US jobless claims of 419,000 showed surprise gain, beating the expectations of 350,000

23 July 2021, 06:19

Market Focus

US markets were led by tech stocks to the third straight day of gains even though an unexpected jump in jobless claims showed some concerns about the economy. Overall, the Dow Jones Industrial Average rose 25.35 points and the S&P 500 climbed 0.2% higher. In the meantime, the Nasdaq 100 gained 0.3%, closing with 14685.60. Investors are continuing to be optimistic as corporate revenue and profits are increasing sharply, leading the economy and the indices to rebound.

US jobless claims of 419,000 showed surprise gain, beating the expectations of 350,000. However, on the positive side, continuing jobless claims declined by 29,000 to 3.24 million, a fresh low since the pandemic happened.

Chinese regulators are being serious about companies that are going to IPO overseas. China has weighted an unprecedented penalty on Didi Global Inc. after its controversial IPO last month. China is considering imposing harsh penalties from a massive fine to even a forced delisting. As a result, shares of Didi plummeted more than 10%, bringing it to 27% losses cumulatively.

Main Pairs Movement

EURUSD traded in the red and at weekly lows, ending with 1.17704. The ECB announced that it will leave rates and the facilities unchanged; the announcement was considered a disappointment as the so-awaited forward guidance was vague.

GBPUSD climbed toward 1.3839 resistance confluence as the BOE is optimistic about inflation. The BOE sees a good case of inflation rise, saying that is temporary.

Bitcoin hovered around 32,000 after Elon Musk and Cathie Wood re- discussed Bitcoin on panel. Specifically, Cathie Wood mentioned that corporations should consider adding Bitcoin to their balance sheets.

Technical Analysis

GBPUSD (4-hour Chart)

Sterling has led gains among in G10 currencies peers, rose 0.4% to 1.3773 as of writing. In the meantime, the greenback faced additional stress from an unexpected increase in U.S. jobless claims and weaker than expected Chicago Fed National Activity Index for June.

For the technical aspect, the RSI indicator closes around 60 figures which suggest a cogent bull guideline for at least the short term. For moving average side, 15 long SMA indicator strong jumped up to ascending momentum while 60 long SMA indicator remaining a slight upside but seems flat movement.

Overall, we witness the sterling has rebounded as a “V shape” movement already in recently which is all supported by buy-in momentum and market eye-catching, even Kingdom was squirming in variant worried in early this week though. As current price action, we foresee the market will high probably continue to advance to higher stair, but still need to consider whether market impetus could constantly ante buy-side momentum or RSI indictor will rapidly head to overbought territory.

Resistance: 1.3896

Support: 1.36, 1.3665, 1.3745

AUDUSD (4- Hour Chart)

Aussie settles at 0.738 around as of writing which led by diminished dollar’s demand despite tepid Australian data. Other than this, the copper and oil market successive creep up from depression plummets in earlier this week. Meanwhile, 10 year U.S. Treasuries yields fell from nearly 2 rebound market movements, drop 1.71% to 1.268%, shows a market in reposition to a risk-on mode that thrived commodities-linked peers as well.

From the technical perspective, the RSI indicator gradually ratchets up to 54 figures since at the lowest price level, suggesting a benign bull momentum. For moving average side, 15 long SMA indicator has turn north way and 60 long SMA remained descending slope as of writing. On the downside, we still believe 0.73 is compelling support. On the up way, we expect 0.7415 would be a stressful resistance as a neckline in light of the price pattern.

Resistance: 0.7415, 0.7492

Support: 0.7323, 0.73

EURUSD (4- Hour Chart)

Euro fiber went south 0.14% to 1.1774 which jumped as much as 0.3% 1.183 after ECB revised its guidance on when interest rate might rise to convince investors it won’t revoke support easing program on monetary policy too hastily then pose to derail the economic revival. Base on price action, the euro seems to struggle in a tiny consolidation range in recent, losing attraction and volatility as well.

For the technical side, the RSI indicator set 43 figures that feeling suggesting slightly bearish guidance for the short term. From a moving average perspective, 15 long SMA indicators moving along with the price close to a slight downward movement and 60 long SMA cater to sputter movement.

Following the recent suggestion, we deem the market is rejuvenating to the upper stage if the market could exceed the first resistance at 1.1804 around. Moreover, if the price could propel to higher than the next price level would eye on 1.1848~1.188. In contrast, if the price penetrates the first immediate support level that is also close to the current price level, it could be toward 1.17 as our perspective.

Resistance: 1.1804, 1.1848, 1.188

Support: 1.1766, 1.17