Headlines:

• Dollar breakout gets an early check back
• US debt ceiling concerns – justified or not?
• Fed’s Kashkari: It’s a close call on whether to raise or pause in June
• Eurozone March construction output -2.4% vs +1.7% m/m prior
• SNB total sight deposits w.e. 19 May CHF 515.7 bn vs CHF 520.1 bn prior

Markets:

• CHF leads, JPY lags on the day
• European equities lower; S&P 500 futures flat
• US 10-year yields flat at 3.678%
• Gold down 0.2% to $1,972.01
• WTI crude up 0.1% to $71.62
• Bitcoin down 0.1% to $26,803

It was a quiet session for the most part with a lack of key economic releases not really helping with the mood in Europe. The dollar saw its gains last week checked back on Friday and it was more of the same story today.

The greenback traded more mixed across the board as US debt ceiling concerns continue to work its way through markets. EUR/USD is marginally lower at 1.0810-20 levels as buyers look to push back against a break below its 100-day moving average last week, though upside is capped nearer to the 100-hour moving average for now.

USD/JPY was also largely more tepid around 137.80-90 earlier before Fed’s Kashkari offered up a nudge higher for the pair and bond yields, moving up to 138.20 levels at the moment. That is now helping the pair to build on last week’s break after a bit of a check back early on today and on Friday.

Meanwhile, the franc is the lead gainer as USD/CHF fails to make its way past 0.9000 in a drop back to 0.8960 currently.

Elsewhere, with equities also looking fairly tentative and tepid, the antipodeans aren’t up to much with AUD/USD down 0.2% to 0.6635 and NZD/USD little changed at around 0.6275 on the day.

This article was written by Justin Low at www.forexlive.com.

• Not seeing evidence that banking stress is doing Fed’s job on inflation
• Fed has to keep going in battle against inflation
• Services inflation seems „pretty darn entrenched“
• It may be that we have to go north of 6% but that isn’t clear yet

There seems to be some differing opinions at the Fed currently but the remark on 6% rates is certainly reflective of more hawkish sentiment than what markets are thinking right now. USD/JPY is at the highs for the day now at 138.09 currently.

This article was written by Justin Low at www.forexlive.com.

Similar to EUR/USD and USD/JPY last week, it looked like gold was facing a technical break lower as price fell through the support region of $1,975-81. However, with the dollar getting checked back on Friday and in trading today, we are seeing price action consolidate a little as traders call into question the breakout move from last week.

The US debt ceiling talks seem to be the main focus in markets at the moment and that is arguably keeping dollar gains in check. Now, gold is trading back towards the broken support region of $1,975-81 and so buyers are not quite throwing in the towel just yet.

However, looking at the near-term chart:

It is proving to be a similar case for gold as it is in EUR/USD here. The minor bounce today ran into a test of its 100-hour moving average (red line) and that key level is holding for now. In technical terms, sellers are still in near-term control as such. And it would require buyers to break above that to open up some room to work with between that and the $2,000 mark again.

So, while the downside break is being questioned right now, sellers are still hanging on in there as they hold at the key near-term level pointed out above – now seen at $1,980.38 roughly. Keep below that and the near-term bias remains more bearish but break above and the bias will turn more neutral instead.

But as we can see with other dollar pairs right now, the technical picture is more or less the same. This suggests that dollar sentiment is the key driver of trading conditions currently so it is best to keep the focus on factors impacting that i.e. debt talks, Fedspeak, US economic data.

This article was written by Justin Low at www.forexlive.com.

On the daily chart below for the
Nasdaq, we can see that we got the first negative close last Friday after
several big positive days. The culprit was a negative
news about debt ceiling talks being at a stalemate. We can also see that the
rally stalled at an old swing level that should act as resistance going
forward.

The Nasdaq should still have an
upward bias as the bullish
flag pattern is still playing out perfectly. As things stand, we may keep on
trading on the classic “buy the rumour” playbook as the market expects that
eventually the debt ceiling will be raised. The target of the bullish flag is
the 13000 area with the 13174 high being a nice level to look at.

Nasdaq Technical Analysis

On the 4 hour chart below, we can
see that the month long range beneath the strong 12274 resistance was breached and once the price
retested the broken resistance
turned support, the Nasdaq rallied strongly to the next
resistance at 12660. We now have a trendline that will act as support in case
the Nasdaq makes a deeper pullback to the downside.

On the 1 hour chart below, we can
see that in case we get a pullback from here, the downside should be limited
for the Nasdaq. In fact, we have a minor trendline and Fibonacci
retracement levels that will act as support for the buyers
looking to position for another rally towards the 13000 level. On an even
deeper correction, the buyers should be leaning on the major trendline and the
12274 support as the last line of defence.

The sellers, on the other hand,
are likely to pile in if the Nasdaq breaks below the minor trendline targeting
the major one. If the price falls below the major trendline, then the sellers
should really come in aggressively and target the 11900 support.

This article was written by ForexLive at www.forexlive.com.

