US data and OPEC+ decision to drive the markets
USD/JPY => The pair roses to 130.00
Salesforce => The stock rises to a monthly high
Oil => The commodity falls towards 112.00
USDJPY rises to a 2-week high
USDJPY rose 1.1% in the previous session, marking the third straight day of gains.
The USD rose on hawkish Fed bets after US ISM manufacturing PMI unexpectedly rose to 56.1 in May, upwardly revised from 54.5. The data, combined with several hawkish Fed speakers, fuelled speculation that the central bank could act more aggressively to bring inflation back to 2%.
Attention will now turn towards the ADP private payroll figures, continuing jobless claims, and factory orders for further clues over the health of the US economy.
|US ISM manufacturing
US ADP payroll
|Actual: 56.1 (0.7)
Expected: 300k (53k)
Where next for USD/JPY?
After USD/JPY reached a 20-year high of 131.50, the pair trended lower, running into support on the 50 sma, before rebounding higher.
The RSI is bullish, without reaching overbought territory. Buyers will need to rise above 131.50 in order to extend the rebound into fresh bullish territory. Meanwhile, sellers will look for a break below 129.50, the April 22 high, with a break below here exposing the 20 sma at 128.70 ahead of the 50 sma at 127.20
Salesforce jumped 9.8% yesterday. Here’s why.
Salesforce rose after reporting Q1 earnings, which surpassed Wall Street’s expectations and raised full-year earnings.
Salesforce reported EPS of $0.98 above the $0.94 forecast on revenue of $7.41 billion, above the $7.38 billion forecast. This marked a 24% increase in revenue year over year. Salesforce reported revenue from its Service Cloud business rose 17% to $1.76 billion, while revenue from sales cloud products rose 18% to $1.63 billion.
The firm said that the broader downturn in the economy just isn’t being reflected in the results. Looking ahead, Salesforce expects Q2 EPS of $1.01 to $1.02 on revenue of $7.69 billion to $7.70 billion.
Will OPEC raise output by more than planned?
Oil prices fell yesterday for a second straight session despite Shanghai reopening, boosting the demand outlook, and the EU approving the proposed Russian oil ban, which will be phased in over six months. Instead, oil prices have lost ground ahead of today’s OPEC meeting on concerns as to what the group could agree on.
Since the EU Russian oil ban, this will be the first meeting for oil-producing nations, and reports suggest that unity within the group is starting to fail. OPEC members are reportedly keen to suspend Russia from the group, which could lead to the likes of Saudi Arabia and UAE pumping more oil to counter the effects of the sanctions, which could drag the price lower,
Support can be found at 108.20 (late May low) and 105.75 (20 sms).
Resistance for the pair can be seen at 116.30 (March 24 high) and 120.00 (round number).