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Daily Analysis: Gold Tops $1300 on Mixed US Numbers

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Friday Market Recap

Asset Current Value Daily Change
S&P 500 2453 0.13%
DAX 12991 0.07%
WTI Crude Oil 51.05 0.85%
GOLD 1304.00 0.58%
Bitcoin 5712 7.49%
EUR/USD 1.1813 -0.15%

The eagerly awaited Retail Sales and CPI reports came out today, and the US economy delivered a mixed bag, with inflation lagging expectations but core retail sales beating the consensus estimate. The market clearly focused on the CPI miss, as Treasuries rallied, rate hike expectations plummeted, the Volatility Index (VIX) hit another record low, and gold continued its rally. The precious metal is headed to the weekend above the $1300 level again, with the long-term uptrend remaining dominant, despite the widespread bullish trend in risk assets.

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Equities remained very quiet, at least in the US, with the major indices drifting sideways all day long, with a slight bullish bias thanks to the outperforming Nasdaq. The Japanese market continued its rally, with the Nikkei gaining 1% and hitting yet another two-decade high in the process. Europe remained inside a very narrow trading range, with the DAX and the EuroStoxx 50 both being only a tad below their recent highs.

DAX, 4-Hour Chart Analysis

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Currency markets settled down after the previous hectic sessions, but the rally continued down under, with the Aussie and the Kiwi adding to their recent gains. The Yen also continued to drift higher, and the Pound outperformed both the USD and the Euro in the choppy environment. Oil, especially the Brent contract, bounced back after yesterday’s decline, as the Iraqi-Kurdish standoff near Kirkuk made energy investors nervous.

AUD/USD, 4-Hour Chart Analysis

Cryptocurrencies

Bitcoin continued its explosive break-out move today, setting the tone for the whole segment, but Ethereum, Monero, and Litecoin also joined the rally with near double-digit gains. The price of the ETH token got a boost from the progress of the Byzantium upgrade, while LTC and XMR likely concluded their deep corrections and could be resuming their uptrends, with Dash also flexing its muscles near the $300 level. Ripple is still trading in its short-term consolidation pattern while NEO and IOTA are lagging the other majors and ETC struggling with the $12.50 level ahead of another possibly busy weekend for the segment.

ETH/USD, 4-Hour Chart Analysis

Key Economic Releases on Friday

Time, CET Country Release Actual Expected Previous
2:30 AUSTRALIA RBA Stability Report
Tent. CHINA Trade Balance 193 bill 266 bill 287 bill
14:30 US Retail Sales 1.6% 1.5% -0.2%
14:30 US CPI 0.5% 0.6% 0.4%
16:00 US UOM Consumer Confidence 101.1 95.4 95.1

Key Economic Releases on Monday

Time, CET Country Release Expected Previous
3:30 CHINA CPI 1.6% 1.8%
3:30 CHINA PPI 6.3% 6.3%
14:30 US Empire Manufacturing Index 20.3 24.4

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Analysis

Daily Analysis: Stocks Turn Lower as Kiwi Collapses after Coalition Agreement

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Thursday Market Recap

Asset Current Value Daily Change
S&P 500 2558 -0.09%
DAX 12990 -0.41%
WTI Crude Oil 51.37 -1.39%
GOLD 1289.00 0.43%
Bitcoin 4258 -0.89%
EUR/USD 1.1829 0.36%

A sudden decline in the Hang Sei index in Hong-Kong sparked a wave of selling in global stocks, but the major US indices recovered well during the session, which marked the 30th anniversary of Black Monday, the largest one-day decline in history. Today, there was no follow through after the early losses, and with IBM still leading the way, the Dow and mega caps pulled the market higher.

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With the dovish candidates gaining momentum in prediction markets regarding the next Fed Chair, the Dollar slid lower for the second day in a row, losing ground to the Euro, the Yen, and the Loonie, but the struggling Great British Pound turned south again thanks to the lingering Brexit fears.

NASDAQ 100 Futures, 4-Hour Chart Analysis

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The New Zealand Dollar and the local coalition talks made headlines, as the Kiwi lost more than 2% against the major currencies following the announcement of the new Labour-led government. The currency hit a new 5-month low against the Greenback amid the rout and got close to key 0.70 level as well.  Gold continued its rebound thanks to the stock weakness and the Dollar sell-off, but the precious metal is still well-off the $1300 level after the weakness earlier on this weak. Crude oil remains very choppy, as it fell below the $52 barrel yet again, extending the trendless, hard-to-trade period in the crucial commodity.

NZD/USD, 4-Hour Chart Analysis

Cryptocurrencies

The sharp drop of yesterday is just a faint memory for Bitcoin traders, as the most valuable cryptocurrency is back near its all-time high, leading the swift recovery in the segment. Most of the majors are up today, with Ripple and Ethereum still being in the center of attention, following the Byzantium update of the second largest blockchain and the extremely volatile days of XRP. The rest of the majors are less volatile, with notable weakness in the market of NEO and IOTA, and a generally calmer environment following yesterday’s turmoil.

XRP/USDT, 4-Hour Chart Analysis

Technical Picture

Gold might have formed a crucial higher low this week that could propel the next leg higher in the long-term uptrend, providing a good buying opportunity for both investors and traders. The precious metal is after a bullish cross in the MACD indicator with a favorable stop loss level found below yesterday’s low. Gold faces resistance near the key $1300 level, and above that      around $1315.

