Closing changes in the main European bourses:

• Stoxx 600 -0.6%
• German DAX -0.35%
• UK FTSE 100 -0.4%
• French CAC -0.4%
• Italy MIB -0.9%
• Spain IBEX -1.0%

On the week:

• Stoxx 600 +0.9%
• German DAX +1.1%
• UK FTSE 100 +1.6%
• French CAC +1.8%
• Italy MIB +2.1%
• Spain IBEX +0.5%

These are some nice weekly numbers but they come after a battering on political worries.

This article was written by Adam Button at www.forexlive.com.

USD/JPY bulls are playing with fire.

The pair is up for a seventh straight day after a surprisingly strong US services PMI. The reading of 55.1 is a 26-month high and well above the 53.7 consensus.

The report sparked broad US dollar buying and has pushed USD/JPY closer to the 160.00 line in the sand. That’s where the Japanese Ministry of Finance last intervened, sending the pair plunging as low as 151.85.

I close here would be a fresh 34-year closing high in the pair. Yesterday, I wrote about five reasons that the pair had been climbing.

The last time, officials allowed for a brief break of 160.00 before stomping on the market. There is a chance they could allow it to break those intraday highs or run to 165.00 before stepping in. The official lines are that they’re not setting price levels but want to avoid disorderly moves.

This article was written by Adam Button at www.forexlive.com.

The AUDUSD this week traded down to test a swing area between 0.6575 and 0.6590. The subsequent move to the upside then tested the high of a swing area between 0.6677 and 0.66896 (see the chart below).

Staying with the confines of the “red box” where most of the trading has taken place over the last 6-7 weeks keeps the ups and downs as the favored trading strategy.

The price decline off the high has now reached the 100 and 200-bar moving averages on the 4-hour chart. Both those moving averages are near converged at 0.6638. They also represent the bias-defining level between the extremes.

Moving below the moving averages now would tilt the technical bias more in favor of the seller’s with the low of the trading range as the next key targets (low of the red box).

Staying above the moving averages keeps the buyers more in control, and the door open for a retest of the high of the trading range (high of the red box).

At some point the red box will be broken and remain broken as market traders figure out the next trend-like move. For now buyers and sellers are happy to trade the range.

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

• Prior was 4.10m
• Inventory at 3.7 months vs 3.5m prior
• Median price +5.8% from May 2023 at $419.3K
• Sales down 0.7% m/m

This article was written by Adam Button at www.forexlive.com.

• Prior month -0.6%
• Leading index for May -0.5% versus -0.3% estimate.

There have only been one positive reading since April 2022. The data will predict the recession one day.

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

Today’s snapshot of the US stock market

Today’s trading session highlighted a distinct divergence in market sector performance, with technology generally outpacing other areas, although noteworthy declines were observed in the semiconductor subsector.

📉 Semiconductor Sector Analysis

A significant red zone in today’s heatmap is unmistakably the semiconductor sector, led by a sharp 3.04% fall in Nvidia (NVDA) and a modest decline in Qualcomm (QCOM) by 2.32%. This drop comes amidst rising concerns over supply chain disruptions and potentially softening demand in global markets.

🌟 Technology and Consumer Electronics Gain Ground

Contrastingly, Microsoft (MSFT) and Adobe (ADBE) showed resilience, posting gains of 0.38% and 0.78%, respectively. Apple (AAPL) also climbed by 0.55%, indicating robust performance in the software infrastructure and consumer electronics space. These upticks suggest a growing investor confidence in tech stalwarts, likely driven by strong quarterly performances and market expansions.

💼 Financial Sectors and Major Indices

The financial sector showed mixed results with JPMorgan Chase (JPM) dipping by 1.08%, whereas Visa (V) had a slight drop of 0.28%. These movements might reflect market reactions to recent policy changes or economic forecasts.

🚀 Outperformers of the Day: Google and Amazon

Google (GOOG) and Amazon (AMZN) stood out from the crowd, registering increases of 0.76% and 0.83%, respectively. These gains reflect positive investor sentiment in the internet content and retail sectors, potentially buoyed by optimistic growth forecasts and strategic e-commerce expansions.

