Weak sales data in the US housing market yesterday hurt again the American dollar, and failed to strengthen its position against the euro and the pound in the afternoon. All attention was focused on the speech of the Fed chairman Jerome Powell, who also did not particularly help the dollar. We will talk about this in more detail based in yesterday's review.
According to the report of the National Association of Realtors USA, sales in the US secondary housing market in May this year fell again. It happened because of the jump in prices, as well as the price increase to credit money access after the Federal Reserve approved interest rate hikes. Also, the weak spring season of purchases could affect the decline in sales.
The report further indicates that sales in the secondary housing market in May decreased by 0.4% compared to the previous month and amounted to 5.43 million homes per year. Economists had expected sales to rise to 5.54 million homes a year. In comparison with the same period of the previous year, sales in May fell by 3%.
Yesterday, it was reported that the European Union will not hesitate to retaliate against the US decision to impose tariffs on steel and aluminum imported from Europe.
The reciprocal tariffs on the import of goods from the United States into the EU will begin to operate tomorrow. As noted in the statement of the European Commission, the tariffs will be exported from the US goods worth 2.8 billion euros, but this list will be expanded to 6.4 billion euros in the future. The fee will be 25% and will apply to all goods produced in the US, including whiskey and motorcycles.
As for the technical picture of the EUR/USD pair, it remained unchanged.
Buyers of risky assets still have a good chance to regain their advantage, but it gradually melts. To form an upward movement in the euro, it is necessary to return to the resistance area of 1.1600, where the demolition of stop-orders of sellers will lead to a larger upward trend in euros, with an update of weekly highs in the resistance range of 1.1650 and 1.1690. Meanwhile, it's impossible to get to 1.1600 as the pressure on the euro is increasing. A breakout of 1.1550 could lead to a larger sale to the area of new lows of 1.1510 and 1.1450.
Quotes of oil slightly increased yesterday after the publication of a report from the Energy Information Administration of the US Department of Energy. The report showed a decrease in oil reserves last week by 5.9 million barrels. Economists had expected a reduction in stocks of only 2.5 million barrels.
However, more attention is focused on the OPEC meeting. In the evening, the Saudi Energy Minister said that it is time to change course in accordance with market conditions, which is an increase in oil production. According to the minister, there is time to discuss the volumes of production required by the market, and any decision to be made is based on fundamental factors and data.
* The presented market analysis is informative and does not constitute a guide to the transaction.
