May 2017 Market Overview
$Us Dollar: The month started with improved ISM Non- Manufacturing PMI and Non-Farm Employment Change, ADP Non-Farm Employment Change and ISM Manufacturing PMI came below expectations. Fed kept interest rates on hold. Average Hourly Earnings m/m came in line, Unemployment Claims reduced and Unemployment Rate down to 4.4%. PPI m/m increased to 0.5% above expectations while CPI m/m, Core CPI m/m, Retail Sales m/m and Core Retail Sales came disappointing. Mid-month saw disappointing Building Permits and improved Unemployment Claims. Core Durable Goods Orders m/m came below, Preliminary GDP q/q above expectations. The month ended with CB Consumer Confidence below expectations.
USD Index formed Head and Shoulder, now broke through the neckline and retracing back to 20 EMA.
CNY: The month started with disappointing Caixin Manufacturing PMi, Trade Balance came well above expectations at 262B while Industrial Production y/y disappointed.
EurUsd: Final round of Presidential French Election temporarily sent Eur down which was followed by a soaring rally. German Ifo Business Climate came above expectation.
EurUsd: Formed reversed Head and Shoulder with neckline aligned with monthly horizontal. Now broke through the neckline, retesting 20 Ema in the upward move following some 430 PIPs rally this month.
GbpUsd: The month started with improved Manufacturing, Services and Construction PMI. Manufacturing Production m/m came well below expectations. Interest rate remained on hold. CPI y/y came at 2.7%, above expectations as did Retail Sales. Average Earnings Index 3m/y remained unchanged. Second estimate GDP q/q disappointed.
GBPUSD: broke out in April of the established Range since Oct 2016, now bouncing on the top of the Range and 50& 200 EMA .
AudUsd: The month started with interest rate on hold and disappointing Trade Balance and Retail Sales. Employment Change and Unemployment Rate came well above expectations.
AudUsd continues it’s dance within a range, now broke out of the established channel and retesting the trendline and the monthly horizontal.
Week ahead in the News
USD: ISM Manufacturing and Non-Manufacturing PMI, ADP Non-Farm Employment Change, Non-Farm Employment Change, Unemployment Rate, FOMC meeting Minutes, Average Hourly Earnings m/m and Crude Oil Inventories.
CNY: Caixin Manufacturing PMI; GBP: Manufacturing, Construction and Services PMI, AUD: Cash rate, RBA Rate Statement; Trade Balance, Retail sales; CAD: Trade Balance, Employment Change, Unemployment Rate.