American stocks made a strong comeback on Thursday as investors reflected on the strong earnings. While companies like Goldman Sachs, JP Morgan, and Citi’s earnings disappointed, most others have reported strong results. These are companies like Morgan Stanley, Procter & Gamble, and United Airlines. The results show that many companies are doing well even as inflation continues growing. The Dow Jones jumped by over 400 points while the Nasdaq 100 and S&P 500 indices rose by 260 and 60 points.
The US dollar index retreated slightly after the mixed economic data from the United States. On the one hand, numbers by the Bureau of Labor Statistics (BLS) showed that initial jobless claims rose from 231k to 286k last week. Continuing claims also rose from 1.5 million to over 1.63 million. On the other hand, data by the Philadelphia Federal Reserve showed that the manufacturing index jumped from 15.4 to 23.2 in January. Most importantly, data showed that the country’s home prices jumped at a record pace in 2021. Home sales rose to 6.12 million, the fastest pace in 15 years. Home sales started slowing in the final half of the year as supply waned.
The price of crude oil continued rising in the overnight session as investors reflected on the latest inventories data. According to the EIA, inventories rose by about 515,000 barrels last week. That was a significant increase considering that the country had a drawdown of more than 4.55 million barrels. It was the first week in eight weeks that the number of inventories rose. Analysts believe that oil demand will keep rising in the coming weeks. The key data to watch today will be the latest UK and Canadian retail sales numbers.
XBRUSD
The XBRUSD pair jumped to a high of 88.42, which was the highest level in over 7 years. The pair rose above the 25-day and 50-day moving averages. It also rose above the key resistance level at 85.91, which was the highest level last year. The Relative Strength Index (RSI) and MACD continued rising. Therefore, the pair will likely keep rising as bulls target the key resistance at 90.00.
EURUSD
The EURUSD pair moved sideways in the overnight session as investors focused on the latest US housing and initial jobless claims data. It is trading at 1.1335, where it has been in the past few days. On the four-hour chart, the pair moved slightly below the key resistance at 1.1365. It is also along the 25-day moving average and is between the lower and middle lines of the Bollinger Bands. Therefore, the pair will likely have a bearish breakout later today.
NAS100
The Nasdaq 100 index bounced back as investors attempted to buy the dips. The index moved above the middle line of the Bollinger Bands. It also moved to the 25-day moving average while the Relative Strength Index (RSI) has moved above the oversold level. Therefore, the index will likely bounce back as bulls target the key resistance at $15,400.
