EURUSD
- EUR/USD Stability: The EUR/USD pair saw little movement on Monday, maintaining a position around the 1.0860 mark for most of the day.
- Quiet Trading Day: A holiday in Europe and a light macroeconomic calendar in the United States contributed to the lack of significant action in the pair.
- Fed Officials' Commentary: Investors focused on comments from Federal Reserve officials, who expressed caution regarding future actions due to uncertainties surrounding the disinflationary process in the US.
- Upcoming Eurozone Data: Europe will return on Tuesday with the release of some minor figures, including the March Current Account and Trade Balance, which are expected to influence market sentiment.
- Fed Speakers on Tuesday: The American session will feature many Federal Reserve speakers, including FOMC Vice Chair Williams, Mester, Collins, Waller, Barkin, Bostic, and Barr, whose comments will be closely watched by investors.
| SMA (20) | Rising |
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| RSI (14) | Rising |
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| MACD (12, 26, 9) | Rising |
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Closing statement: The EUR/USD pair experienced a quiet session on Monday, hovering around 1.0860, influenced by a European holiday and a sparse US macroeconomic calendar. Investors turned to Federal Reserve officials' comments, who remained cautious about future actions due to ongoing uncertainties in the disinflationary process. On Tuesday, the Eurozone's release of the March Current Account and Trade Balance figures will draw attention, while the American session will be highlighted by speeches from several key Federal Reserve officials, which are expected to provide further insights into the Fed's policy outlook.
GBPUSD
- Steady Dollar: The US Dollar traded steadily on Tuesday due to the lack of significant economic data releases from both the US and the UK.
- Fed Officials' Stance: Federal Reserve officials remained cautious about the timing of the easing cycle, emphasizing the need to maintain higher rates for an extended period to ensure inflation is moving towards the target.
- Fed Vice Chair's Comment: On Monday, Fed Vice Chair Michael Barr highlighted the necessity of allowing restrictive policies more time to have their intended effects.
- Fed Policymaker's View: Fed policymaker Philip Jefferson noted that while inflation is easing, it is not doing so as quickly as anticipated.
- Upcoming Data: Market participants are looking forward to the UK Consumer Price Index (CPI) inflation data and the release of the FOMC Minutes on Wednesday for further direction.
| SMA (20) | Rising |
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| RSI (14) | Rising |
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| MACD (12, 26, 9) | Rising |
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Closing statement: The GBP/USD pair saw steady trading on Tuesday as both the US Dollar and the British Pound lacked significant economic data releases to drive market movements. Federal Reserve officials emphasized the importance of maintaining higher interest rates to ensure inflation moves towards the target, with Fed Vice Chair Michael Barr advocating for more time for restrictive policies to work and Fed policymaker Philip Jefferson noting the slow pace of inflation easing. Investors are now focused on the upcoming UK Consumer Price Index inflation data and the FOMC Minutes release on Wednesday, which are expected to provide further market insights.
GOLD
- Gold Price Pullback: The gold price is pulling back from its all-time high of $2,450, driven by increased demand for the US Dollar as a safe haven amid broad market risk aversion.
- All-Time High Trigger: Gold surged to a new all-time high after reports emerged that Iran’s President Ebrahim Raisi and Foreign Minister Hossein Amirabdollahian died in a helicopter crash in Iran's East Azerbaijan province.
- Fed President Mester's Warning: Cleveland Fed President Loretta Mester warned that inflation risks are tilted to the upside and indicated that she no longer believes three rate cuts in 2024 are appropriate.
- Fed President Daly's Outlook: San Francisco Fed President Mary Daly mentioned that while she expects shelter inflation to improve gradually, the progress is not expected to be quick.
- Focus on Fed Speeches: In the absence of significant US economic events, market attention is now on upcoming speeches from Federal Reserve policymakers scheduled for early this week.
Closing statement: Gold prices are experiencing a pullback from the recent all-time high of $2,450, influenced by increased safe-haven demand for the US Dollar amid broad risk aversion. The surge to the record high was triggered by reports of the deaths of Iran’s President Ebrahim Raisi and Foreign Minister Hossein Amirabdollahian in a helicopter crash. Cleveland Fed President Loretta Mester's comments on inflation risks and San Francisco Fed President Mary Daly's cautious outlook on shelter inflation have also impacted market sentiment. With a lack of top-tier US economic data, investors are now focused on upcoming speeches from Federal Reserve policymakers to gauge future monetary policy directions.
CRUDE OIL
- WTI Oil Price Losses: The WTI Oil price continues to decline, likely due to hawkish comments from Federal Reserve officials about maintaining higher interest rates for a longer period.
- Increased Rate Cut Expectations: According to the CME FedWatch Tool, the probability of the Federal Reserve implementing a 25 basis-point rate cut in September has increased slightly to 49.6%, up from 48.6% a week earlier.
- Geopolitical Stability in Oil Market: The oil market remains largely unaffected by geopolitical events such as the death of Iran’s President and health concerns about Saudi Arabia’s King.
- Trans Mountain Pipeline: Canada's Trans Mountain pipeline has commenced commercial operations this month, adding 590,000 barrels per day to the market.
- Focus on OPEC+ Meeting: Investors are now looking ahead to the upcoming OPEC+ meeting on June 1, where the organization and its affiliates will set their output policy.
| SMA (20) | Falling |
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| RSI (14) | Slightly Rising |
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| MACD (12, 26, 9) | Slightly Rising |
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Closing statement: WTI Oil prices are extending their losses, influenced by hawkish remarks from Federal Reserve officials regarding prolonged higher interest rates. Despite geopolitical events like the death of Iran's President and concerns about Saudi Arabia's King, the oil market has remained stable. The commencement of commercial operations of Canada's Trans Mountain pipeline, adding 590,000 barrels per day, is also a significant development. Meanwhile, market participants are increasingly anticipating a potential rate cut by the Federal Reserve in September, with probabilities rising slightly. Attention is now turning to the upcoming OPEC+ meeting on June 1, where critical decisions on oil output policy will be made.
DAX
- ECB Rate Path Uncertainty: On Monday, uncertainty regarding the ECB's post-June rate path limited gains, despite rising expectations of a June rate cut providing initial support.
- Cautious Fed Speakers: Fed officials, including Michael Barr, Raphael Bostic, Mary Daly, and Philip Jefferson, expressed the need for more confidence in inflation returning to target before supporting a rate cut.
- German Producer Prices: German producer prices fell more than expected in April, decreasing by 3.3% year-on-year, mainly due to lower energy prices.
- Eurozone Trade Data: Eurozone trade data to be considered today shows a forecasted narrowing of the trade surplus from €23.6 billion to €19.9 billion in March, potentially influencing the ECB's rate decisions.
- Monitoring ECB Chatter: Amidst rising uncertainty about the post-June ECB rate path, investor focus should be on ECB communications. Support for multiple rate cuts could boost demand for DAX-listed stocks.
| SMA (20) | Rising |
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| RSI (14) | Rising |
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| MACD (12, 26, 9) | Rising |
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Closing statement: Uncertainty regarding the ECB's post-June rate path limited DAX gains, though expectations of a June rate cut provided some initial support. Investors should watch for ECB communications, as support for multiple rate cuts could increase demand for DAX-listed stocks.