📈 Strategic Recommendations

Given today’s sector disparities, investors should consider rebalancing their portfolios towards technology, especially firms showing strong fundamentals and growth potential. Caution is advised for those heavily invested in semiconductors, as further analysis is required to navigate the ongoing volatility.

For real-time updates and more nuanced analysis, keep checking ForexLive.com.

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

The USDJPY has lifted back to the upside and is back above the 159.00 level after the stronger-than-expected S&P/global manufacturing and services index flash data. The high price traded up to 159.206. That gets it to 100 pips short of the 2024 high price at 160.208. That I was the highest level going back to 1991 the price high reached 160.40.

Looking at the 5- minute chart below, the price has been trading above and below its 100 and 200-bar moving averages in trading today.

However, the last two dips did find support buyers against those moving averages at 158.916. That increases the levels importance going forward at least in the short term.

As long as the price can stay above the short-term bias is more bullish. If the price moves below be prepared for buyers turning to sellers in the short term at least.

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

The major US indices are trading little changed ahead of the flash PMI data and the existing home sales.

• Dow Industrial Average averages up 2.0 points or 0.01% at 39141
• S&P is down -6.5 points or -0.13% at 5466.06
• Nasdaq is down -15.48 points or -0.09% at 17706.37

The small-cap Russell 2000 is trading down -4.51 points or -0.22% at 2012.88.

In the US debt market ahead of the data ahead”

• 2-year yield 4.698%, -3.1 basis points
• 5-year 4.230%, -3.6 basis points.
• 10-year 4.220%, -3.3 basis points.
• 30-year 4.360%, -3.3 basis points

The S&P global flash manufacturing index estimate for June is expected at 51.0 versus 51.3 last month.

The services flash is expected of 53.7 versus 54.8 last month.

At 10 AM ET, existing home sales are expected at a annual pace of 4.10M versus 4.14M last month

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

• 26-month high
• Prior was 54.8
• Manufacturing 51.7 vs 51.0 expected
• Prior manufacturing was 51.3
• Composite 54.6 vs 54.5
• Selling prices ‘at one of the lowest levels of the past four years’ and a five-month low
• “Improved business confidence for the year ahead, notably
  in the service sector, as well as renewed pressure on
  operating capacity from rising demand”
• Services future prospects hit a five-month high
• Service sector payrolls rose to the
  greatest extent for five months, helping reverse some of
  the declines seen in the sector over the prior two months

The services number is above the highest economist estimate and points to an economy that’s strong and resilient. However the pricing numbers are also moving in the right direction and that could limit the hawkish reaction.

Chris Williamson, Chief Business
Economist at S&P Global Market Intelligence said:

“The early PMI data signal the fastest economic expansion
for over two years in June, hinting at an encouragingly
robust end to the second quarter while at the same time
inflation pressures have cooled.
The PMI is running at a level broadly consistent with the
economy growing at an annualized rate of just under 2.5%.
The upturn is broad-based, as rising demand continues to
filter through the economy. Although led by the service
sector, reflecting strong domestic spending, the expansion
is being supported by an ongoing recovery in
manufacturing, which so far this year is enjoying its best
growth spell for two years.
The survey also brings welcome news in terms of job
gains, with a renewed appetite to hire being driven by
improved business optimism about the outlook.
Selling price inflation has meanwhile cooled again after
ticking higher in May, down to one of the lowest levels seen
over the past four years. Historical comparisons indicate that the latest decline brings the survey’s price gauge into
line with the Fed’s 2% inflation target.”

Prices:

This article was written by Adam Button at www.forexlive.com.

US stock futures are fractionally lower but all eyes are on Nvidia today as we hit quad witching. Shares are down 2.9% in the premarket after hitting a record early yesterday and then reversing to finish 3% lower.

This article was written by Adam Button at www.forexlive.com.