Global macro overview for 29/06/2018

Wall Street on Thursday was still influenced by the increasing prospects of a full-blown trade war. In the morning, European exchanges were optimistic that only the half-finished window dressing could justify. Then it was much worse. European indices lost more than on Wednesday, and indices of emerging markets (especially Asian) continued to look very bad. The question was whether there would be a pretext in the US, but to raise the indexes at the end of the first half of the year.

As usual, on Thursday, a weekly report from the labor market was published in the USA. Traders learned that in the last week 227,000 new applications for unemployment benefits were submitted (220,000 were expected). The average of four weeks for these data decreased slightly.

There was also a report on the increase in US GDP in the first quarter, but this was already the second revision, so the market reaction was negligible. Let us note that GDP increased by 2.0%, and not as expected by 2.2%, so the global investors have right to fell a little disappointed.

Wall Street started the session very uncertainly. Normally, after the end of the session in Europe, the bull camp attacked, but after another 90 minutes, the indices returned to the vicinity of the neutral level. Then, again, more convincingly, they started to move higher. The increase in the price of oil and more expensive shares in the financial sector helped the bulls. The reason was the approaching date of the second phase of stress tests carried out by the Fed (as if it did not have obvious that everyone would pass them). It also helped that there was no new information about trade wars, which gave the opportunity to create a slow window dressing. Finally, the SP500 index gained 0.62% at the end of the day.

In conclusion, there are still no new highs at the SP500 index, but there are some other markets, like NASDAQ, that are making all-time highs again. Nevertheless, the most of the indices are still trading in the middle of the range established after the sell-off from the beginning of the year. This situation might continue towards the next quarter as well.

Let's now take a look at the SP500 technical picture at the H4 time frame. The price is trading around the level of 268.00 after the price was rejected at the technical resistance at the level of 273.42. The momentum remains weak, but the RSI is pointing to the north, which might suggest the continuation of the horizontal consolidation between the levels of 267.00 - 274.15.

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