EUR/USD is up 0.2% to 1.0825 currently, sitting near the highs for the day. The range today may be relatively narrow still but buyers are seen making a play once again as they contest the 100-hour moving average:

The key level has been a solid near-term spot for sellers to lean on in driving the pair lower from 1.1000 to just below 1.0800 last week. That also resulted in a break below its 100-day moving average, but now that move in itself is being called into question as highlighted earlier today here.

This is certainly keeping things interesting to start the new week and a hold above the 100-hour moving average noted above, will allow for buyers to wrestle back some near-term control. That will open up some room for price action to roam in between that (now at 1.0823) and the 200-hour moving average, now at 1.0867.

As highlighted in the linked post above, this isn’t the only dollar pair which is seeing its breakout move called into question. USD/JPY is also trading flattish at 137.90 now but is seeing its break above 138.00 last week get checked back at the moment.

This article was written by Justin Low at www.forexlive.com.

In this analysis, I will provide a detailed technical analysis of Tesla’s stock price forecast, accompanied by a trade idea that utilizes a unique Fibonacci entry method. I discuss the recent price movements, identify potential patterns, and suggest a trade strategy for traders considering a Long position with TSLA stock. Please note that trading involves risk, and it is important to conduct thorough research and analysis before making any investment decisions.

Analyzing Tesla’s Stock on the Daily Time Frame

Since late 2020, Tesla’s stock has shown indications of a head and shoulders pattern on the daily time frame. The pattern consists of a left shoulder, a head, and a right shoulder. Following the failed attempt at forming the right shoulder and the subsequent break of the neckline, the stock experienced a significant drop, eventually reaching the measured move level.

The measured move is determined by measuring the distance from the top of the pattern to the neckline break and projecting it downward. In this case, Tesla’s stock price dropped from the top to the measured move level.

Technical Analysis and Trade Idea for TSLA Bulls (using Fib entry)

The above video provides further analyis on more recent price action, and creates a trade plan for gradual, step-by-step, ’scaling in‘ buys at increasingly lower prices. If the stock price is reached, the pre-made, exising buy orders will get filled.

Futher points covered in the above video :

• Tesla Stock Price Forecast 2023: Analysis and Fibonacci Trade Idea
• Analyzing Tesla Stock: Technical Analysis and Head and Shoulders Pattern
• Understanding the Bull Flag Pattern: Upside Potential for Tesla Stock
• Fibonacci Entry Method: Optimizing Trade Entry Points for Tesla
• Managing Risk and Targeting Profits: Stop Loss and Profit Targets

Make sure you have watched the entire video above and feel free to subscribe you the ForexLive.com Youtube Channel and activate alerts to get notified as our videos are published.

This article was written by Itai Levitan at www.forexlive.com.

US President Biden is in Japan for the G7 leaders‘ summit.

While the cat’s away the mice are not making progress. This is the latest out of Washington politics surrounding the debt ceiling negotiations:

US House Speaker Republican Kevin McCarthy

• said he is not seeing progress while the President is away –

  “Unfortunately, the White House moved backwards,” McCarthy told reporters (link to US politics media, The Hill, for more if you are interested)

Meanwhile on the Dem side, this is from another US politics media source, Politico reporter tweet:

• „Democrats in the White House and on Capitol Hill say negotiations are going in the wrong direction“
• „They say Republicans’ demands keep going further to the right.“

—-

Biden is meeting with Japan, South Korea, and then separately with Ukraine President Volodymyr Zelensky on Sunday (Japan time). Biden will hold a media conference later in the day. He’ll be back in Washington for more debt talks, likely from Monday although he could arrive back on Sunday evening USA time.

—

US House Speaker Republican McCarthy & US President Biden.

This article was written by Eamonn Sheridan at www.forexlive.com.

• Ding. Ding. Ding. Stocks close lower as debt ceiling talks stall.
• ECBs Lagarde: We should not trade-off price stability and financial stability
• US 2 year yield has the biggest gain since September 2022
• Jake Sherman: Nothing to report from Washington
• WTI Crude oil settles at $71.55
• Gold rebounds toward its 100 hour moving average today
• German DAX closes at the highest level on record
• Bakers Hughes oil rig count falls 11 to 575
• House Majority Leader McCarthy: yesterday I really felt we had a path to an agreement
• ECB’s Schnabel:Wage growth has picked up substantially.Concerns about second-round effects
• White House: Both sides need to recognize they will get everything they want in a deal
• Fed Powell summary: Inflation is still too high, but risk is more balanced.
• GOP debt negotiators : White House is not being reasonable.
• Fed Powell: Inflation is far above that objective
• ECB Schnabel: ECB can continue to do whatever needed to bring inflation back to 2% target
• US imposes new sanctions against Russia
• Feds Bowman: No monetary policy or economic comments
• Feds Williams: No comments on monetary policy or economic outlook from NY Fed President
• Canada retail sales March -1.4% versus -1.4% expected
• German DAX trades to a new record high
• The NZD is the strongest and the USD is the weakest as the North American session begins
• ForexLive European FX news wrap: Light dollar pullback ahead of Powell

The negotiations to raise the U.S. debt ceiling were put on hold. Dems pointed the finger at the GOP. The GOP pointed the finger at the Dems. Pres. Biden comes back from the G7 over the weekend, and I am sure both sides, know what is at stake. Nevertheless, the development alarmed market participants as they headed into the weekend. Initially, yields moved off high levels as focus was on expected lower growth. The dollar moved lower. Gold rebounded. Stocks slid. However, moves were somewhat limited.

