April Showers on U.S. Home Sales

Wells Fargo Research Team Wells Fargo

U.S. Review

April Showers on U.S. Home Sales

New and existing home sales each declined in April. New home sales are up 8.4 percent year-to-date as demand remains solid. The average time for homes on the market has declined by three days compared to last year. Rising mortgage rates and home prices could test buyer resolve, however.
Durable goods orders disappointed the consensus, falling a greater-than-expected 1.7 percent. A pullback in aircraft orders was the main drag, as core orders rose 0.9 percent. Consumer sentiment fell again in May, but overall consumers remain upbeat about economic conditions.

Global Review

Global Economy Shows Mixed Results at the Start of Q2

According to recently released data, Q2 started with mixed results after a relatively weak first quarter. Although data on consumption seem to have picked up a bit at the start of Q2, data on production seemed to have continued to weaken from the highs seen at the end of 2017.
U.K. retail sales increased 1.6 percent sequentially in April, the strongest monthly print since the 2.5 percent increase recorded in April of last year. In the Eurozone, the manufacturing sector continued the weakening trend it has shown since December 2017 as the Markit/BME manufacturing PMI printed 55.5 in May compared to 56.2 in April.

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Wells Fargo Research Team

Wells Fargo

EUR/USD trims gains, hovers around 1.1900 post-US data

EUR/USD trades slightly on the back foot around the 1.1900 region in a context dominated by the resurgence of some buying interest around the US Dollar on turnaround Tuesday. Looking at the US docket, Retail Sales disappointed expectations in December, while the ADP 4-Week Average came in at 6.5K.

GBP/USD comes under pressure near 1.3680

The better tone in the Greenback hurts the risk-linked complex on Tuesday, prompting GBP/USD to set aside two consecutive days of gains and trade slightly on the defensive below the 1.3700 mark. Investors, in the meantime, keep their attention on key UK data due later in the week.

Gold loses some traction, still above $5,000

Gold faces some selling pressure on Tuesday, surrendering part of its recent two-day advance although managing to keep the trade above the $5,000 mark per troy ounce. The daily pullback in the precious metal comes in response to the modest rebound in the US Dollar, while declining US Treasury yields across the curve seem to limit the downside.

Bitcoin Cash trades lower, risks dead-cat bounce amid bearish signals

Bitcoin Cash trades in the red below $522 at the time of writing on Tuesday, after multiple rejections at key resistance. BCH’s derivatives and on-chain indicators point to growing bearish sentiment and raise the risk of a dead-cat bounce toward lower support levels.

Dollar drops and stocks rally: The week of reckoning for US economic data

Following a sizeable move lower in US technology Stocks last week, we have witnessed a meaningful recovery unfold. The USD Index is in a concerning position; the monthly price continues to hold the south channel support.

Bitcoin Cash trades lower, risks dead-cat bounce amid bearish signals

Bitcoin Cash (BCH) trades in the red below $522 at the time of writing on Tuesday, after multiple rejections at key resistance. BCH’s derivatives and on-chain indicators point to growing bearish sentiment and raise the risk of a dead-cat bounce toward lower support levels.