The major pairs including the euro and pound had a pretty smooth move this past week, as they gave their bearish correction earlier this week and then continued their bullish run the latter 3 days where they managed to break their previous highs made last week.
Talking about the euro, the German economic sentiment, prelim GDP of Italy and France, followed by the Flash GDP of the overall Eurozone, all came out to be impressive that led to build up the investor confidence in the currency, hence taking the pair to test a new top of 1.3400.
Similarly, the Claimount Count Change data was good that was followed by another positive result of retail sales data which grew by 1.1% in the U.K. economy against the expected 0.7% figure. The British pound tested the 1.5652 resistance level on Thursday and Friday, that is its new high after several weeks.
As far as the USD is concerned, it remained under pressure against the major currencies and as well as gold, because the key economic indicators including the Philly Fed manufacturing index, capacity utilization, consumer sentiment, all disappointed the USD investors.
Gold also got out of its range area from 1313 and achieved its 1375 resistance level that was stated in our previous reports. Currently, the metal is in a short-term bullish zone where it may go on to test the 1382 and 1403 resistance level if it manages to sustain above the 1375 resistance level.
U.S. Stock Market
Talking about the U.S. stock market, it fell drastically on Thursday where the S&P 500 index fell from the 1380s region down to 1359, after which it has made a double bottom at the 1353 support level. This came in result of the impressive figures of unemployment claims that fell last week, hence indicating towards the betterment of the labor market.
Considering this event, the investors are wary about the tapering of the bond buying measures very soon as the overall economic condition in the United States seems to be improving. However, the sellers are still intact in the stock market and would love to sell on tops that mean every bullish correction that the market gives is a good opportunity for the sellers to go short with tight stop losses.
To contact the reporter of this story: Jonathan Millet at email@example.com