The market takes breath after the long rally. What opportunities do traders have today?
How to trade on June 26?
- The market sentiment is mixed. Yesterday unemployment claims in the USA came worse than analysts expected. Almost 1.5 million Americans lost their jobs last week. That was the signal that the US labor market is still struggling from the coronavirus damage even with the economy reopening. In total, 47 million people were fired during the coronavirus pandemic, it’s higher by 10 million than during the Great Recession.
- US states such as Florida and Texas recorded new coronavirus outbreaks. Localized restrictions have been imposed in Portugal, Germany, Australia and China.
Nevertheless, stocks gained slightly yesterday. Investors stay optimistic because they believe that the second wave will be offset by the additional stimulus measures from the government. The tug of war between bulls and bears this week sent the S&P 500 from side to side, with yesterday’s gains leaving it flat. The move below the strong support at the 200-day moving average at 3020 will push the price even deeper to the key psychological mark at 3000. Otherwise, if bulls get stronger, the S&P 500 may climb to the resistance at 3110, that it has touched already several times. Analysts expect some payback for stocks and riskier currencies in July after such a great rally for three straight months.
EUR/USD's daily chart shows a golden cross of the 50- and 200-day moving averages, a long-term bull market indicator. However, bulls don’t rush to move on because this signal is quite weak as the price surged much higher from moving averages. The break above the high of June 22 at 1.1260 will push prices up. Otherwise, if the pair crosses the support at the low of June 19 at 1.1170, prices may fall further.
Let’s move on to gold. XAU/USD contracted slightly yesterday. However, analysts highly anticipate the break above $1,800 amid the broad pessimism. Support levels are at $1,720 and $1,700.
Finally, let’s talk about oil a bit. Oil prices rose after Russia cut exports of its crude Urals to the lowest in at least 10 years. If the Brent oil price manages to close above the $45 level, it will push prices up. Support levels are $39 and $36.
Follow US reports of personal spending and consumer sentiment at 15:30 MT time today.
To trade Brent with FBS you need to choose BRN-20N.
The United States will publish a weekly update on unemployment claims on July 9, at 15:30 MT time.
The market sentiment deteriorated amid increasing virus cases in the USA and Australia. Investors prefer safe-haven assets like gold, the US dollar and the Japanese yen.
Riskier currencies and stocks are in favor of investors. Surprisingly, gold rallies too. Let’s have a closer look.
Congratulations! Gold has just opened a new era... or, rather, reopened...
Canada will publish the employment change and the unemployment rate on July 10, at 15:30 MT time.