The USD continued to be punished yesterday after a strong turn about the day before which saw USD dominance evaporated instantly after markets began selling the green back on what has been touted as profit taking after the extended strengthening of the USD thanks to the bullishness of the Fed, who reiterated that they would look to increase interest rates 3 times this year, data permitting.
Wall Street also could not manage a further move higher, as we saw 2 of the major indices, the S&P 500 and Nasdaq 100, snap their record of higher closes to finish the day in the red while the DJIA continued northward albeit for a small gain of 0.04%. Asian equities, followed suit, with the ASX, Nikkei 225 and the Shanghai Comp all closing in the red.
In commodities, crude oil continues to range between the 53.25 and 54 USD mark for the 4th day in a row as markets seem uncertain as to the future of the global economy from a demand perspective and also the validity of the OPEC oil supply cut from a supply perspective. The black gold will remain sensitive to global economic data and output reports, with a strengthening global economy and a firm dip in output, likely to see crude oil pop above the 54 mark as buyers explore higher prices. However, a worsening of the global economy or supply constraint lifting will see crude dip below 53.25 as seller resurface to profit off the uncertainty. Gold has been climbing in recent trade as the natural relationship between itself and the USD is back to normal, with dips in the USD correlating with rallies in gold. The precious metal is currently art 1137 as bulls look to test the all-important 1250 resistance point before the weekend. However, bears will look to capture 1235 as a stepping stone to making their way back to 1220.
Going into the weekend, we will be seeing positons being taken off while new ones are added as traders look to rebalanced their portfolios implying that we may see some volatility entering the market as participants prepare for next week which promises to give more clues as to the health of major economies and the global economy at large.