Meanwhile (and at the same time), Fed’s Powell was participating in a panel discussion with former Fed Chair Bernanke. Powell picked his words closely and covered most bases in the process. Powell suggests that due to tightening bank credit conditions, policy rates might not need to rise as high as might otherwise be expected. Nevertheless, he notes that market pricing suggests a different rate path than the Fed, presumably anticipating a more rapid decrease in inflation. However, he maintains that current data support the view that reducing inflation will take time. He also highlights the inclusion of risk compensation in market prices (lowering rates below what even analysts expect). Finally, Powell states that while the Fed has not yet determined whether rates are sufficiently restrictive (inflation is still too high), the objective is to reach a sufficiently restrictive policy stance. The Fed hasn’t decided on how much more tightening might be necessary, but Powell suggests that the balance between doing too much and too little is becoming more evenly balanced.

After the dust settled, and the events were over, the US stocks are ending the day modestly lower. Yields are ending higher, but close to the middle of the ranges. The USD is ending the day as the weakest of the majors (despite higher rates) but off the lowest of levels.

Looking at the strongest to the weakest rankings, the NZD and the CHF are ending as the strongest of the majors. The USD and the CAD are the weakest.

For the trading week, the USD is closing mixed with the USD moving the most to the upside vs the JPY, but falling vs the NZD. The USDs changes showed:

• EUR +0.40%
• JPY, +1.51%
• GBP +0.06%
• CHF +0.11%
• CAD, -0.46%
• AUD, -0.09%
• NZD – 1.37%

The price of oil rose 2.61% which benefitted the CAD (the USD fell -0.46% vs the CAD). Gold meanwhile fell -1.67% this week. The move lower did not hurt the AUD (it ended little changed vs the greenback). The USD rose modestly versus the EUR by +0.40%. Overall, the dollar index (DXY) rose by 0.47%.

For US stocks this week:

• Dow rose 0.38%
• S&P rose 1.65%
• Nasdaq rose 3.04%.

In the US debt market, yields moved higher this week with the 2-year having its biggest week move since September 2022. The 10-year is ending the week up the most since February.

This article was written by Greg Michalowski at www.forexlive.com.

The major US stock indices are ending the day lower. The excuse will be the debt ceiling talks stalling (for now), but if there was a lot of worry, the stock market would be down much more.

Technically, however, the S&P index could not close above the 4200 natural level (it is closing at 4191.99), nor could the price of the S&P close above its 100-week moving average at 4201.1. Close but no cigar. That could be problematic from a technical perspective. It will take a move above the 100-week moving average next week to give the buyers more ammunition for further upside probing. Absent that and we could be in store for a corrective week.

Although closing lower, the major indices are closing higher in the week.

The final numbers are showing:

• Dow industrial average -109.30 points or -0.33% at 33426.64.
• S&P index -6.07 points or -0.14% at 4191.99
• NASDAQ index -30.95 points or -0.24% at 12657.89

For the trading week, the major indices are closing higher:

• Dow industrial average eked out a 0.38% gain.
• S&P index close up 1.65%
• NASDAQ index was the beginner with a 3.04% rise

Big winners included AI stocks:

• Nvidia up 10.31%
• Alphabet +4.48%
• Microsoft +3.03%

Another AI stock, Adobe rose 3.05% today and was up 10.73% on the week. Adobe will announce its earnings on June 15. Nvidia will announce its earnings next Wednesday after the close. Both earnings will be important in the short term for the AI euphoria.

The KRE Etf of regional banks closed lower on the day by -1.78%, but was still up 7.81% on the week on less banking fear. Neverthless, Treasury Sec. Yellen did warn that there may be more consolidation in the banking sector, and that reversed earlier gains.

PS. Technically, the KRE price tested the 200-hour MA at the highs today (at $40.36 – green line) before rotating lower. That did not help as the recent price history shows, the 200 hour MA is a level for sellers to lean against. However, the price is closing above the 100-hour MA at $37.88. The price is in a neutral area technically between the 100 and 200 hour MAs.

This article was written by Greg Michalowski at www.forexlive.com.

ECB’s Lagarde is speaking and says:

• ECB will do what is necessary to deliver price stability
• We should not trade-off price stability and financial stability
• We can successfully pursue both goals at the same time

Nothing new here

This article was written by Greg Michalowski at www.forexlive.com.