IForex Daily : May 11, 2014
iFOREX | May 11, 2015 05:14AM ET
The dollar advanced on Friday against most major currencies, after data showed that the U.S. economy created slightly less jobs than expected last month, while unemployment declined in line with market expectations. The Department of Labor said that the U.S. economy added 223,000 jobs last month, below expectations for a 224,000 rise. The number of jobs added in March was revised to 85,000 from a previously estimated 126,000. The U.S unemployment rate dropped to 5.4% in April from 5.5%, as expected. In the U.K, the pound reached two-and-a-half month highs after the Conservatives won more than half the seats in the Parliament on Thursday, allowing David Cameron to end a coalition with the Liberal Democrats. The Reserve Bank of Australia's stated in it's monthly policy statement that it is open to further interest rate cuts as Chinese growth is slowing and business investment is weak in in Australia. In Japan, the most central bank board members voted in favor of continuing the bank's aggressive asset-buying program. In the week ahead investors will be turning their attention to U.S. data on retail sales and consumer sentiment for fresh indications on the strength of the economic recovery. The euro zone is to release preliminary estimates on first quarter growth on Wednesday
EUR/USD
The euro fell against the dollar on Friday after the latest U.S. Non-Farm Payrolls report came in just below expectations, while the unemployment rate dropped to the lowest since May 2008 as expected, giving positive growth signals for the U.S economy. In addition, March's payrolls report was revised to show that only 85,000 jobs were created, the fewest since June 2012. The Fed will continue to watch closely on the labor market as it considers when to start raising interest rates, which have been close to zero since December 2008. In the week ahead investors will be turning their attention to U.S. data on retail sales and consumer sentiment for fresh indications on the strength of the economic recovery. The euro zone is to release preliminary estimates on first quarter growth on Wednesday.
1.1245
Support1.111
1.1065
1.101
Resistance1.1245
1.1285
1.1325
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Scenario 1: Short positions below 1.1245 with targets @ 1.111 & 1.1065 in extension.Scenario 2: Above 1.1245 look for further upside with 1.1285 & 1.1325 as targets.Comment: The RSI is mixed to bearish..
XAU/USD
Gold prices ended slightly higher on Friday, despite the positive jobs data from the U.S as investors shifted their attention in China for further demand indications from one of the world's biggest buyers. On Sunday, the People's Bank of China cut its benchmark interest rate by a quarter percentage point to 5.10% from 5.35%, in order to spur economic activity and boost growth. China also reported that exports slumped 6.4% from a year earlier. In the week ahead, investors will be focusing on Wednesday's U.S. retail sales report for April, for fresh indications on the strength of the economy and the timing of a U.S. rate increase.
1194
Support1178.6
1169.5
1160
Resistance1194
1197.5
1200
Scenario 1: Short positions below 1194 with targets @ 1178.6 & 1169.5 in extension.Scenario 2: Above 1194 look for further upside with 1197.5 & 1200 as targets.Comment: As long as 1194 is resistance, likely decline to 1178.6.
OIL/USD
Crude oil prices were little changed on Monday as moves by China to support its economy failed to create confidence that oil demand in the world's largest energy consumer will improve. China cut interest rates for the third time in six months to prevent further slowdown in its economy, which is headed for its worst year in 25 years. Data on Friday showing high imports and low exports by China in April did not support oil prices, either. For the week ahead, investors will be focusing on Tuesday's industrial inventory data and on Wednesday's government data from the EIA for further indications on supply.
59.7
Support58.15
57.3
56.55
Resistance59.7
60.5
61.3
Scenario 1: Short positions below 59.7 with targets @ 58.15 & 57.3 in extension.Scenario 2: Above 59.7 look for further upside with 60.5 & 61.3 as targets.Comment: As long as 59.7 is resistance, likely decline to 58.15.
DOW JONES
U.S. stock indexes ended more than 1 percent higher on Friday after strong jobs data indicated U.S. economic growth was picking up momentum, but not enough to raise concerns about an earlier-than-expected interest-rate rise by the Federal Reserve. Labor expenses will be of high importance in the coming weeks, with many companies under pressure to boost workers' wages. Wal-Mart (NYSE:WMT), Target Corp (NYSE:TGT), Gap, and McDonald's Corp have already announced wage increases, and the trend appears to be spreading further into the retail and restaurant sectors. In the week ahead, investors will be focusing on Wednesday's U.S. retail sales report for April, for fresh indications on the strength of the economy and the timing of a U.S. rate increase.
17585
Support17585
17040
16330
Resistance18290
18900
19200
Scenario 1: Long positions above 17585 with targets @ 18290 & 18900 in extension.Scenario 2: Below 17585 look for further downside with 17040 & 16330 as targets.Comment: Even though a continuation of the consolidation cannot be ruled out, its extent should be limited.
MCDONALDS
McDonald's Corporation (NYSE:MCD) MCD declared its global sales for April earlier on Friday, which were much better than analysts' expectations. While a decline of 1.8 percent was expected, the company reported a decline of just 0.6 percent pushing the stock higher by more than 1%. In addition, comments from CNBC's Jim Cramer stating why McDonald's is currently the best stock to buy in the Dow added further support in prices. On a global scale, McDonald's sales fell 0.6% last month, fueled by its Asia/Pacific, Middle East and Africa regions.
94.5
Support94.5
91.5
86.75
Resistance101.1
104
107.5
Scenario 1: Long positions above 94.5 with targets @ 101.1 & 104 in extension.Scenario 2: Below 94.5 look for further downside with 91.5 & 86.75 as targets.Comment: The RSI lacks downward momentum.
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