EU Market Review 1st June 2021

by Elina Nikolova

SILVER (XAG) is trading around 28.30 just above the 0.618 Fibonacci retracement level at price 27.68, after penetrating that level and staying above it. The price is also below the tentative downtrend line formed from the all-time high of 30.09, which materialized on 01 February 2021. The Relative Strength Index is above the mid-point 50 level in bullish area, but still below the 70 oversold area border, indicating a bullish tendency for the Silver.
With a break and closing above the 28.40 level, there is potential for a further increase in the price. Resistance levels at 28.40 price that is derived from February 23rd top, also at 30.09 derived from February’s all time high and at 32.47 which is taken from a previous 2013 old top.
If the price returns below 26.93 at the 0.50 Fibonacci retracement level, there is a possibility for the trend to reverse. For the bears, the support levels lie at 26.64 inside support level from March 18th top, at 24.02 derived from the March 31st low and at 21.83 bottom from November 30th 2020.

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• It’s a busy day today in EU and the UK, with stats coming mainly from EU economic area. News include German Final Manufacturing PMI, German Unemployment figures, UK Final Manufacturing PMI, EU Unemployment rate and comments by Bank of England Governor Andrew Bailey.

• Asia Pacific stocks were mostly up Tuesday morning as investors digested more Chinese economic data released earlier in the day, and await key U.S. economic data, due later in the day, to gauge the country's economic outlook.

• European stocks slipped from record highs on Monday in subdued trading due to holidays in major markets, but optimism over a swift economic recovery helped the STOXX 600 index mark its fourth straight month of gains. UK and U.S. markets were closed for a holiday, keeping trading volumes muted across the board.

• New lending to euro zone companies plunged in April, indicating that banks are tightening access to credit even as the bloc starts to emerge from a year of lockdowns, data from the European Central Bank showed on Monday.
The monthly flow of loans to euro zone companies was a negative 26.8 billion euros in April, reversing much of the 51.1 billion euro ($62.3 billion) rise a month earlier, dragging the annual growth rate of new loans to a 14-month low of 3.2% after last month's 5.3%.

• Inflation in Germany, as measured by the Consumer Price Index (CPI), edged lower to 0.5% (preliminary) on a monthly basis in May from 0.7% in March, the data published by Destatist showed on Monday. On a yearly basis, the CPI rose to 2.5% from 2%.

• At 07:55 (GMT) EU German Final Manufacturing Purchasing Managers' Index (PMI) is due. A figure above 50.0 indicates industry expansion, below indicates contraction.

• At 07:55 (GMT) EU German Unemployment Change is also due. This indicator measures the change in the number of unemployed people during the previous month.

• At 08:30 (GMT) UK Purchasing Managers' Index (PMI) expected . This is a survey of about 600 purchasing managers which asks respondents to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.

• At 09:00 (GMT) – EU Unemployment Rate is to be announced. This indicates the percentage of the total work force that is unemployed and actively seeking employment during the previous month.

• At 15:00 (GMT) UK Bank of England Governor Andrew Bailey is due to deliver a speech titled "Building a Finance System Fit for a Clean, Resilient and Just Future" at an online event hosted by Reuters. Audience questions expected.

European indices yesterday:

• DAX: -0.64%
• EURO: -0.76%
• MIB: 0.00%
• CAC: -0.57%

Sources: Investing.com, forexfactory.com, nasdaq.com, fxstreet.com.