EURUSD TECHS: Pierces The 20-Day EMA
* RES 4: 1.1633 Trendline resistance drawn from the Apr 17 high * RES 3: 1.1552 50-day EMA * RES 2: ...
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OIL: Crude More Cautious This Week On Likelihood Of US-Iran Deal
Oil has started Wednesday higher following reports of a strike at Iran’s Qeshm Island and sirens triggered in Kuwait & Bahrain. President Trump has made numerous assurances that there will be an agreement soon to reopen the Strait of Hormuz but yet it remains closed. Optimism drove oil prices lower in May but this week they are a lot more cautious and are higher again. Comments from the US and Iran continue to give different messages.
- Despite Trump saying there could be a US-Iran MOU within the week, there is persistent ongoing heightened uncertainty on how talks are progressing. Key sticking points on control of Hormuz, enriched Uranium, sanctions and frozen Iranian assets remain.
- WTI rose to a high of $96.08 on reports of new hostilities in the Middle East but then moderated to trade around $94.50/95.00. It is currently up 1.2% to $94.86/bbl.
- Brent is up 1.1% to $97.07, just off the intraday high at $97.28. It fell to $96.44 early in the session.
- Bloomberg reported a 6.8mn barrels crude US inventory drawdown last week, according to an API document. It appears that some of the oil was refined into gasoline as stocks of the product rose 3.5mn but distillate fell 214k. The official EIA data is published Wednesday.
- Later the Fed’s Barr & Logan and ECB’s Elderson & Cipollone appear. The Fed’s Beige Book is also published. In terms of data, US May ADP employment, May services ISM/PMI, April durables, European services/composite May PMIs and April euro area PPI print.
LOOK AHEAD: Eurozone Timeline of Key Events (Times BST)
| Date | Time | Country | Event |
| 03-Jun | 0815 | ES | S&P Global Services & Composite PMI |
| 03-Jun | 0845 | IT | S&P Global Composite & Services PMI |
| 03-Jun | 0850 | FR | S&P Global Composite & Services PMI (f) |
| 03-Jun | 0855 | DE | S&P Global Composite & Services PMI (f) |
| 03-Jun | 0900 | EU | S&P Global Composite & Services PMI (f) |
| 03-Jun | 1000 | EU | EZ PPI |
| 03-Jun | 1050 | EU | ECB Elderson Keynote at GS Euro Financials Conference |
| 03-Jun | 1430 | EU | ECB Cipollone Statement at Digital Euro Hearing |
| 04-Jun | 0800 | ES | Industrial Production |
| 04-Jun | 0830 | IT | S&P Global Italy Construction PMI |
| 04-Jun | 0830 | DE | S&P Global Germany Construction PMI |
| 04-Jun | 0830 | EU | S&P Global Eurozone Construction PMI |
| 04-Jun | 0900 | EU | ECB Lagarde Speech at Women's Network Event |
| 04-Jun | 1000 | EU | EZ Retail Sales |
| 05-Jun | 0745 | FR | Industrial Production / Foreign Trade |
| 05-Jun | 1000 | EU | EZ GDP 3rd (Regular) |
| 05-Jun | 1000 | IT | Retail Sales |
| 08-Jun | 0700 | DE | Manufacturing Orders |
EURUSD TECHS: Shallow Correction
- RES 4: 1.1857 High Feb 18
- RES 3: 1.1797/1849 High May 06 / Apr 17 and the bull trigger
- RES 2: 1.1717 Top of a bear channel drawn from the Apr 17 high
- RES 1: 1.1686 High May 29
- PRICE: 1.1626 @ 06:17 BST Jun 3
- SUP 1: 1.1553 Base of a bear channel drawn from the Apr 17 high
- SUP 2: 1.1505 Low Apr 6
- SUP 3: 1.1443 Low Mar 30
- SUP 4: 1.1411 and a key supportLow Mar 13 and 16
The recent shallow recovery in EURUSD appears corrective. Resistance at 1.1670, the 50-day EMA, has been pierced. A clear break of it would signal scope for a stronger recovery and expose bear channel resistance at 1.1717. The channel is drawn from 1.1849, the Apr 17 high. Attention is on 1.1603, a 1.00 projection of the Apr 17 - 30 - May 6 price swing, and 1.1557, the bear channel base. A break of both levels would strengthen a bearish threat.
