Pandemic Won’t Alter Supply Chains For Now, Shipping Giant Says

Pandemic Won’t Alter Supply Chains For Now, Shipping Giant Says

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© Bloomberg. Shipping containers sit stacked on the CMA CGM Ivanhoe cargo ship sailing from the Port of Oakland in Oakland, California, U.S., on Tuesday, July 3, 2018. President Donald Trump threatened to impose tariffs on every single Chinese import into America as the world's two largest economies exchanged the first blows in a trade war that isn't set to end anytime soon. Photographer: David Paul Morris/Bloomberg© Bloomberg. Shipping containers sit stacked on the CMA CGM Ivanhoe cargo ship sailing from the Port of Oakland in Oakland, California, U.S., on Tuesday, July 3, 2018. President Donald Trump threatened to impose tariffs on every single Chinese import into America as the world’s two largest economies exchanged the first blows in a trade war that isn’t set to end anytime soon. Photographer: David Paul Morris/Bloomberg

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(Bloomberg) — There will be little change to global supply chains in the aftermath of the coronavirus, at least in the short term, according to the Chief Financial Officer of the world’s third-largest container company.

Marseille-based CMA CGM expects to see a 15% volume contraction in the second quarter, which will be the lowest point of the year, said Michel Sirat in a phone interview on Friday. After that, volumes “should be up in all recovery scenarios.”

“We’re relatively confident about 2020,” he said.

Sirat said that any moves to alter supply chains are likely to be slow and customers will continue to buy goods in China post-pandemic.

The coronavirus revealed weaknesses in global supply networks including a heavy reliance by the auto-parts industry on the Chinese province of Hubei, where the first outbreak occurred. Plant shutdowns there sent global carmakers scrambling for parts, creating havoc within plants around the world.

Sirat was speaking as CMA CGM released first quarter earnings that showed it swung to a net income of $48 million from a $43 million net loss a year earlier. Revenue was $7.19 billion in the first quarter, down 3% compared to the same period of last year, according to a statement. Earnings before interest, taxes, depreciation, and amortization jumped 25% to $973 million over the same period, mainly due to cost cutting measures put in place in 2019.

The company recently secured a 1.05 billion euros loan, 70% backed by the French state. The guarantee on the loan came with few conditions apart from a commitment not to issue a dividend this year and to pay suppliers on time, Sirat said.

Early in March, the shipping operator obtained a three-year extension on $535 million of credit lines maturing in 2020.

CMA CGM’s bonds due January 2025 rose 2.4 cents on the euro on Friday, to around 80 cents, according to data compiled by Bloomberg.

©2020 Bloomberg L.P.

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Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

More State, City Jobs Lost in Two Months Than During Recession

More State, City Jobs Lost in Two Months Than During Recession

© Reuters.  © Reuters.

(Bloomberg) — In the last two months, states and cities have cut more jobs than they did after the last recession.

Even as businesses hired employees back as much of the nation started reopening, the number of workers on state and local government payrolls fell by 571,000 to 18.3 million in May, according to U.S. Bureau of Labor Statistics data released Friday. That pushed the number of job cuts to about 1.5 million over the past two months, roughly twice as many as were ushered in after the last economic contraction over a decade ago.

Many of the job losses may be reversed when idled employees are called back as states reopen schools and their economies. But the steep cuts underscore the deep financial strain on usually slow-to-act states and cities, which are facing massive budget deficits after surging unemployment and business closures decimated their tax collections.

“The main take away is that this is happening because of intense shortfalls on the state and local levels,” said Wesley Tharpe, deputy director of state research at the Center on Budget and Policy Priorities. “A lot of the decline we may be seeing may be furloughs, but without additional aid from federal policy makers a lot of those furloughs will become permanent layoffs because states have to balance their budgets.”

Most of the public sector losses where from schools with 373,200 jobs cut last month, which are likely to reverse when students return to classrooms. Outside of education, states cut 20,700 jobs and local governments eliminated 176,900 positions.

Such job cuts, if maintained, could exert a drag on the recovery. States alone are expected to face a $765 billion shortfall over the next three years based on projections by the Center of Budget and Policy Priorities. U.S. cities and towns are projected to lose about $360 billion of revenue through 2022, according to the National League of Cities.

