Financial market research and analysis

ECB monetary policy decisions are expected today, with no change (rate 0.00% 80 billion euro purchases in assets per month, these including corporate bonds since March).

The EURUSD in the meantime has bounced on the trend-line after 4 sessions of tests, and has found new momentum, with the pair testing the 1.1200 resistance, before heading towards the 1.1226 resistance (100-dma). The market seems to price in some dovish expectation from Gov. Draghi press conference, since the Euro-zone inflation is still far away from the target.

USDJPY has lost further territory breaking supports and moving to 109.00 mark, testing the last support (50-dma) which if broken might bring the pair to fall to 107.38 (88.6% Fibonacci retracement). The recovery above 109.00 and proceeding to clear resistance at 111.10 (100-dma), might start a new bullish trend.

GBPUSD bounced on support 1.4411 (38.2% major Fibo retrace), and is trying to recover losses of last two sessions, caused mostly by rumours and Brexit polls. Resistance is seen at 1.4578 (23.6% Fib retrace), while below the 1.4330 neck-line the double top pattern might cause further downside with target 1.4000 mark.

In Australia a good trade balance but a disappointing retail sales caused some turbulence into the AUDUSD recovery after the long way down of May. The Aussies is now moving right above 0.7208 support and if it breaks we might see a slump to 0.7144 (May 23th). A new rise above the 0.7281 (200-dma) might increase momentum and put in target 0.7327 (Fibonacci retrace).

Gold is consolidating around 1215/18$ while waiting for the ECB decisions and Friday’s NFP data. The condition of the US labor market might move the expectation on the Fed’s interest rate hike and as a consequence gold might take a new direction.

Oil sets for the longer run in 5 years ahead of June the 2nd OPEC meeting in their headquarters in Vienna. No agreement is expected out of this meeting. WTI is trading below the 49.00 mark, with the next support seen at 47.62 (May 24th low). A new upside to the 49.20/40 area (100 and 50 hours moving averages) could open the gate for the 50$ once again. Offers are solid at this level.