The US weekly labor data is out!
US Initial jobless claims will be announced on Thursday at 15:30 MT time.
Main market movements on August 26
The stocks rally takes a pause amid the deteriorated sentiment. Let’s discuss what drives the market today.
Fundamentals
- Yesterday the US CB consumer confidence came out worse than analysts expected: 84.8 vs the forecast of 93.0. It is a main measurement of consumer spending, which in turn accounts for the overall economic activity. Therefore, the worse-than-expected consumer confidence signals a slower recovery. Investors were disappointed.
- US new home sales exceeded all estimates. 901 000 homes have been sold in July, while analysts anticipated 787 000.
- Australian completed construction projects came out better than the forecasts. They contracted by 0.7%, while the drop of 6.5% was widely expected. The Australian dollar surged after the report.
- The market awaits Federal Reserve Chair Jerome Powell’s speech on Thursday about the central bank’s monetary policy. Officials assured that the rates won’t be changed for at least two years.
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Technical tips
EUR/USD
If EUR/USD rises above the high of August 24 at 1.1845, it will open doors towards the next resistance of 1.1880. Otherwise, if it tumbles below the key psychological mark of 1.1800, it will dip down to the low of August 21 at 1.1770.
AUD/USD
If the pair moves up the high of August 21 at 0.7210, the way towards the next resistance of 0.7235 will be open. In the opposite scenario, if it falls below the support level of 0.7150, it may plummet to the next one at the low of August 12 at 0.7110. The long term trend is bullish, but risk-off mood may weigh on the aussie in the short term.
S&P 500
S&P 500 takes a breath after reaching a record high yesterday. If it jumps above 3 500, it will open doors towards 3 550. On the flip side, the move below the recent low of 3 430 will drive the price lower to 3 415. Follow the report of US durable goods orders as it will add fresh volatility to the market.
Oil
The WTI oil surged to levels unseen since the early March. Some analysts believe it could be caused by a hurricane in Mexico, which forced oil refineries to shut down and stopped the oil production. If the WTI oil rises above the key pscyhological mark of $45.00, it will soar to the high of March 2 at $47.50. Support levels are at $42.00 and $40.00. Follow the US crude oil inventories report at 17:30 MT time!
Follow further news:
- The US durable goods orders will be out at 15:30 MT time.
- The governor of the Bank of Canada will make a speech at 17:00 MT time.
- US crude oil inventories will be released at 17:30 MT time. Stay tuned!
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The US dollar has broken through the key resistance, it failed to cross since March so far. Riskier assets are dipping. Let’s discuss it in detail.
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