Michigan is requiring state employees to take two days off every two weeks from May 17 to July 25, in order to cut payroll costs by $80 million. The state is expecting a budget gap twice what it suffered during the last recession. New Jersey may have to cut half of its 400,000 state and local employees if the federal government doesn’t help make up a $10.1 billion revenue shortage through June 2021, Governor Phil Murphy said.

Congress hasn’t passed direct aid to states and cities to address their budget shortfalls, with a Democrat-backed plan to provide some $1 trillion stalled.

“It’s going to be a very incomplete recovery, even at the end of 2021, if we don’t deal with the state and local sector,” said Josh Bivens, director of research at the Economic Policy Institute, in an interview this week.

©2020 Bloomberg L.P.

 

Disclaimer:
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Trump Claims Victory for Jobs Report as Dow Soars

Trump Claims Victory for Jobs Report as Dow Soars

© Reuters.  © Reuters.

By Liz Moyer

Investing.com — President Donald Trump appeared in the Rose Garden Friday morning to claim victory for an unexpectedly strong May jobs report.

The unemployment rate in May fell to 13.3%, the Labor Department reported on Friday, confounding expectations as hiring rebounded. Economists had predicted the unemployment rate would rise to as much as 20% after reaching 14.7% in April. It is still the highest since the post World War II period, but it sent stocks soaring in early U.S. trading. The rose more than 700 points.

“We’re going to be back and we’re opening our country,” he said, adding that he’s not sure why some states have lagged behind others in loosening Covid-19 restrictions.

“We’re going to be back higher,” he said. “The only thing that can stop us is bad policy.”

Employers added 2.5 million jobs last month, contrasting sharply with the loss of 20 million jobs in April amid the Covid-19-related business shutdowns.

“These improvements in the labor market reflected a limited resumption of economic activity that had been curtailed in March and April,” the Labor Department said in a news release.

Trump took to Twitter to celebrate on Friday. “It’s a stupendous number,” he wrote. “It’s joyous.”

He fired off nine tweets in short order, taking a victory lap for the numbers.

Employment jumped in the sectors that were hardest-hit by the business shutdowns. Leisure and hospitality jobs jumped 1.2 million in May, nearly half the total gain for the month, after jobs in the sector contracted 7.5 million in April. It is not known how much the Paycheck Protection Program, a government assistance program for small businesses meant to encourage employers to keep workers on their payrolls, contributed to the jump in hiring numbers last month.

Disclaimer:
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Why do prices move so fast with some news announcements?

S&P 500, Nasdaq 100, FTSE 100 Technical Outlook For Next Week

S&P 500, Nasdaq 100, FTSE 100 Technical Outlook For Next Week

S&P 500, FTSE 100 Analysis and News

  • S&P 500 | Is the Best Behind Us?
  • Nasdaq 100 | Fresh Record High, Beware of Bearish Divergence
  • FTSE 100 | Recovery Extends

S&P 500 | Is the Best Behind Us?

The S&P 500 has broken above key resistance in the form of the 76.4% Fibonacci retracement of the Q1 crash, which in turn has opened the door to further gains. Eyes will be on the weekly close, whereby a hold above 3200 may keep topside resistance at 3260 within its site. While bullish momentum this week has shown little signs of easing, 3260 could pave the way for slight consolidation. Alongside this, given the size of the rally in equities, current levels suggest that the best may be behind us, much like the Nasdaq 100, which hit a fresh record high. On the downside, support in the S&P 500 is situated in the low 3100s.

US 500

BEARISH

Data provided by



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of clients are net short.

Change in Longs Shorts OI
Daily -2% -17% -14%
Weekly -2% -10% -8%

S&P 500 Price Chart: Daily Time Frame

S&P500 Chart

Source: IG Charts

Nasdaq 100 | Fresh Record High, Beware of Bearish Divergence

Nasdaq 100 Chart

FTSE 100 | Recovery Extends

Despite lagging its major counterparts, the FTSE 100 has gone from strength to strength after breaking above the 50% retracement of the Q1 sell-off, while also closing the early March gap. That said, the FTSE 100 looks to potentially extend its recovery toward the first hurdle at the 61.8% fib at 6579 before the 200DMA (6747).

