Forexlive Americas FX news wrap 23 May: USD reversed higher after stronger S&P/Global PMI

• Goldman Sachs expect a Bank of England 25bp rate cut in August (previously tipping June)
• Snatching defeat from the jaws of victory in the US stock market
• The National Oceanic and Atmospheric Administration predicts high hurricane activity
• Atlanta Fed Pres. Bostic: Last couple inflation numbers suggested going back to 2%
• Crude oil futures settle at $76.87
• US interest rate rise > than Nvidia earnings
• U.S. Treasury sells $16 billion of 10-year TIPS at a high yield of 2.184% (last 1.93%)
• European major indices close the session with mixed results
• The USD is moving up.How has that translated technically for USDCAD, EURUSD, USDJPY,GBPUSD
• ECBs Villeroy: Latest wage data was a bit above expectations but due to Germany
• Eurozone consumer confidence (flash) for May -14.3 versus -14.2 estimate
• US new home sales for April 0.634M vs 0.679M estimate
• Sky News Arabia: The Israeli position is still not qualified to reach a deal on cease-fire
• BOE cancels all public statements until after July 4 UK election
• Kickstart the FX trading day on May 23 w/a technical look at the EURUSD, USDJPY and GBPUSD
• US initial jobless claims 215K versus 220K estimate
• BOJ Ueda: No change in view of Japan economic outlook despite Q1 GDP contraction
• The NZD is the strongest and the USD is the weakest as the NA session begins
• ForexLive European FX news wrap: Dollar sluggish on better risk mood; PMI up next

The North American session started with the USD as the weakest of the major currencies. And then US initial jobless claims came in better than expected – moving back to 215K. That took the concern of employment from a few weeks ago when the number suddenly spiked to 231K back out of the equation. Jobs market remains robust from that measure.

Then at 9:45 AM ET, the S&P/Global flash PMI data for manufacturing and service came out with stronger than expected at 50.9 manufacturing versus 50.0 estimate and services at 54.8 versus 51.3 estimates. The data sent yields higher and started the turnaround in the greenback.

By the end of the day, the CHF and the NZD are still ending the day as the strongest, but the USD ends with gains vs the other currencies including a 0.31% gain vs the CAD and a 0.21% gain versus the AUD. The gains may not be strong vs yesterday, but where the greenback came from at session lows, it was a decent reversal.

For the EURUSD, it is closing the day below the 100-day moving average of 1.08142 after trading is only as is 1.0860. The low price reached just above the 100-bar moving average on the 4- hour chart at 1.0804. Falling below the 100 bar moving average on the 4-hour chart into the 200 day moving average 1.0886 in the new trading day would increase the bearish bias.

The GBPUSD fell back below its 100 hour MA at 1.27129, but did find support buyers near the swing level at 1.2685. Both those levels will be key barometers going forward.

The USDCAD fell to the broken 38.2% of the move down from May 8 high at 1.3655 before reversing higher and extending above its 100 and 200 bar MA on the 4-hour chart at 1.3670 and 1.3698 respectively, along with the 61.8% retracement at 1.3696. The move above those levels gave the buyers the go-ahead to take the price higher, and traders pushed all the way up to 1.3743 before backing off into the close (currently trading at 1.3728).

IN other markets, the US stocks snatched defeat from the jaws of victory after Nvidia earnings smashed expectations after the close yesterday. The price of Nvidia did close sharply higher with a gain of 9.32%, but the lift all boats idea did not work well for the other large cap stocks. The NASDAQ index closed lower by -0.39% or -65.51 points after being up as much as 194.84 points. The S&P index closed down -39.17 points after being up 34.86 points. The Dow was the worst performer with a decline of -605.78 points or -1.53%. At session highs the index was up 23.90 points.

US yields were to blame for the dollars rise and the stock markets fall:

• 2-year yield 4.939%, +6.2 basis points
• 5-year yield 4.533%, +6.0 basis points
• 10 year yield 4.470%, +4.5 basis points
• 30-year yield 4.582%, +3.2 basis points

In other markets:

• Crude oil is trading at $76.88 down $0.69 or -0.88%
• Gold fell $-50.14 or -2.11% to $2.328.28 as it reacted to higher rates and a higher US dollar.
• Bitcoin fell to $67,764. At the start of the US session the price was at $69,944.
• Ethereum trades at $3765.80. At the start of the US session the price was trading at $3900.

Tomorrow Canada retail sales and US durable goods along with University of Michigan survey (watching inflation) will be eyed during the North American session.

This article was written by Greg Michalowski at www.forexlive.com.