Correction sentiment squeezed markets. Bitcoin has lost more than a
third of its value in the last two weeks, crude prices lost 5%, U.S. stock
market was close to a full-scale correction while the Dollar tried to return to
the upside movement.
Most interesting is that Fed’s intensions are becoming clearer. Fed’s
solid position of maintaining ultra-soft monetary policy was challenged by some
FOMC members that called the Fed to reconsider its current policy towards
tapering extraordinary measures in the future.
The behavior of the Fed seemed to be very strange, as it has not
mentioned such alternative opinion in it statement after the meeting in April.
It seems the Fed is running out of time as the correlation between Bitcoin and
the S&P broad market index points towards deep correction of the U.S. stock
market in the coming days.
Friday’s large portion of the PMI data for the G7 countries may,
however, present a brighter picture. But evet the latest figures for continuing
jobless claims in the United States jumped suddenly to 3.751 million vs 3.64
million expected. That may underpin negative trends in the world’s largest
economy. It also means that buying U.S. stock market is not the case now. But
we should also wait for S&P 500 index to slip below 4040 points to open
sell positions. But before that, it would be wise to stay off the market.
Crude market has suffered a short correction after Brent prices hit
$70.10 a barrel level, and report of a significant progress in U.S.-Iran
negotiations over the nuclear deal. Brent crude prices plunged to $65 a barrel
triggering a bearish scenario with targets at $64.00 a barrel. However, sell
positions would be interesting if the price returns to $67.70 level.
Gold prices are suffering high volatility. Despite surging U.S. 10-year
Treasuries yields to 1.69%, prices remain above $1870 per ounce on geopolitical
tensions. So, it would be wise to leave the gold market and seek for a possible
positions next week after Israeli-Palestinian conflict showed some new
developments.
The
Greenback is falling further with some attempt of correction in the middle of
this week. The EURUSD is still gravitating to 1.21850, and would hardly make an
upside jump this week. We cannot exclude it may also dive to 1.2050 following
the developments in the U.S stock market.
The GBPUSD
has failed to leave the orbit of the strong support level at 1.40900. Despite
its formal achievements above 1.41600 it would hardly continue its rally
towards 1.43600 this week.
The
USDJPY was testing 108.70 level several times, but failed to go down. It would
likely to be squeezed today between the support at 108.70 and the resistance at
109.40.