FTSE 100

BULLISH

Data provided by



of clients are net long.



of clients are net short.

Change in Longs Shorts OI
Daily -11% -5% -8%
Weekly -21% 19% -1%

FTSE 100 Price Chart: Daily Time Frame

FTSE 100 Price Chart

Source: IG Charts

How to Trade FTSE 100

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Whether you are a new or experienced trader, we have several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.

— Written by Justin McQueen, Market Analyst

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Euro Technical Forecast: EUR/USD, EUR/JPY, EUR/GBP, EUR/CHF

Euro Technical Forecast: EUR/USD, EUR/JPY, EUR/GBP, EUR/CHF

Euro, EUR/USD, EUR/JPY, EUR/GBP, EUR/CHF Price Analysis

  • It was a big week for the risk trade as global equity markets continued their ascent.
  • Optimistic developments in Europe continue to stoke hopes for a faster recovery than initially expected.
  • EUR/JPY jumped up to a fresh yearly-high as EUR/USD stares down a strong zone of prior resistance. EUR/CHF and EUR/GBP could present some items of interest for Euro bulls.

Risk Rally Continues as Euro Drives Higher with Optimism

It was a big week for the risk trade in a number of ways. After the blowout NFP report on Friday the Nasdaq 100 jumped up to a fresh all-time-high; and this is taking place as a global pandemic remains and a bout of social unrest has begun to show in the US. Reverberations still continue to show in Europe as the ECB came to the table with an even larger stimulus package than expected this week, highlighting even more optimism for the European economy following the fiscal breakthroughs in the weeks prior.

And on a price basis – the Euro continued to show strength against many major currencies as EUR/JPY has just spiked up to a fresh yearly high, testing above the 124.00 level after having bottomed-out below 115.00 in the early-portion of last month.

EUR/JPY Technical Forecast: Bullish

EUR/JPY Four Hour Price Chart

EURJPY Chart

Chart prepared by James Stanley; EUR/JPY on Tradingview

EUR/USD Shies Away from 1.1400, Nears Huge Resistance

EUR/USD has shown similar strength of recent but given the additional Yen-weakness that’s entered the equation (as can be witnessed in the USD/JPY pair), that bullish run in the major pair isn’t quite as strong. And notably, on Friday when stocks were bursting higher in the US session and as EUR/JPY continued to jump, EUR/USD held resistance just inside of the 1.1400 handle.

EUR/USD

BEARISH

Data provided by



of clients are net long.



of clients are net short.

Change in Longs Shorts OI
Daily 3% -1% 0%
Weekly 9% -5% -1%

This pair or setup may look a touch less bullish than the EUR/JPY setup above. While EUR/JPY has already jumped to a fresh yearly high, EUR/USD is staring down a huge zone of potential resistance that runs from 1.1448-1.1500. This is the same area that caught the March spike in the pair and that inflection point currently represents the yearly-high.

EUR/USD Technical Forecast: Neutral

EUR/USD Daily Price Chart

EURUSD Daily Price Chart

Chart prepared by James Stanley; EUR/USD on Tradingview

EUR/CHF Continues Streak on Way to Fresh Highs

While EUR/CHF may not be as popular of a pair, I wanted to include it in this forecast for a couple of reasons: The trend of recent has been very consistent, and while there’s no assurance that’ll continue in the same manner, it does highlight the potential of the pair to be a focal point for the European recovery theme. And, additionally, given the focus around the Swiss National Bank it might be difficult for the SNB to actively engage in currency-weakness policies and this may put more of the onus on the pair’s performance on the side of the Euro.

In EUR/CHF, conditions have quickly moved into deep overbought territory. But, so far, buyers have just continued to push. On the below chart, a few different spots of possible support have been identified in red, along with a couple of items of possible resistance outlined in green.

