Daily Analysis: Stocks Surge to New All-Time Highs Despite GDP Miss

Friday Market Recap

Asset Current Value Daily Change
S&P 500 2874 1.19%
DAX 13340 0.35%
WTI Crude Oil 66.12 1.08%
GOLD 1348.00 -1.06%
Bitcoin 10,870 -4.29%
EUR/USD 1.2427 0.24%

Markets ended a busy week in a very volatile fashion, although focus shifted somewhat from currencies to stocks following the forex-rollercoaster of Thursday. US stocks recovered without real problems from the volatile consolidation of the last couple of days, and jumped to new all-time highs easily in late trading.

Investors ignored the miss in US growth, as it was the case with all the negative economic surprises this year, even though the overwhelming majority of this year’s releases was bearish. Today, durable goods orders provided some relief for the macro picture, coming in a tad above the consensus estimate.

Despite the relatively calm day in currencies, the Yen and the Australian Dollar both gained significant ground after the optimistic words of Bank of Japan Governor Kuroda, even as the central bank quickly “clarified” that the governor is actually not positive on inflation.

USD/JPY, 4-Hour Chart Analysis

As the currency war burlesque continues to amuse investors, it will be interesting to see next step from the real big players in the field the ECB and Fed. With a new Fed chair stepping up, next week’s FOMC meeting will be closely watched by investors, even as no policy change is forecast after the recent rate hike by the US central bank.

Gold has been one of the major winners in recent weeks, as the Dollar weakness lifted the precious metal, even as stocks and yields continued to climb higher. Gold and silver both entered corrections during yesterday’s Dollar turmoil, and although they finished today’s session on a positive note, the rally highs are well above the current levels. Oil, on the other hand, defied the rising Dollar and the record high number of US oil rigs and hit another new 18-month high before the weekend.

WTI Crude Oil, 4-Hour Chart Analysis

Cryptocurrencies

The major coins had a hectic day after two relatively quiet sessions, as bulls got frightened by a sizeable sell-off in early trading. Although the coins bounced back off their lows towards the end of the day, the charts still look wounded from a short-term technical standpoint and the weekend could provide “hot” for crypto investors yet again. That said, as an investor, the outlook is much more positive after the already deep correction and most of the majors are nearing oversold territory.

BTC/USD, 4-Hour Chart Analysis

While Litecoin, IOTA, Monero, and Dash look ready to test the crash lows very soon, Ethereum, NEO, and especially Stellar are holding strong in the face of the broad weakness in the segment. Despite the strength, we expect Ethereum and NEO to experience deeper corrections as well, as they are still overbought from a long-term perspective, while Stellar will also likely have volatile swings as the segment-wide sell-off concludes.

Stellar/USD, 4-Hour Chart Analysis

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Author:
Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.