Equities spent Tuesday searching for a direction with two out of three exchanges finishing the day down on exceedingly light trading volume to begin the holiday-shortened week. The market has moved from being oversold, and ripe for a gain, to overbought, and ripe for a correction, in short order. The Dow Jones Industrial Average closed down 12.90 points at 12,596.87. The Standard & Poor’s 500 Index lost 1.79 points to close at 1,337.88, while the Nasdaq Composite Index gained 9.74 points to close at 2,825.77.
If the weekly claims figures are any indication, the jobless rate won’t budge too much and job creation is likely to be on the low side, potentially below the 150,000 needed just to absorb normal population growth. U.S. factory orders rose less-than-expected in May, official data showed on Tuesday. The Commerce Department on Tuesday said orders for U.S. airplanes, cars and other industrial goods rose 0.8% in May, as cash-laden corporations invested in equipment. Optimism about the U.S. economy and the potential for tighter domestic oil regulations also added support to oil.
Crude-oil futures climbed Tuesday to mark their highest closing level in three weeks after a brokerage raised its oil-price targets for next year and forecast continued strong growth in global demand. Crude for August delivery rose by $1.95 to close at $96.89 a barrel on the New York Mercantile Exchange after tapping a high of $97.48. Energy sector gained lift as crude-oil futures closed at a three-week high at $96.89 a barrel and on oil-field-equipment provider National Oilwell Varco Inc.’s acquisition of Ameron International Corp. for about $772 million.
Today’s Important Economic Announcements (GMT)
7:00 AM GBP Halifax HPI m/m
10:00 AM EUR German Factory Orders m/m
12:30 PM CAD Building Permits m/m
2:00 PM USD ISM Non-Manufacturing PMI
11:30 PM NZD GDP q/q
11:50 PM JPY Core Machinery Orders m/m
Forex & Commodities Technical Analysis
The pair has been traveling south in recent days. After Tuesday’s 70-pip move to the downside, USD/CHF is still operating in bearish mode as we near the end of today’s Asian session. At the time of writing, the pair is quoted in the 0.8390 price zone, nearly 15 pips below its starting price. The pair had formed a cycle top at 0.8525 on 4-hour chart, and the fall from 0.8525 extended to 0.8386. Our bearish sentiments are reaffirmed by fundamental market forces. Deeper decline towards 0.8350 previous low could be expected in the next 24 hours.
Stop Loss: 0.8433
Take Profit: 0.8350
Gold price bounced back from its fall on Friday and increased by 2.03% to $1,512. The commodity continues to build on its recovery triggered from the 1,477.85 level rallying strongly higher today and opening the door for further strength. This development has opened the door for more gains towards the 1,524.19 level, its Jun 24’2011 high. A clearance of that level will turn focus to the 1,558.20 level. Gold’s appeal as a safe-haven is on the rise, which means we will likely encounter several bullish trading opportunities today and later this week.
Stop Loss: 1,508.6
Take Profit: 1,524.2
NZD/USD opened the Asian trade at 0.8249 and has launched into the 0.8300 price zone on the back of reports that the New Zealand government deficit is slightly lower than forecast. Net debt as of the end of May, amounted to almost NZD$40 billion, or 20.4% of GDP. That is slightly lower than forecast. At the time of writing, the Kiwi is pressuring up during the Asian trade, last quoted in the 0.8295 area, around 45 pips above its starting price. The recent sideways movement suggests we are likely to hit the bottom end of the channel by the end of the trading day.
Stop Loss: 0.8305
Take Profit: 0.8243
Published by www.SolidityBrokers.com