Summary:
- US500 retests 200 day SMA after further declines
- Oil drops to test support following DOE inventory build
- Turkish Lira makes a U-turn after CBT decision
- Crypto markets plunge lower with double-digit declines
- ECB in focus tomorrow
Tuesday’s session saw some pretty large scale selling in indices, but today’s trade has been relatively subdued so far. The US500 has declined a little further before finding some support around the European cash close. The market has once more revisited it’s 200 day SMA and proponents of this trend identifier will be watching closely going forward to see if the bulls can defend it once more.
It’s been a volatile couple of hours for Oil traders, with the price swinging following the latest DOE report. The data itself showed an unexpected build and coupled with a fairly large increase in US output (+46K) it is not too surprising the initial reaction was to the downside. Prior support at 67.30 held for Oil.WTI and it appears that longs won’t go quietly, with the prevailing uptrend remaining in tact.
An in-depth technical overview of the market can be found here.
The Turkish central bank lifted its late liquidity lending rate by 75 basis points to 13.25% exceeding the median estimate pointing to a 50bps increase. Other rates (repo, borrowing and lending O/N) were left unchanged in line with economists’ expectations. The TRY jumped in a knee-jerk response to the verdict, but it has retraced some of its gain thereafter.
There’s been some sizable declines seen in the crypto space today, with alt-coin taking the brunt of the hit and declining more than 10%. Ripple is the worst individually and is currently off by more than 15%. There’s little by the way of a clear fundamental reason for the selling, although comments from the former Paypal CEO in which he called the markets ” a colossal pump-and-dump scheme” are unlikely to have helped.
Tomorrow sees one of the main events of the week with the ECB meeting concluding with the interest rate announcement at 12:45 (BST) and the Draghi press conference at 1:30. EURUSD is at a very interesting level heading into this event, probing long-term support and any dovish surprised could lead to a major break lower. A full preview can be found here.