Wednesday Market Recap
|Asset||Current Value||Daily Change|
|WTI Crude Oil||44.27||0.07%|
Yesterday’s crazy afternoon, fueled by the newest cyber threat Petya and the plunge in the NASDAQ, is a thing of the past now, as global stocks have rebounded off their lows and trade broadly higher. European shares are still underperforming their global peers, as we expected, and the DAX finally broke below its long-standing trendline possibly pointing to a deeper correction. The Euro is on a rollercoaster ride this week, thanks to the European Central Bank’s summit in Portugal. Just today, the common currency surged to a 12-month high against the US Dollar before collapsing back towards yesterday’s close after another round of speeches regarding the Eurozone’s monetary policies.
EUR/USD 4-Hour Chart Analysis
Apart from the Euro, the Canadian Dollar is the biggest moving fiat currency once again as the rally fueled by the recent positive economic surprises continues in the “Loonie”. Gold is still hovering around the $1250 level after Monday’s suspicious flash crash, and that might be a good sign for the metal, as it failed to gather downside momentum after the dip. Oil is consolidating near the $44 level, as the Saudi-Qatar crisis is on hold for now, with next week’s deadline for the ultimatum slowly approaching.
The crypto-market continues to heal after Monday’s scary dip, and the weakest link of that day, Ethereum, is showing signs of relative strength, as it approaches our target for the bounce at $300. While the long-term picture is getting close to neutral, more corrective action is likely before a move to new highs, although the actual lows are most likely in. Small cap coins are also looking encouraging, while Dash remains the strongest looking major. We still suggest tracking the moves of Ethereum and Bitcoin as correlations could still jump in the case of another dip, as the correction phase runs its course.
Ethereum, 4-Hour Chart Analysis
The DAX broke below the crucial support level that we pointed out recently and exited the long-term trend channel with the overnight dip. A test of the zone between 12,375 to 12,500 is the most likely scenario, and bulls should still wait before opening new positions in the benchmark. Yesterday’s strong decline in the NASDAQ could point to a broad correction in global stocks, and the strength of the Euro could further weigh on European equities.
DAX Index 4-Hour Chart Analysis
Key Economic Releases on Wednesday
|10:00||EUROZONE||M3 Money Supply||5.0%||5.0%||4.9%|
|14:30||US||Goods Trade Balance||-65.9 bill||-66.2 bill||-67.1 bill|
|15:00||US||Pending Home Sales||–||0.9%||-1.3%|
|16:30||US||Crude Oil Inventories||–||-2.1 mill||-2.5 mill|
Key Economic Releases on Thursday
|15:00||US||Initial Jobless Claims||240,000||241,000|
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