EURUSD
- Current Trading Position: The EUR/USD holds gains near 1.0750 in European trading on Monday.
- French Elections Influence: The Euro rose as French exit polls indicated the far-right National Rally (RN) party winning the first round of snap elections.
- ECB Rate Cuts: European Central Bank (ECB) Governing Council member Olli Rehn indicated last week that the central bank could lower interest rates two more times this year.
- US Inflation Data: On Friday, the US Bureau of Economic Analysis reported that US inflation eased to its lowest annual rate in over three years. The US Personal Consumption Expenditures (PCE) Price Index increased by 2.6% year-over-year in May, down from 2.7% in April, meeting market expectations.
- Fed's Monetary Policy: On Friday, the Federal Reserve Bank of San Francisco President Mary Daly said that monetary policy is working. However, she emphasized that it’s too early to determine when it will be appropriate to cut the interest rate.
| SMA (20) | Falling |
|
|
| RSI (14) | Rising |
|
|
| MACD (12, 26, 9) | Falling |
|
|
Closing statement: The EUR/USD remains buoyant near 1.0750, influenced by the ongoing French elections, ECB's potential rate cuts, and recent US inflation data. Investors should stay vigilant regarding upcoming ECB decisions and further statements from Fed officials, as these factors will play critical roles in the currency pair's near-term movements.
GBPUSD
- Current Trading Position: The GBP/USD pair trades on a stronger note around 1.2675 during the early European session on Monday.
- US Dollar Influence: The US Dollar (USD) edges lower as the US Personal Consumption Expenditures (PCE) Price Index for May eased to its lowest annual rate in more than three years, providing some support to the major pair.
- Fed Rate Cuts: Fed officials have emphasized recently that they will cut interest rates once they are confident that inflation has decelerated to the 2% target.
- UK General Election: The general election in the United Kingdom, scheduled for Thursday, is likely to trigger volatility in the pair.
- Upcoming Data: Traders await the US June ISM Purchasing Managers Index (PMI) for fresh impetus, which is due today.
| SMA (20) | Slightly Falling |
| |
| RSI (14) | Slightly Rising |
| |
| MACD (12, 26, 9) | Falling |
|
|
Closing statement: The GBP/USD pair remains strong around 1.2675, influenced by easing US inflation data and expectations of future Fed rate cuts. The upcoming UK general election and US ISM PMI data are key events to watch, as they could introduce significant volatility and provide fresh direction for the pair.
GOLD
- Current Trading Position: Gold price is treading water near $2,325 in European trading hours on Monday, holding Friday’s range play.
- Fed Rate Cut Expectations: Traders raised their bets for a Fed rate cut in September after data on Friday showed that the annual core PCE Price Index, the Fed’s preferred inflation measure, rose 2.6% in May, slowing from a 2.8% increase in April.
- Support Factors: Losses in gold price could be capped by stronger-than-expected China’s Caixin Manufacturing PMI data and renewed expectations of a Fed rate cut as early as September.
- Downside Risks: Gold price remains exposed to downside risks if the US Dollar stages a comeback on a profit-taking rally ahead of the US ISM Manufacturing PMI data due later on Monday and Fed Chair Jerome Powell’s speech on Tuesday.
- Market Sentiment: Gold traders refrain from placing any fresh directional bets ahead of this week’s speech by US Federal Reserve (Fed) Chair Jerome Powell at the European Central Bank’s (ECB) forum on Tuesday and Friday’s Nonfarm Payrolls data.
Closing statement: Gold is holding steady near $2,325, influenced by mixed signals from economic data and expectations around Fed rate cuts. The upcoming US ISM Manufacturing PMI, Fed Chair Powell’s speech, and Nonfarm Payrolls data are critical events that could introduce volatility and determine the next direction for gold prices.
CRUDE OIL
- Current Trading Position: West Texas Intermediate (WTI) US crude oil prices attract some dip-buyers on the first day of the new week, remaining close to the two-month peak touched on Friday.
- Geopolitical Risks: Persistent geopolitical risks from ongoing conflicts in the Middle East and Ukrainian attacks on Russian refineries continue to fuel concerns about supply disruptions from key oil-producing countries.
- Supply-Demand Dynamics: Expectations of peak summer fuel consumption and OPEC+ cuts in the third quarter could lead to a global oil market supply deficit, which is seen as a key factor supporting crude oil prices.
- US Economic Data: The US Personal Consumption Expenditures (PCE) Price Index released on Friday confirmed a disinflationary trend and boosted bets for a September interest rate cut by the Federal Reserve (Fed).
- China's Economic Activity: Data released over the weekend showed that China's manufacturing activity fell for a second month in June, while services activity slipped to a five-month low, adding a layer of complexity to the oil demand outlook.
| SMA (20) | Rising |
|
|
| RSI (14) | Rising |
|
|
| MACD (12, 26, 9) | Rising |
|
|
Closing statement: Crude oil prices are maintaining their upward momentum due to supply concerns and geopolitical risks, despite mixed economic signals from major economies like the US and China. The market remains watchful of summer fuel demand trends and the impacts of OPEC+ production cuts, which could further influence price movements in the coming weeks.
DAX
- French Inflation Figures: On Friday, French inflation figures for June sent mixed signals. The annual inflation rate fell from 2.3% in May to 2.1% in June. However, the harmonized inflation rate softened less markedly, falling from 2.6% to 2.5%.
- German Unemployment Rate: The German unemployment rate unexpectedly increased from 5.9% in May to 6.0% in June. The number of unemployed people rose from 2.762 million to 2.781 million, following a 19,000 increase in unemployment.
- Euro Area Economic Indicators: While economic indicators from the Euro area attracted investor attention, the crucial US Personal Income and Outlays Report offered late support.
- French Political Risks: An absolute far-right majority in France could destabilize the EU Project and the Euro area economy. The projections will likely provide market relief going into the Monday session.
- Upcoming Economic Data: On Monday, finalized manufacturing PMI numbers from the Euro area and German inflation figures warrant investor attention. Unless there are marked revisions to the preliminary PMIs, the German inflation numbers will have a more significant impact on the DAX.
| SMA (20) | Slightly Falling |
| |
| RSI (14) | Rising |
|
|
| MACD (12, 26, 9) | Slightly Rising |
|
Closing statement: The DAX faces multiple influencing factors, including political uncertainty from the French elections, economic data from the US, and EU trade policies. Additionally, upcoming German unemployment figures and French inflation data will be crucial in shaping investor expectations regarding potential ECB rate cuts. Market participants will need to closely monitor these developments to navigate the current economic landscape.