The overall market sentiment is risk-on. The S&P 500 index (US 500) is getting close to the all-time high. Oil is recovering quickly from its recent losses.
Main market drivers on May 21
Let’s start with the stock market. The US-China relationship got worse and set a risk-off market sentiment. The US Senate claimed that it could bar Chinese companies from listing on American exchanges. While President Donald Trump tweeted criticism of China’s handling of the coronavirus outbreak. Everybody took it really seriously. As you can see on the chart S&P 500 has a strong upward trend, but after the swing up yesterday, it hit a 100-day moving average and contracted today. Support levels are at 2815 and 2705. However, if it breaks through the retracement at 2975, it will go up to 3000 and then 3110.
Let’s move on to the oil. May has brought some relief to the oil market. The worst of the demand drop seems to be over. The WTI oil price ticked up to $34 a barrel, while Brent crude rose to $36. Governments are easing lockdowns, and that’s boosting consumption. At the same time, Saudi Arabia, Russia and other OPEC members have started unprecedented oil production cuts, easing the massive oversupply. We haven’t seen such high prices since March 10. If it breaks through the resistance at 35, it may go even further to 37. Support levels are at 27 and 23.
And finally let’s talk about gold. The gold trades at high rates these days. We hadn’t seen any growth yesterday. The price was spiking high, but closed negative. That’s why we could assume that the price will move down in the short term, but the long term remains bullish. It could have a pullback to 1715 or even 1685 and then jump again.
Today traders await the European Central Bank to make a policy statement at 14:45 MT (GMT+3).
Oil dropped to the lows unseen since late May. Bitcoin has dropped below $30,000, while gold has reversed up from a dip under $1,800.
What will happen? The FOMC statement will be published at 21:00 MT (GMT+3) on Wednesday, July 28…
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This week Apple, Microsoft, Google, Facebook, Pfizer, and other large US companies will deliver earnings reports…