TVC Market Overview for May 6: DXY by Market_Vision1 — TradingView

Good morning everyone, let’s quickly review the latest updates and understand the current market conditions.

First takeaway: Operation Freedom, announced by Trump, is all but over after just one day of launch. The situation in the Gulf remains unclear, with much ambiguity and no accurate data on what is actually happening.

Trump said the suspension was at Pakistan’s request. Frankly, Pakistan seems to have been involved in every major decision – once to reduce escalation, once to extend the truce, and now to cease operations.

At the same time, there is no clear evidence that the ship actually crossed the channel under this operation. So far, the whole issue is still a question mark.

Trump came back and said they were very close to a deal with Iran, but this has happened many times before, so it’s best to wait and see and not get your hopes up.

As for the market – oil is starting to fall. When the operation was announced at the beginning of the week, the price reached around 115. After cancellation, it returned to the 107-108 range.

Clearly, the market has begun to view these moves as a source of instability rather than support. It is currently in a balanced state of around 100-105. As long as there is no significant jump, this situation is still acceptable.

Let’s look at the economic data.

The U.S. trade balance report was released, and the deficit rose to about $60 billion. Interestingly, both exports and imports increased at the same time – exports increased by approximately $6.2 billion and imports by approximately $9 billion.

But the main reason for the increase in exports is rising energy prices. The United States is taking advantage of this situation to export large quantities of oil and natural gas to make up for global shortages.

However, this is not enough to cover imports.

The important point here is: if energy prices return to normal levels, exports will likely fall and deficits will continue. This could put pressure on the dollar going forward.

On the other hand, there are positive signs.

The economic activity data (PMI) for both the U.S. industrial and services sectors exceeded 50. This means that the economy remains active, expectations are positive, and conditions are better than in previous months.

Let’s get back to oil.

Last week, Energy Department data showed inventories fell by about 6 million barrels, which pushed prices higher.

Now, preliminary data from the American Petroleum Institute shows an even steeper decline in production, about 8.2 million barrels.

The market usually reacts strongly to preliminary data, but if official data confirms this decline, we may see a new wave of gains.

Therefore, pay attention to the time of release of the data – around 6pm Moscow time – as it may be in the midst of a strong move.

Additionally, today we have ADP employment data, which is a precursor to the weekend’s major employment numbers. This data can move the market, especially before the second trading day.

So that’s something to focus on today.

Pay attention to the news, monitor the market reaction, and we will have a clearer vision at the beginning of the meeting.

We work as usual – calm and focused.

We will see you in the meeting and wish you happy trading👍