The price of crude oil rose even after the latest decision by OPEC and its partners pledged to boost production. They will increase production by 650k barrels a day in July and August. This is higher than the 400k barrels per day that the cartel has been hiking in the past few months. The decision came a few days after the EU agreed to impose a ban on Russian oil imports. It also came a day after Saudi Arabia said that it will be open to hike production depending on Russia’s supply. Oil also rose after the EIA published a sharp drawdown of oil inventories. They declined by more than 5 million, which was higher than the median estimate of a 1.3 million drawdown.
The US dollar retreated slightly ahead of the upcoming official jobs numbers by the Bureau of Labor Statistics. Economists expect the data to show that the country created 325k jobs in May from the previous 406k. They also see the unemployment rate falling from 3.6% to 3.5%. The most important data to watch will be wages considering that inflation has surged. On Thursday, data by ADP showed that the private sector added just 128k jobs. On the other hand, data by the BLS showed that initial jobless claims declined to 200k.
American stocks moved sideways after Jamie Dimon of JP Morgan warned that the country’s economy faced a hurricane in the coming months. He cited the ongoing inflationary pressures in the country and the slowdown in hiring. Stocks also reacted to the latest earnings and revenue guidance by Microsoft. The company said that it expects its fiscal fourth-quarter sales to be $51.94 billion and $52.4 billion. This was lower than the previous range of between $52.4 billion and $53.2 billion. The company cited the lower guidance to the strong US dollar. This means that the company’s foreign earnings will be lower when converted to the US dollar.
The Nasdaq 100 index rose to a high of $12,780 from this week’s low of $12,400. On the four-hour chart, the index is above the descending channel shown in blue. It managed to cross the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has moved close to the overbought level. Therefore, the index will likely keep rising as bulls target the resistance at $13,000.
The EURJPY pair rallied to a high of 139.36 after the strong EU PPI data. It rose to the highest level since April 21st. It rose above the important resistance level at 136.78 and the ascending trendline shown in white. It also rose above the 25-day moving average while the Relative Strength Index (RSI) has moved above the overbought level. The Average Directional Index has kept rising. Therefore, the pair will likely continue rising.
The EURUSD pair continued rising ahead of the upcoming US NFP data. It is trading at 1.0737, which is above the important support at 1.0615. The MACD has moved slightly below the neutral level while the RSI has moved above the neutral level at 50. The pair will likely keep rising ahead of the US jobs data, with the next key resistance being at 1.0790.
Source: OctaFX Analyst Team