Nasdaq 100, EUR/USD, WTI drop as Trump fires Fed official
Nasdaq 100, EUR/USD, WTI fall as Trump fires Fed governor Lisa Cook, though the legality of the move is unclear.
Market analysis
Markets are on edge as President Trump fires Federal Reserve (Fed) governor Lisa Cook over alleged mortgage improprieties, though her term runs to 2038 and the legality of the move is unclear.
The action deepened concerns about political interference at the central bank, following Trump’s past threats against Fed chairman Jerome Powell.
Markets react nervously: Asian equities dropped, European and US futures softened, and gold touched a two-week high as investors assessed risks to US policy credibility.
Longer-dated Treasuries sold off while shorter-dated debt rose, and the US dollar weakened against the euro, reflecting doubts over long-term US creditworthiness.
Nasdaq 100 remains below record high
The Nasdaq 100's sell-off from its 23,969 all-time high has taken it to last week's 22,960 low from which it has since recovered.
Overhead resistance can be spotted around the July peak at 23,589, a rise above which would likely indicate a resumption of the medium-term uptrend towards its all-time high.
While Friday's high at 23,575 caps, though, the 21 July high at 23,264 may well be revisited. Below it lies last week's low at 22,960 and the 55-day simple moving average (SMA) at 22,936. Failure there would engage the 22,674-to-22,587 support zone. It consists of the 7 July-to-1 August lows.
Nasdaq 100 daily candlestick chart
EUR/USD remains sidelined
EUR/USD's retest and subsequent rejection by its mid-August two-week high at $1.1730 seems to be finding support above last week's $1.1583 two-week low.
Were this level to give way, the July low at $1.1557 may be reached next, together with the medium-term uptrend line at $1.1550. Slightly further down potential support may be seen at the 5 August low at $1.1528.
Resistance remains to be seen between the 7 August high at $1.1699 and last week's peak at $1.1742.
EUR/USD daily candlestick chart
WTI tests resistance zone
WTI crude oil's recovery from its $61.45 per barrel August low has taken it to its key $63.86-to-$64.83 resistance zone which caps for now on a daily chart closing basis.
While it holds, the 8 August low at $62.77 may be revisited. Further down lies minor support around the 13 August low at $61.94.
A rise above Monday's $65.10 high would be expected to engage the June-to-August resistance line at $65.95, the 55-day simple moving average (SMA) at $66.33 and the 6 August high at $66.75. Further up meanders the 200-day simple moving average (SMA) at $67.43 which may also act as resistance, if reached.
WTI daily candlestick chart
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