USD Strong Against Major Currencies, EUR/USD Posts Sharp Drop
iFOREX | Jul 01, 2015 05:29AM ET
The dollar remained stronger against most major currencies on Tuesday, after data showed that U.S. consumer confidence improved more than expected in June and as concerns for a Greek default continues to provide support to safe-haven demand. The Conference Board reported on Tuesday that consumer confidence rose to 101.4 this month from 94.6 in May, when analysts expected a rise to 97.3 in June. Elsewhere, Eurozone data showed that the euro zone's consumer price inflation rose by 0.2% this month, meeting forecasts while unemployment was at 11.1% in May, the lowest level since March 2012. Mr. Gerry Rice, Director of Communications at the IMF, made the following statement today regarding Greece's financial obligations to the IMF due today: "I confirm that the 1.2 billion repayment due by Greece to the IMF today has not been received. We have informed our Executive Board that Greece is now in arrears and can only receive IMF financing once the arrears are cleared. I can also confirm that the IMF received a request today from the Greek authorities for an extension of Greece's repayment obligation that fell due today, which will go to the IMF's Executive Board in due course.". For today, the U.S. is to release a report on ADP nonfarm payrolls and later in the day the Institute of Supply Management is to release data on manufacturing activity.
EUR/USD
The EUR/USD posted a sharp drop on Tuesday, after recovering by more than 2% on Monday as Greece remain on track towards a default. An emergency conference call between Greece and its international creditors ended once more without a deal on Tuesday and as result, Greece's second bailout since 2010, expired as expected. Separately, Greece failed to repay the amount owed to the IMF, before Tuesday's deadline losing financial aid from the IMF. The pair was also pressured by data from the U.S showing that U.S. consumer confidence improved to 101.4 this month from 94.6 in May, when analysts expected a rise to 97.3 in June. Elsewhere, Eurozone data showed that the euro zone's consumer price inflation rose by 0.2% this month, meeting forecasts while unemployment was at 11.1% in May, the lowest level since March 2012. For today, the U.S. is to release a report on ADP nonfarm payrolls and later in the day the Institute of Supply Management is to release data on manufacturing activity.
Pivot: 1.121
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Support: 1.106; 1.1; 1.095
Resistance: 1.121; 1.128; 1.135
Scenario 1: Short positions below 1.121 with targets @ 1.106 & 1.1 in extension.
Scenario 2: Above 1.121 look for further upside with 1.128 & 1.135 as targets.
Comment: The RSI lacks upward momentum.
OIL
Crude oil prices recovered on Tuesday, ending the day just above $59 still finishing the month slightly lower, after opening the month above $60 a barrel. The fuel is trading on negative territory on Wednesday after weak U.S. industry data on stockpiles and after lower than expected manufacturing data from China pointing to a further decline in the health of the manufacturing sector. Earlier, the American Petroleum Institute said that U.S. crude stocks jumped 1.875 million barrels last week adding further pressure on prices. For today, market focus is shifted towards inventories from the U.S. Department of Energy while talks with Iran have been extended beyond Tuesday's deadline by seven days to July 7.
Pivot: 57.95
Support: 57.95; 56.85; 55.7
Resistance: 60; 60.82; 61.57
Scenario 1: Long positions above 57.95 with targets @ 60 & 60.82 in extension.
Scenario 2: Below 57.95 look for further downside with 56.85 & 55.7 as targets.
Comment: The next resistances are at 60 and then at 60.82.
S&P 500
The main U.S. stock indices fluctuated between gains and losses ending the day almost unchanged on Tuesday after a sharp drop posted the previous day, as Greece remains on track towards a default while negotiations between Greece and its creditors as well as Iranian Nuclear talks are showing that they will more likely continue next week. The S&P posted a slight rise as eight of 10 sectors closed in the green. Stocks in the Energy, Health Care and Financials sectors were leading the way while Telecommunications and Utilities Stocks lagged. The top performer on the S&P was Pentair, which gained by almost 6.70%. For today, the U.S. is to release a report on ADP nonfarm payrolls and later in the day the Institute of Supply Management is to release data on manufacturing activity.
Pivot: 2135
Support: 2038; 2006; 1972
Resistance: 2135; 2180; 2215
Scenario 1: Short positions below 2135 with targets @ 2038 & 2006 in extension.
Scenario 2: Above 2135 look for further upside with 2180 & 2215 as targets.
Comment: The RSI is capped by a bearish trend line. The index has penetrated its bullish channel in progress since March 2015
Shares in Twitter (NYSE:TWTR) Inc gained by almost 6% on Tuesday ending the day at 36.3, after rumors resurfaced that the social networking giant could consider a merger with a larger tech company, according to Barron's. Twitter has encountered strong pressures in recent weeks droppping from levels above $50 after CEO Dick Costolo announced his resignation earlier this month.
Pivot: 33.4
Support: 33.8; 33.4; 32.3
Resistance: 36.4; 37.1; 37.8
Scenario 1 : short term rebound towards 37.1.
Scenario 2: below 33.4, expect 32.3 and 31.6.
Comment: the RSI is below 50. The MACD is negative and above its signal line. The configuration is mixed. Moreover, the stock is trading under both its 20 and 50 day MA (respectively at 35.63 and 38.42). Twitter is currently trading near its 52 week low at 33.51 reached on 16/06/15.
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