News & Analysis

US Stocks flat; Europe Lower; EURUSD closes below 1.6000; Oil backs down from $57.80

Nov 8, 2017 | Daily Market Outlook

Today’s high impact news:

02:30 USD Crude Oil Inventories

07:00 NZD RBNZ Rate Statement

08:00 NZD RBNZ Press Conference

In lackluster trade, US indices finished mixed. Europe had a bad night with falls on the FTSE and DAX. The EURUSD closed below 1.6000, it’s the lowest close since July. After testing $57.80 oil buyers took a breather as price returned to $57.00.

In the US the Dow Jones added 8.81 points, the S&P500 lost 0.49 and the NASDAQ closed lower by 18.65 points. Trade was quiet, traders looked to earnings for direction. The market’s rally can be traced back to just after the U.S. presidential election last year. Since Nov. 8, 2016, the indexes are up at least 20 percent. “The question now most likely on investors’ minds is: ‘How long will this ride last?'” said Sam Stovall, chief investment strategist at CFRA Research. “History suggests longer than we would expect. On average, the S&P 500 continued sailing along for another year after the conclusion of a president’s first year since being elected before slipping into a new decline of 10% or more.”

Wondered how the Trump rally stacks up to previous President’s rallies? Chart 1. Shows best and worst first 250 days in market gains after a President takes office. Chart 2. How they stack up, best to worst terms for the first 250 trading days after each election.

In Europe, shares closed lower, the DAX the worst of the major indices losing 89.52 points. The FTSE lost 49.17 points. The Euro traded mixed overnight trading back at July lows to the USD but increasing to NZD and AUD. The USD climbed to the JPY and CAD and pushed the AUD lower to retest its .7624 support level. The GBP traded higher to the JPY and CHF. It followed suit trading lower to the USD but staged a late NY session fight back to pare 58 pips in loses to finish slightly lower. There where central bank speeches overnight but no real surprises market wise emerged.

Gold continues to trade directionless as it gave up early gains to settle $7.80 lower.  A range has set up on the daily chart between – $1265.46 and $1282.64. Oil retreated from a new 2017 $57.80 high to settle 34 cents lower.

EURUSD  – sellers controlled the session with a 54 pip move lower that tested the 1.1574 level. Buyers reacted, taking control late in the NY session to force a close off lows and taking price back above 1.1574 support. Regular divergence has developed, we would like to see price remain above 1.1574 with a higher close today to show buyers are gaining control as overall sellers still look to be in control.

Good trading from Eightcap.

Sources; Reuters, CNBC, Yahoo

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