Gold, 4-Hour Chart Analysis

Key Economic Releases on Thursday

Time, CET Country Release Actual Expected Previous
2:30 AUSTRALIA Employment Change 19,800 15,200 54,200
2:30 AUSTRALIA Unemployment Rate 5.5% 5.6% 5.6%
4:00 CHINA GDP 6.8% 6.8% 6.9%
4:00 CHINA Industrial Production 6.6% 6.4% 6.0%
10:30 UK Retail Sales -0.8% -0.1% 1.0%
14:30 US Unemployment Claims 222,000 245,000 243,000
14:30 US Philly Fed Index 27.9 22.2 23.8

Key Economic Releases on Friday

Time, CET Country Release Expected Previous
14:30 CANADA CPI 0.3% 0.1%
14:30 CANADA Core Retail Sales 0.3% 0.2%
16:00 US Existing Home Sales 5.32 mill 5.35 mill

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Analysis

Technical Analysis: Coins Recover from Sell-Off as Bulls Remain in Control

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Following yesterday’s brief but deep correction, the major cryptocurrencies seem to be back on the bullish track, as Bitcoin is leading the segment yet again. With the most valuable coin’s dominant currently near 56%, trading in BTC dwarfs the other crypto markets. That said, most of the majors recovered well after yesterday’s rout, while Bitcoin itself reached as high as $5730 today in early trading, only a few percents off its all-time high.

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The short-term setup is encouraging for bulls, as the coin cleared the overbought short-term momentum readings while remaining inside the rising trend. A rally towards the long-term target at $6000 is still likely, despite the stretched long-term picture. Support levels are found near $5400, around the $5000 level and at $4650.

BTC/USD, 4-Hour Chart Analysis

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Ripple settled down somewhat in early trading but it turned volatile again later on, and the coin is still underperforming the broader market, while Ethereum bounced back well above the $300 level, remaining well below its recent highs. The rest of the market is modestly higher today, although NEO and IOTA are slightly lower still showing a negative correlation with the other majors. Let’s see the short-term charts after the short volatile period.

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Analysis

Daily Analysis: Dow Leapfrogs 23,000 as IBM Beats Estimates

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Wednesday Market Recap

Asset Current Value Daily Change
S&P 500 2560 0.13%
DAX 13043 0.35%
WTI Crude Oil 52.02 0.29%
GOLD 1284.00 -0.23%
Bitcoin 5435 -3.15%
EUR/USD 1.1793 0.23%

IBM surged higher today, as the company beat analysts’ expectations across the board, pushing the company’s shares up by more than 10% and helping the Industrial Average to a new all-time high yet again. The other major US indices kept on grinding higher as well for most of the day, despite the strong overvaluation, with the Volatility Index (VIX) still hovering around the 10 level. The NASDAQ and the S&P 500 finished virtually unchanged after a late-session sell-off, while small caps outperformed in the mixed environment.

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DOW 30 Index, Daily Chart Analysis

Global stocks also edged higher, with the Nikkei still leading the way, although the momentum of the move is still weak. The Yen’s weakness was the most apparent trend in currency markets, while the Pound rebounded well, despite the persistent Brexit worries, with the Dollar giving back some of its recent gains compared to its major peers. Gold also remained under pressure after retreating back below $1300 this week, while crude oil rallied on a bigger than expected, hurricane-related decline in US production.

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Gold 4-Hour Chart Analysis

Cryptocurrencies

The major coins had a hectic and bearish session, especially in early trading, as Bitcoin’s overbought conditions coupled with Ripple’s sudden downturn led to a segment-wide decline. Ethereum continued to slip, as the Byzantium-related optimism faded away, but it remained well above the $285 level, and recovered above $300 towards the end of the session. NEO and IOTA still have a negative correlation with the rest of the market, as the two coins surged higher in early trading and gave back their gains during the late-day rebound.

BTC/USD, 4-Hour Chart Analysis

Technical Picture

The DAX closed on a marginal new all-time high again, but the lengthy momentum divergence in the MACD indicator suggests that the steep uptrend continues to be in jeopardy. The low-volatility drift carried the benchmark above the 13,000 level, but a correction towards at least the 12,850 level is likely in the coming days, with another support level at 12,650 serving as a longer-term target. As the long-term uptrend is clearly intact, bears shouldn’t go all-in here but bulls should consider exiting their positions and wait until a correction to trade the long side again.

DAX, 4-Hour Chart Analysis

Key Economic Releases on Wednesday

Time, CET Country Release Actual Expected Previous
3:30 EUROZONE Mario Draghi Speaks
3:30 UK Average Earnings 2.2% 2.1% 2.1%
14:30 UK Claimant Count 1,700 3,200 -2,800
14:30 UK Unemployment Rate 4.3% 4.3% 4.3%
16:00 CANADA Manufacturing Sales 1.6% -0.1% -2.6%
14:30 US Building Permits 1.22 mill 1.25 mill 1.27 mill
16:00 US Housing Starts 1.13 mill 1.18 mill 1.18 mill
15:45 US Crude Oil Inventories -5.7 mill -4.7 mill -2.7 bill

Key Economic Releases on Thursday

Time, CET Country Release Expected Previous
2:30 AUSTRALIA Employment Change 15,200 54,200
2:30 AUSTRALIA Unemployment Rate 5.6% 5.6%
4:00 CHINA GDP 6.8% 6.9%
4:00 CHINA Industrial Production 6.4% 6.0%
10:30 UK Retail Sales -0.1% 1.0%
14:30 US Unemployment Claims 245,000 243,000
14:30 US Philly Fed Index 22.2 23.8
15:45 US Chicago PMI 58.6 58.9

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