Forex news for close trading on May 14, 2020
An overview of the other markets of the day shows:
- Gold spot, plus $ 15.12 or 0.88% to $ 1,731.36. The price rose above a higher trend line on the daily chart at $ 1,722 and this breakout triggered more purchases in the precious metal. The high price extended to $ 1,736.55.
- WTI crude oil futures in June rose $ 2.45 to 19.79% to $ 27.74. The July contract also jumped with a gain of $ 2.39 19.31% to $ 28.07
The big event today was the first unemployment claims. A total of 2,981 million additional workers were added to unemployment. Since mid-March, 36.5 million Americans have had to quit their jobs. Continuing claims amounted to 22,833 million. It was actually better than expected at 25,120K.
The data INITIAL sent US stocks down. The main indices opened lower but traded in a very volatile trading range from top to bottom for most of the trading day. However, dips continued to buy and a rally late in the day helped close each of the main higher indexes, led by the Dow 30 which rose 1.62% on the day.
The latest figures show:
- The S & P index, +32.5 points or 1.15% to 2,852.50
- The NASDAQ index closed up 80,556 points or 0.91% to 8,943.72.
- the Dow Jones industrial average rose 377.37 points or 1.62% to 23,625.34
European indices did not benefit from purchases at the end of the day on the American market. All major indices closed with a sharp drop led by the UK FTSE which fell -2.75%.
Saw yields in the US debt market move lower with the flattening of the yield curve. The 2-year yield fell by -0.8 basis points, but the 30-year bond fell by -4.6 basis points.
The difference from 2 to 10 years shrank to 47.56 basis points from 49.36 basis points at the end of yesterday’s trading session.
In Canada, the Bank of Canada Poloz – in one of its functions as governor of the central bank – presented the results of the financial system review. His comments were more optimistic than perhaps the expected market, and that helped propel the CAD to the strongest of today’s major currencies.
At the other extreme, the JPY. He was the weakest of the majors. The USD is in the middle of the range with mixed results. The greenback rose against the EUR, JPY and CHF, fell against the CAD, AUD and NZD, and was unchanged against the GBP.
Some technical comments before the new day:
- USDCAD: The loonie was not only the strongest (USDCAD lower), it closed at the lowest of the day. The low price has just reached the 1.4031 level. The level also happens to be when the 100 hours in motion rests medium. Just above, the 50% retracement of the May trading range at 1.40355. Just above this level, since the 200-hour moving average of the pairs is 1.40384. In the new trading day, this area between 1.4031 and 1.4038 will help define the bias in the future. Move below and the bias is more negative, move above and the bias tilts more upwards
- EURUSD: EURUSD had a top-down trading session at trading hours in New York. The bottom of the first session fell below the intermediate support from 1.0777 to 1.0771, but the sales momentum could not be maintained. The rally’s return to the upside on the stock market at 1.0815 which is the top of a swing area between 1.0808 and 1.0815. The price then dropped to 1.0777 to find buyers again. The pair just closes around the 1.0800 level. So open volatility with a wide range between 1.0777 and 1.0815. On the new day, a break outside the beach will help determine the pair’s next bias
- USDCHF: The USDCHF gave dip buyers a chance to buy low when it fell to test its 100 and 200 hour moving averages at 0.9712. Risk-based traders relied on the two moving averages and pushed the price up. The pair ends at 0.9732. In the new trading day, moving averages remain the level determining the risk for the pair. Stay above (they are currently around the 0.9714 level) and buyers remain in control. Move below and Wrestle back sellers to control long positions.
- USDJPY: The USDJPY pair between the 200 hour moving average below (currently at 106.79) and the 100 hour moving average above (currently at 107.158) during the morning session in New York. In the afternoon of New York, the price could exceed its moving average of 100 hours and stay above. The high price lengthened to 107.36 before falling back at the end of the session. During the new trading day, staying above its 100 hours of MA will be the level of risk and bias that will define traders. Staying above is more bullish. Moving below is more bearish.