Daily Markets Broadcast 2019-05-02

Daily Markets Broadcast

2019-05-02

Wall Street drops as Fed pushes back on rate cut hopes

The Fed held rates unchanged, as expected, but crimped market expectations that low inflation would promote a rate cut rather than hike, saying inflation is expected to pick up naturally in the future. Chinese and Japanese markets are closed for the rest of the week.

 

US30USD Daily Chart

Source: OANDA fxTrade

  • The US30 index fell the most in almost six weeks yesterday after the Fed’s comments on inflation
  • Rising 55-day moving average support is at 26,026. A drop through 26,264 would bring a possible double-top formation into consideration
  • US factory orders are expected to rebound in March, rising 1.5% m/m in March following a 0.5% drop in February.

 

DE30EUR Daily Chart

Source: OANDA fxTrade

  • The Germany30 index has snapped a four-day winning streak in early trading this morning in response to the Fed decision yesterday. So far, the index has dropped the most since April 9. Markets were closed yesterday for the May Day holiday
  • The 55-day moving average crossed above the 200-day moving average on Tuesday and is now at 11,710
  • German retail sales are seen falling 0.4% m/m in March after a 0.9% increase in February.

 

UK100GBP Daily Chart

Source: OANDA fxTrade

  • The UK100 index posted the biggest one-day loss since March 22 yesterday following the Fed meeting. Reports suggest that PM May and opposition leader Corbyn may be closer to reaching a compromise, which could pave the way for a Brexit deal.
  • The 55-day moving average is at 7,290. The index has traded above this average since January 30
  • The Bank of England holds its rate meeting today, but is widely expected to leave both rates and its asset purchase unchanged. The Bank seems to be on hold until Brexit is sorted out.

 

 

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Andrew Robinson

Andrew Robinson

Senior Market Analyst at MarketPulse
A seasoned professional with more than 30 years’ experience in foreign exchange, interest rates and commodities, Andrew Robinson is a senior market analyst with OANDA, responsible for providing timely and relevant market commentary and live market analysis throughout the Asia-Pacific region. Having previously worked in Europe, since moving to Singapore he worked with several leading institutions including Bloomberg, Saxo Capital Markets and Informa Global Markets, proving FX strategies based on a combination of technical and fundamental analysis as well as market flow information. Andrew began his career as an FX dealer with NatWest and the Royal Bank of Scotland in the UK.
Andrew Robinson

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