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U.S. Dollar Higher for a Second Day

by Archer Financial Services | May 14, 2020

By Alan Bush | Senior Financial Economist at ADMIS   
 

STOCK INDEX FUTURES

Stock index futures traded lower yesterday with follow-through today after cautious comments about the global economy from U.S. Federal Reserve Chairman Jerome Powell. 

Mr. Powell said further stimulus could be needed to support the economy's recovery.    

Jobless claims in the week ended May 9 were 2.981 million when 2.700 million were expected.

Some recovery is likely for stock index futures from the current lower levels.
 

CURRENCY FUTURES

The U.S. dollar is higher for a second day after President Trump said he would prefer a stronger dollar to accompany the economic recovery. 

The British pound is lower after Bank of England Governor Andrew Bailey said Britain’s economy may suffer long-term damage.

The Japanese yen is lower despite a report that Bank of Japan Governor Haruhiko Kuroda said he saw no immediate need to deepen the bank's negative interest rate policy. Mr. Kuroda said while the bank's current short-term interest rate target is minus 0.1%, there is still "substantial room" to cut further. However, it was not necessary to do so at this point. 

The Australian dollar is lower after it was recently reported that Australia’s economy lost 594,300 jobs in April, which is worse than the 575,000 expected. Full time employment was down by 222,500 with 373,800 part time jobs lost. 

INTEREST RATE MARKET FUTURES 

Some flight to quality buying is coming into the long end of the curve in light of lower stock index futures.

Federal Reserve speakers today are Neel Kashkari at 12:00, Raphael Bostic at 2:00 and Robert Kaplan at 5:00.

Supply remains an issue with the Treasury to auction 20-year bonds next week. 

The 30-year Treasury bond futures remain in a broadly based congestion pattern as the main fundamental influences affecting the long end of the curve are offsetting. 

SUPPORT & RESISTANCE


June 20 S&P 500
Support    2775.00    Resistance    2828.00 

June 20 U.S. Dollar Index
Support    100.120     Resistance    100.650

June 20 Euro Currency
Support    1.07750     Resistance    1.08380 

June 20 Japanese Yen
Support    .93250        Resistance    .93770

June 20 Canadian Dollar
Support    .70740        Resistance    .71180 

June 20 Australian Dollar
Support    .6400           Resistance    .6478

June 20 Thirty Year Treasury Bonds
Support    180^10       Resistance     182^0

June 20 Gold
Support    1714.0         Resistance    1738.0 

July 20 Copper
Support    2.3100         Resistance    2.3650  

July 20 Crude Oil
Support    25.48            Resistance    27.34

 



For more information about these markets, please contact Alan at 312.242.7911  or via email at alan.bush@admis.com. Thank you.

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Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The risk of loss in trading futures and options can be substantial. The views and opinions expressed in this letter are those of the author and do not reflect the views of ADM Investor Services, Inc. or its staff.  Research analyst does not currently maintain positions in the commodities specified within this report. The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright © ADM Investor Services, Inc.

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