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Market Analysis

Home » Latest News » Daily Report on May 30, 2016

Daily Report on May 30, 2016

Posted by Option_Banque in Latest News - May 31st, 2016 2:38 am GMT

The U.S Commerce Department reported on Friday that the US economy grew at a faster pace than the initial estimate, in the first quarter of 2016. However, the overall growth rate is still fairly sluggish. The gross domestic product last quarter grew by 0.8% on a year-on-year basis, well above the 0.5% forecast.
The greenback today is on an up-move in thin holiday trading, after FED Chair Yellen commented on May 27 that the central bank is considering raising the overnight interest rate from the range of in the coming months if the economy shows positive signals of a strong recovery.
Earlier today, data from Germany on German import prices for April, came in with a decrease of 6.6% from one year earlier. After excluding crude oil and mineral oil products, the index declined 4.0% in comparison with the level in 2015.
The KOF Economic Barometer for May was released early this morning, meeting the expected reading of 102.9 points, extending its solid uptrend since February. The latest reading indicates positive growth expectations for the Swiss economy in the coming months.
In Japan, weak retail sales data for April is supposed to be the main reason that Japan’s Prime Minister Abe planned to delay the nationwide sales tax increase by two and a half years. For the last month, turnovers from retailers dropped 0.8% from one year earlier. This was also the fastest decline in over 12 months.
Today, oil prices are moving down on a rising dollar and concerns that Canada’s output may be restored back to normal this week. WTI crude oil dipped to $49.32/barrel, 0.8% lower than the last close.

Technicals

EURUSD

Fig. EURUSD H4 Technical Chart
The Stochastics chart shows that the pair EURUSD has been in the oversold territory since a while, and the %K line (blue line) has already penetrated the %D line (red line), hinting a reversal. After testing a record low of 1.10966 since March 16, EURUSD is heading up slightly. However, this seems to be a short corrective bounce, before the pair resumes its fall. A short position is encouraged.
Trade suggestion
Buy One Touch Call Option at 1.11676 valid until May 30, 2016
Buy One Touch Put Option at 1.10959 valid until May 30, 2016

GBPJPY

Fig. GBPJPY H4 Technical Chart
The yen is on track to weaken against the sterling after the pair reached the support of 160.115 last Friday. The two moving averages moving under the price chart, are giving the pair support to surge higher. ADX (14) points up to 25.0641, confirming this uptick. The signal trend indicator has formed a green arrow under the price chart since May 25, suggesting a long position.
Trade suggestion
Buy One Touch Call Option at 162.577 valid until May 30, 2016
Buy One Touch Put Option at 162.316 valid until May 30, 2016

USDCAD

Fig. USDCAD H4 Technical Chart
The pair USDCAD has been flying high in overbought territory for a period of time. There are no signals of a reversal yet, as the %K line (blue line) is still heading upwards, well above the %D line (red line). The current uptrend is maintaining its strength as the RSI (14) has advanced to the average level. USDCAD is expected to keep gaining momentum until it hits the resistance of 1.31738 before falling back in the long-term as hinting by a red arrow above the price chart.
Trade suggestion
Buy One Touch Call Option at 1.30763 valid until May 30, 2016
Buy One Touch Put Option at 1.30464 valid until May 30, 2016

GOLD

Fig. GOLD H4 Technical Chart
GOLD is currently tiptoeing around the reading of 1203.00 after plummeting sharply from the resistance of 1288.30 formed on May 16. The stochastics chart shows that the precious metal has entered the oversold territory. The signal trend indicator has suggested a short position since May 18, with a significant move of 7038 points thus far. Hence, the price could possibly reverse into an uptrend.
Trade suggestion
Buy One Touch Call Option at 1208.96 valid until May 30, 2016
Buy One Touch Put Option at 1204.90 valid until May 30, 2016

COPPER

Fig. COPPER H4 Technical Chart
RSI (14) has fallen to 49.0111, confirming a strengthening bear. COPPER prices are forming a double top pattern with the price entering the down wave that would complete and confirm this formation. Although a long position is signaled by the green arrow currently under the price, the metal is much more likely to keep plummeting to retest the support at 2.05000.
Trade suggestion
Buy One Touch Call Option at 2.1200 valid until May 30, 2016
Buy One Touch Put Option at 2.0500 valid until May 30, 2016

SP500

Fig. SP500 H4 Technical Chart
SP500 opened today’s trading session with a wide gap-up, surging as high as 2104.24 and is now pulling back to cover the gap in thin holiday trading. RSI (14) stands at 74.6345, implying that the index is approaching overbought territory. The price may reverse back into a down-move. The key support to watch is 2086.30.
Trade suggestion
Buy One Touch Call Option at 2103.28 valid until May 30, 2016
Buy One Touch Put Option at 2098.77 valid until May 30, 2016

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