EUR/CHF Technical Forecast: Bullish

EUR/CHF Daily Price Chart

EURCHF Daily Price Chart

Chart prepared by James Stanley; EUR/CHF on Tradingview

EUR/GBP Tests Chart Support

The cross pair of EUR/GBP is in an interesting spot and, for this week, the British Pound was actually stronger than the Euro, leading to a net negative move, with price action testing the 50% marker of a key Fibonacci retracement. There’s also a nearby trendline just underneath price action that can be found by connecting February and May swing lows; and this can present an interesting option for Euro bulls given proximity to support.

EUR/GBP Technical Forecast: Bullish

EUR/GBP

MIXED

Data provided by



of clients are net long.



of clients are net short.

Change in Longs Shorts OI
Daily -12% -5% -8%
Weekly 0% -16% -9%

EUR/GBP Daily Price Chart

EURGBP Price Chart

Chart prepared by James Stanley; EUR/GBP on Tradingview

— Written by James Stanley, Strategist for DailyFX.com

Contact and follow James on Twitter: @JStanleyFX

S&P 500 Surges as VIX ‘Fear-Gauge’ Implodes Post-Jobs Report

S&P 500 Surges as VIX ‘Fear-Gauge’ Implodes Post-Jobs Report

S&P 500 PRICE OUTLOOK: VIX INDEX, CROSS-ASSET VOLATILITY PLUNGES AFTER JOBS DATA

  • S&P 500, Dow Jones, Nasdaq explode higher with stocks surging in response to shockingly better-than-expected monthly jobs data
  • VIX Index ‘fear-gauge’ collapses below its 200-day moving average as investor sentiment improves and cross-asset volatility normalizes
  • The headline NFP figure provided a reason for optimism, but looking ‘under the hood’ paints a much bleaker picture and leaves the risk rally in jeopardy

The stock market is making another explosive move higher to close out the first week of June. Equities have advanced sharply on the back of jobs data just released, which smashed expectations, and primarily fueled the near 3% jump notched by the S&P 500 Index to trade back above the 3,200-price level.

US 500

BEARISH

Data provided by



of clients are net long.



of clients are net short.

Change in Longs Shorts OI
Daily -2% -17% -14%
Weekly -2% -10% -8%

S&P 500 WITH VIX INDEX PRICE CHART: DAILY TIME FRAME (DEC 2019 – JUN 2020)

SP500 Price Chart VIX Index Stocks Volatility

Chart created by @RichDvorakFX with TradingView

Meanwhile, as risk appetite crushes volatility and pushes stocks higher, the VIX Index has plunged back below its 200-day moving average to fluctuate near the 24.0-mark and its weakest reading since February. Though the VIX Index might keep bleeding lower to fill the gap-up above the 20-handle printed earlier this year, market sentiment could struggle to overlook this bad omen and several outstanding threats still faced by stocks.

Equities Forecast

Equities Forecast

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US EMPLOYMENT SITUATION IMPROVED BUT LOST JOBS STILL STAGGERING

NFP Nonfarm Payrolls Chart Jobs Report Historical Data

As one would expect, investors cheered better-than-expected readings for the unemployment rate and net change in nonfarm payrolls just detailed in May 2020 jobs report. According to the DailyFX Economic Calendar, actual figures for the unemployment rate and net change in NFP crossed the wires at 13.3% and 2.5 million, respectfully. This compares to median estimates looking for 19.8% and -7.5 million.

That said, the US employment situation still seems fundamentally damaged. The latest jobs report, while impressive on the surface, looks far worse when taken into perspective. Largely due to the coronavirus lockdown and likely unavoidable recession, nearly 20-million jobs have been obliterated over the last three months on balance. Total nonfarm payrolls currently stands at 132.9-million employed Americans, which puts the US labor market on par with December 2011 levels.

Trading Forex News: The Strategy

Trading Forex News: The Strategy

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Trading Forex News: The Strategy

Questionable calculation methodologies, like showing an increase in employment even with no new hiring, appear to have artificially inflated the headline nonfarm payrolls number as well. Further, a rebound in consumption to pre-COVID levels seems like a fantasy with 21.5-million Americans still filing for unemployment insurance amid widespread social unrest underpinned by rioting and looting alongside George Floyd protests.

