. If this double top pattern holds, then we could expect some downside. The lower support at 1320.80 remains the main target to the downside with further declines likely. The unfilled gap from earlier this week at 1305.37 will be the initial target.
