Tracking Unemployment on All Continents

Fundamentals

Yesterday traders were watching for news on the change in the number of jobless claims in the UK. The number of claims grew substantially compared to the forecast – 19,400 versus 7,500.
This number had a positive effect on Britain’s pound sterling. Currency traders apparently rated the probability of BoE interest rate hike at the next meeting as high. Indeed, the market digested the news rather quickly, and 7 hours later the pound had lost almost all the ground it had gained.
US crude oil and refinery product inventories shrank by 1.753 million barrels, which had a positive impact on the cost of the black gold. Brent crude added about 150 points yesterday.
Today at 1:30 am GMT Australia is expected to release its unemployment figures. The level is expected to be 5.9%.
A bit later, at 12:30 pm GMT, data on the number of initial jobless claims will be published in the United States. We’d advise listening at 5:00 pm GMT to the speech by ECB President Mario Draghi.

Stocks

The report from Wal-Mart Stores should attract notice among corporate news on Thursday. Profit per share is expected to be around $0.96.
On Wednesday, May 17, 2017, the US stock market gapped down by more than 100 points, opening at 20,846.17 points. The industrial index therefore closed the April 25, 2017 gap. You’ll recall that we already wrote about a possible island gap that might knock the bulls out of their positions. The gap from April 24, 2017 is on its way. The Dow Jones might end up near 20,600.
We recommend paying attention to Apple shares. They reversed. As we noted already, on the weekly chart the support for the shares could be at $140.60, which is fairly low. It goes without saying that trading down requires additional confirming signals, so the advice to bears is to be extremely careful, building positions only after confirmations.

Currency Market

As we noted yesterday, the AUD/CAD pair has started to consolidate. We won’t rule out that the bulls are preparing a counterattack. This is confirmed by the rise in the MACDF and the convergence of the price chart with the Parabolic SAR. Naturally, a different scenario – the formation of a head-and-shoulders pattern – is possible. In this case, however, we’d need confirmation in the form of a breakthrough of the neckline at about where the currencies are at parity.
The bulls failed to counterattack the GBP/CHF pair. As we said yesterday, the Directional movement indicator did its work. The bears pushed the pound a little lower. For now, we’re confirming a possible target of 1.2660, where a 50% Fibo correction is located. This is about where the 1:1 Gann fan is and, in the event of a breakthrough, it may indicate a reversal of the short-term trend and the full-blown arrival of the bears. By the looks of it, traders will prefer trading down to this boundary, after which they might switch positions in the hope that buyers will come back to the pair.

Nikolay Dudchenko, Olymp Trade analyst.

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