VIX INDEX FUTURES TERM STRUCTURE

VIX Index Price Chart Volatility Futures Term Structure

This is also increasing the odds for a second wave of coronavirus cases. Not to mention, Sino-American trade uncertainty still lurks on the horizon as China tension flares, which presents another headwind to recovering consumer confidence. Since 29 May, the shift lower across monthly VIX Index futures settlements appears more pronounced on the short end of the curve.

Top Trading Opportunities in 2020

Top Trading Opportunities in 2020

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This might indicate that investors, though increasingly optimistic, remain cautious with regards to market outlook further down the horizon. Also judging by VIX Index futures, expected S&P 500 volatility is particularly elevated around October and November 2020, which happens to align with the upcoming US presidential election and presents a source of uncertainty.

— Written by Rich Dvorak, Analyst for DailyFX.com

Connect with @RichDvorakFX on Twitter for real-time market insight

Gold Forecast: 2012 High Still on Radar as Price Holds May Range

Gold Forecast: 2012 High Still on Radar as Price Holds May Range

Gold Talking Points

The price of gold has traded to fresh yearly highs during every single month so far in 2020, and the precious metal may continue to exhibit a bullish behavior in June as the pullback from the yearly high ($1765) reverses ahead of the May low ($1670).

Technical Forecast for Gold: Bullish

The price of gold tracks the May range ahead of the Federal Reserve interest rate decision, but the technical outlook remains constructive despite the failed attempt to test the 2012 high ($1796).

Keep in mind, the opening range for 2020 instilled a bullish outlook for gold as the precious metal cleared the 2019 high ($1557), with a similar scenario materializing in February as bullion tagged a fresh yearly high ($1689)after marking the monthly low ($1548) during the first full week.

The monthly opening range for March was less relevant amid the actions taken by major central banks in response to COVID-19, but the price for gold still traded to a fresh yearly high ($1704) prior to the break of the January low ($1517).

Bullion climbed to a fresh yearly high ($1748) in April following the reaction to the former-resistance zone around $1450 (38.2% retracement) to $1452 (100% expansion), with the bullish behavior also taking shape in May as the precious metal traded to a fresh 2020 high ($1765).

In turn, the 50-Day SMA and 200-Day SMA continue to track the positive slopes from earlier this year, and the low interest rate environment along with the ballooning central bank balance sheets may continue to act as a backstop for goldas marketparticipants look for an alternative to fiat-currencies.

With that said, the price for bullion may continue to exhibit a bullish behavior in June as the pullback from the yearly high ($1765) reverses ahead of the May low ($1670).

Gold Price Daily Chart

Gold price chart

Source: Trading View

The price of gold continues to consolidate after failing to test the November 2012 high ($1754), but the ability to hold above the $1676 (78.6% expansion) region instills a constructive outlook as it largely lines up with the May low ($1670).

The Relative Strength Index (RSI) displays a similar dynamic as the indicator breaks out of the negative slope from the previous month, but need the price of gold to close above the Fibonacci overlap around $1733 (78.6% retracement) to $1743 (23.6% expansion) to bring the topside hurdles on the radar.

First area of interest comes in around $1754 (261.8% expansion), with the next region coming in around $1786 (38.2% expansion) followed by the 2012 high ($1796).

— Written by David Song, Currency Strategist

Follow me on Twitter at @DavidJSong

Dollar Price Outlook: USD Technical Breakdown at Yearly Open Support

Dollar Price Outlook: USD Technical Breakdown at Yearly Open Support

US Dollar Technical Price Outlook: DXY Near-term Trade Levels

  • US Dollar technical trade level update – Daily & 120min Charts
  • DXY marks eight-day decline into yearly open support at 96.50
  • Key resistance 97.87 – break below 96.21 needed to fuel next leg

The US Dollar plunged more than 3% on an eight-day decline with the index now down more than 6% from the yearly highs. Price is testing a major support confluence into the close of the week and the focus is on a reaction just lower for guidance. These are the updated technical targets and invalidation levels that matter on the US Dollar Index (DXY) weekly price chart. Review my latest Weekly Strategy Webinar for an in-depth breakdown of this US Dollar trade setups and more.

