Asian stock markets drifted on Friday as investors assessed China’s mixed data after it reopened its economy. Industrial output rose 3.9% from a year earlier, versus a median estimate of 1.5%, and reversing a drop of 1.1% in March. It is the first time that China’s industrial output increased since the coronavirus outbreak, adding to early signs of a recovery that economists cautioned would be slow and challenging. U.S. equity futures are slightly down, as investors are looking forward to closing this week in losses.
USD was little changed on Friday. New claims for unemployment insurance totaled 2.981 million last week.That brings the rolling total during the coronavirus crisis to 36.5 million, though the weekly tally has declined for six straight weeks. While the numbers have been declining since the Mar 28 peak, joblessness remains pervasive through the U.S. even as states continue to come back online slowly following the economic shutdown. While market sentiment is not clear, USD could sideways ahead of tonight’s core retail sales number.
Copper gained on Friday, with London prices rebounding from a more than one-week low hit in the previous session, on hopes that more stimulus to help global economies could boost demand for metals. Three-month copper on the London Metal Exchange rose 1% to $5,255 a tonne by 0136 GMT, rebounding from a more than one-week low hit in the previous session. It was still on track for a weekly loss. Meanwhile, the upsie is still capped while Investors are still worried about if the second wave of infections could happen as countries reopen.
Gold price rose to $1729 per ounce. It seems some investors turn bearish on equities, U.S. China relations continue to head to a downward spiral and U.S. data also comes very bleak. Gold prices have surged over the last couple of weeks but it seems now the macro backdrop is supporting higher prices.
Oil prices pushed higher, breaking out to the upside of what many market observers refer to as a pennant pattern. This is on signs that the market is slowly rebalancing as major producers continue to announce supply cuts . Investors are however still cautious as the recovery in oil prices are not as convincing as what traders would expect. Right now, all eyes are on how the global economies are slowly reopening as this would really drive the demand for oil. The CAD strengthened in line with oil prices however, the movement is muted as investors continue to wait for Bank of Canada’s economic data.
Technical & Trade views
USDCAD (Intraday bias: Bullish above 1.40348)
USDCAD is approaching 1st support where the 78.6% fibonacci retracement and horizontal swing low are. This is also the same level as ascending channel support. Price is likely to bounce from here towards 1st resistance at 1.41389. RSI is also indicating price is touching a support zone.
UKOIL (Intraday bias: Bullish above 30.52)
Oil broke above its descending trendline resistance (now support). With price holding above moving average and MACD above 0, within bullish territory, we expect price to push higher above 1st support at 30.52 towards 1st resistance at 32.21.
XAUUSD ( Intraday bias: bearish below 1736.37)
We turned bearish as price is approaching 1st resistance where the horizontal swing high is. Price is likely to reverse off 1st resistance towards 1st support. MACD is also showing bearish pressure is coming.
XCUUSD ( Intraday bias: bullish above 2.3165)
We turned bullish as price is approaching 1st support where the 38.2% fibonacci retracement and 100% fibonacci extension are. Price is likely to bounce towards 1st resistance at 2.4237 where the horizontal swing high and 61.8% fibonacci extension are.