There are significant reversals and corrections in the markets. In addition, there are new signals.

EURUSD: The EURUSD has been bullish in this week – moving upwards by around 150 pips. However, this is not without a sharp retracement that occurred in the middle of this week. Right now there is a new ‘buy’ signal on the chart, though there is also a strong resistance line at 1.3000, which would soon be breached.

Oil fell to a 3-week low in a broader commodities selloff as a decline in China’s factory activity entrenched concern about weak demand, and worries about an early scale-back in US Federal Reserve stimulus haunted markets. China’s factory activity shrank for the first time in seven months in May, weighing on oil as well as copper, for which China is the world’s top consumer. Brent crude fell $ 1.22 to $ 101.20 a barrel after dropping to $ 100.64, the lowest since May 2.

Data/Event Risks

USD: Durable goods data is always a bit of a roller-coaster and coming on a Friday, could inspire more volatility than usual in FX ahead of the weekend, with London also closed on Monday for a Bank Holiday.  After a 6.9% fall last month, the expectation is for a gain of 1.9% this month.

EUR: The German Ifo release is one of the more important ones of the monthly calendar. The headline index has fallen for the past two months and the market expects a steady outcome at 104.4 for the May release.  A weaker number would undermine the euro, which has held up relatively well, given the generally firmer dollar environment seen through this week.

The important energy sector accounts for roughly 16.0 percent of the S&P 500 Index. Today, most of the leading energy stocks are declining lower at the start of the session. Exxon Mobil Corp (NYSE:XOM) is the leading stock in the sector. This stock also has the largest market capitalization in the stock market at $406 billion, so it is safe to say that this stock carries a lot of weight in the markets. Day traders should watch for three important support levels on XOM at $91.00, and $90.45, and $89.43. These are all levels where XOM stock could bounce intra-day. 

European Markets Data

Index	Quote	Change	Change%
Russia	1417.2	-44.73	-3.06%
London	6714.2	-126.07	-1.84%
Paris	3953.63	-97.48	-2.41%
Frankfurt	8306.7	-224.19	-2.63%
Turkey	91607.81	-1571.06	-1.69%
Hungary	18881.33	-195.07	-1.02%
Austria	2431.3	-63.57	-2.55%
Poland	45320.99	-612.67	-1.33%
Czech	973.48	-15.91	-1.61%
Sweden	1221.6	-32.97	-2.63%
Finland	6288.89	-198.08	-3.05%
Norway	447.87	-8.36	-1.83%
Greece	1067.02	-13.63	-1.26%
Italy	18087.7	-504.47	-2.71%

Data/Event Risks

GBP:  The GDP revisions today will be watched for potential revisions, but risks are small in our view.

USD: The weekly claims data has been more volatile of late and the dollar has proven to be more sensitive to the data as a result. Market looks for modest fall to 345k from last week’s 360k reading. 

EUR:The single currency will be sensitive to further signs of slowdown in the initial readings on PMI data for both services and manufacturing for the Eurozone. Euro has held up relatively well considering the other moves in the past 24 hours, but weak PMIs could well change this.

As expected, the majors have continued to go in the directions of the dominant biases. The JPY pairs are also still bullish despite the current retracements. Some important fundamentals are expected today.

EURUSD: This pair has lost the gain it saw at the beginning of this week – it just happened that the supposed northward upsurge was only a rally in the context of a downtrend. The price spiked towards the resistance line of 1.3000 and dropped sharply. The next bearish target is the support line at 1.2800. That line could be retested again.