06/06 Market report

【Dow Jones】

Although the growth of non-farm payrolls in the United States slowed down in May, it still far exceeded market expectations. The unemployment rate also remained at a low level of 3.6% which was originally a bullish data but it had a “negative” effect on the US stock market. The trading volume shrank to less than the level of 10 billion shares. As the U.S. labour market continued to strengthen and reinforce expectations of a 50 basis point rate hike in June and July, the stimulus indicator 10-year Treasury yield rose to a nearly 3% mark. Major U.S. stock indexes flipped short on Friday, shaking intraday.

In the daily technical indicator of the Dow Jones Index, Alligator shows an entanglement, while the KD indicator also shrunk. The next step is to wait for a clearer direction in the short term amidst the consolidation.

USA30-D1

Resistance point 1: 33500 / Resistance point 2: 33800 / Resistance point 3: 34200

Support point 1: 32500 / support point 2: 32000 / support point 3: 31500

【EUR】

The May non-farm payrolls data supported aggressive tightening by the US Federal Reserve. Investors increased their bets on the European Central Bank (ECB) rate hike after the release of strong inflation data and digested the expectation that the ECB would raise interest rates sharply by 50 basis points at a policy meeting before October. The latest data showed that eurozone inflation was at record highs.

In the technical indicators of the euro daily line, Alligator presents a golden cross while the KD indicator also shows a golden cross. This indicates that there is still buying strength in the EURUSD and the bulls have the advantage. This is because of the European Central Bank's expected interest rate hike. Investors money should flow back to the euro once again.

EURUSD-D1

Resistance point 1: 1.07500 / Resistance point 2: 1.07800 / Resistance point 3: 1.08200

Support point 1: 1.06800 / support point 2: 1.06200 / support point 3: 1.05800

【Gold】

In May, gold prices fell sharply with fed rate hikes and warnings that there would be more rate hikes!

Franklin Securities Investment Advisor said that after gold has fallen below $1900 and then $1850, these two prices have turned from support to resistance. The Fed Beige Book revealed that prices in most parts of the United States are still rising which may make Fed maintain a hawkish interest rate hike stance. Gold may continue to be under pressure in the short term. If the gold price rises in the short term, there may still be a rebound.

In the technical indicators of the gold daily line, Alligator shows an entanglement while the KD shows a gold crossover. This indicates that the bulls on the short-term line still exist. The current stage of gold continues to oscillate near $1850 per ounce but the recent focus has been on the US dollar – When the US dollar rises, gold usually falls and vice versa.

XAUUSD-D1

Resistance point 1: 1860.00 / Resistance point 2: 1880.00 / Resistance point 3: 1900.00

Support 1: 1840.00 / Support 2: 1820.00 / Support 3: 1800.00

【Crude Oil】

It was reported that Eni S.P.A and Spanish national oil company (Repsol SA) could begin shipping Venezuelan oil to Europe as early as next month to make up for the gap in Russian crude oil which would resume the suspension of Venezuelan oil-for-debt swaps with Europe after Washington stepped up sanctions on Venezuela two years ago.

In the technical indicators of the daily line of crude oil, Alligator presents a golden cross while the KD also shows a golden cross. This indicates that the bulls on the short-term are quite strong. Crude oil continues to challenge the swing highs.

USOIL-D1

Resistance point 1: 121.800 / Resistance point 2: 123.500 / Resistance point 3: 125.200

Support point 1: 118.500 / Support point 2: 116.200 / Support point 3: 114.800

OnePro Special Analyst

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