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US Dollar Index Price Chart – DXY Daily

US Dollar Index Price Chart - DXY Daily - USD Trade Outlook - Technical Forecast

Chart Prepared by Michael Boutros, Technical Strategist; US Dollar Index on Tradingview

Technical Outlook: In my last US Dollar Weekly Price Outlook we noted that the, “The Dollar Index has broken below a multi-week consolidation / the May opening-range lows and keeps the focus lower heading into June.” The greenback is down more than 1.3% this week as the decline took another leg lower with DXY testing confluence support into the close on Friday.

The zone in focus is 96.44/50– a region defined by the objective yearly open & the 78.6% Fibonacci retracement of the March advance and converges on basic parallel support. The 100% extension of the broader decline rests just lower at 96.21 and a break / close below this threshold is needed to keep the immediate short-bias viable towards the 2019 low-day close at 95.55.

US Dollar Index Price Chart – DXY 120min

US Dollar Index Price Chart - DXY 120min - USD Trade Outlook - Technical Forecast

Notes: A closer look at Dollar price action shows DXY trading within the confines of a descending pitchfork formation extending off the May highs with the lower parallel further highlighting the 96.44/50 support zone. Initial resistance now at the median-line / November lows at 97.11 with near-term bearish invalidation now lowered to the 2018 high / 61.8% retracement at 97.71/87– a breach / close above this threshold would be needed to shift the focus back to the long-side in the Dollar.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy

Bottom line: The US Dollar breakdown has taken the index into confluence support at the objective yearly open. From at trading standpoint, a good spot to reduce short-exposure / lower protective stops. Be on the lookout for topside exhaustion ahead of 97.87 IF price is indeed heading lower with a close below 96.21 needed to mark resumption. Keep in mind we have the FOMC interest rate decision on tap next week – stay nimble.

USD Forecast

USD Forecast

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Key US Data Releases

Key US Data Releases - Dollar Economic Calendar - USD Event Risk Ahead

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— Written by Michael Boutros, Technical Strategist with DailyFX

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Natural Gas Price: May Rally Further As Support Level Holds

Natural Gas Price: May Rally Further As Support Level Holds

Natural Gas Technical Forecast

  • Bears ease up-selling pressure
  • Will bulls take charge?

Natural Gas Price – Indecisive Traders

On Friday, natural gas declined to a two-week low at $1.772 then rallied after and closed the weekly candlestick with a Doji pattern signaling the market’s indecision at this stage.

Alongside that, the Relative Strength Index (RSI) remained flat below 50 highlighting a paused bearish momentum.

Nat-Gas DAILY Price CHART (Nov 2, 2018 – June 5, 2020) Zoomed Out

Natural gas daily price chart 05-06-20 zoomed out

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Natural Gas DAILY Price CHART (March 10 – June 5, 2020) Zoomed IN

Natural gas daily price chart 05-06-20 zoomed in

On May 29, the price rebounded from the uptrend line originated from the April 16 low at $1,653. This week, Natural gas remained trading above the aforementioned line reflecting bear’s hesitation. Yesterday, the market climbed to the current trading zone $1,850 – $2,050 yet closed below the 50-day moving average.

Another close above the low end of the trading zone may encourage bulls to push towards the high end of it. A further close above this level may extend the rally towards $2,139.

On the flip-side, any close below the low end of the zone signals a possible fall towards $1,655. A further close below that level could send the market even lower towards $1,430.

That said, the daily and weekly support and resistance levels marked on the daily chart should be kept in focus.

Building Confidence in Trading

Building Confidence in Trading

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Natural Gas price Four-Hour PRICE CHART (May 25 – June 5, 2020)

natural gas four hour price chart 05-06-20

On Monday, the price rallied above the downtrend line originated from the May 27 high at $1,979 and generated a bullish signal. Yesterday, the price respected the uptrend line originated from the June 1 low at $1,760 and provided another bullish signal.

Thus, a break above $1,927 could trigger a rally towards $2,040 in turn, a break in the other direction i.e. below $1,822 may send natural gas back towards the June 1 low mentioned above. Nonetheless, the daily support and resistance underlined on the four-hour chart should be watched closely.

Written By: Mahmoud Alkudsi, Market Analyst

Please feel free to contact me on Twitter: @Malkudsi