US Market Wrap
Markets ended the week with concerns around the war of words that is growing between the US and China.
Despite the fact, the SPX closed out the week marginally in the green, many investors are clearly worried that we are looking at another flare-up in the trade wars between the two powerhouse economies of the world.
Last week, President Trump continued his strong condemnation of China’s role in the COVID-19 outbreak and that was followed up by proposed restrictions on Chinese companies listed on US exchanges.
China made a power play of its own, proposing new legislation for Hong Kong, that would take back control – in a move that further upset the US. Forcing them to reconsider Hong Kong’s special trade status, according to US Secretary of State Michael Pompeo.
So the week is likely going to be dominated by more back and forth between the two countries.
The Data Agenda
There will be a bit of data to keep an eye out for, but Monday might be quiet from the US thanks to the Memorial Day weekend.
Over the next five days, we will be watching out for the usual jobless data on Thursday from the US to see if there are any signs of a recovery. While Fed boss Jerome Powell will be doing a webcast mid-week and releasing a host of economic data. We heard a fair bit from him and the Fed last week, so this won’t be as market-moving I would say.
In Europe, we have a fair bit of data that will be rolling out, highlighted by German IFO data today and inflation numbers later in the week.
At the same time, the European Commission will release its pandemic recovery plan, which has the potential to be a market mover for the EUR/USD.
While European Central Bank President Lagarde is also due to speak later in the week, but expect the messaging to remain the same.
Forex Signal Update
The FX Leaders Team finished with 11 wins from 19 trades for a 58% strike rate on the week closing with a run of 10 out of 11 in the final few sessions.
Make sure you follow our live signals as we will be actively looking for more opportunities early in the week.
NZD/USD – Active Signal
The NZD/USD along with the other key risk-on assets have been quite bullish. So far the Kiwi hasn’t been able to break out above this key resistance level, but we are thinking there is a good chance it will happen.
Gold – Pending Signal
GOLD has been consolidating recently, but the chart remains bullish. We are still hunting long opportunities here as price looks ready to try to push higher again.
Last week I said BTC was at an inflection point and sure enough the $10,000 level held up once again.
Not only that, price has dropped through $9,000 and the sellers are piling in. Continually we see the big money liquidating at $10,000. That has to tell us something about its perceived value.