EURUSD
- EUR/USD slipped 0.1% to 1.0911, remaining close to a one-month peak.
- EUR/USD climbed to its highest level in a month at 1.0970 on Friday and has been edging slightly lower ever since, still managing to hold up above the critical level of 1.0900.
- The U.S. dollar steadied in early European trade Wednesday ahead of Federal Reserve Chair Jerome Powell's appearance before Congress.
- Sterling gained strength as U.K. inflation remained highly elevated.
- The U.S. dollar received a boost on Tuesday with the release of surprisingly strong U.S. housing data, as housing starts surged 21.7% in May, exceeding expectations.
| SMA (20) | Slightly Rising |
| ||
| RSI (14) | Slightly Rising |
| ||
| MACD (12, 26, 9) | Slightly Rising |
|
Closing statement: EUR/USD experienced a minor decline while remaining near a one-month peak. Despite the retreat, the pair has held above the critical level of 1.0900 after reaching its highest point in a month. As investors await Jerome Powell's testimony, the U.S. dollar stabilizes, while sterling benefits from persistent inflation in the UK.
GBPUSD
- GBP/USD fell 0.3% to 1.2726 after U.K. inflation showed few signs of easing, with the May CPI coming in at 8.7% on an annual basis, unchanged from the prior month.
- The Bank of England meets on Thursday, and it is still widely expected to increase interest rates once more from the current 4.5% level, given that inflation remains more than four times above the central bank's 2% medium-term target.
- The Dollar Index, which tracks the dollar against six other currencies, edged higher to 102.185, trading just above its recent one-month low.
- Gains in the dollar were limited as there wasn't a corresponding jump in building permits, and traders were reluctant to make strong commitments ahead of Powell's congressional testimony, starting with the U.S. House Financial Services Committee today.
- Market participants remain watchful of the Bank of England's decision and Powell's testimony for further guidance on GBP/USD.
| SMA (20) | Slightly Rising |
|
||
| RSI (14) | Falling |  |
|
|
| MACD (12, 26, 9) | Slightly Rising |
|
Closing statement: GBP/USD experienced a 0.3% decline as U.K. inflation remained stubbornly high, putting pressure on the Bank of England to pursue additional interest rate increases. The Dollar Index made slight gains, but the absence of significant growth in building permits tempered the dollar's performance.
GOLD
- Gold prices are currently hovering above three-month lows, recovering from steep losses in the prior session, as traders shift their focus to the dollar in anticipation of further indications on U.S. interest rates.
- The current support level for Gold Price is around $1,930, which coincides with a confluence of support factors and represents a 50% Fibonacci level traced back from February lows.
- The Federal Reserve recently paused its year-long rate hike cycle but has also signaled the possibility of additional rate increases later in the year. Therefore, market participants will closely analyze Powell's comments for insights into the future direction of monetary policy.
- Sentiment regarding the Chinese economic recovery has also deteriorated, as several major investment banks have revised their outlook for full-year economic growth downward.
- The interplay between U.S. interest rates, the strength of the dollar, and global economic conditions will continue to shape the trajectory of XAU/USD.
Closing statement: Gold prices have rebounded slightly from their recent lows as traders monitor the dollar and eagerly await further information on U.S. interest rates. The $1,930 support level holds significance for XAU/USD, and its proximity to the 50% Fibonacci level adds to its technical relevance.
CRUDE OIL
- Crude oil prices rebounded early on Wednesday, recovering after two straight sessions of losses, as expectations of hawkish Federal Reserve talk later in the day and possible U.S. crude stock drawdowns outweighed China demand worries.
- Official U.S. oil inventory data from the American Petroleum Institute industry group will be released later on Wednesday, and the Energy Information Administration on Thursday, with both reports delayed by a day following the Juneteenth public holiday on Monday.
- A lack of clarity on the speed of demand recovery in China, the world's top oil importer, limited price gains, although analysts were optimistic that lowered loan prime rates (LPR) could lift demand soon.
- Looking to boost growth, China on Tuesday cut its benchmark LPR for the first time in 10 months, with a smaller-than-expected 10-basis-point reduction in the five-year LPR.
- Market participants will closely monitor these developments and stay tuned for the latest updates on crude oil prices and trends.
| SMA (20) | Neutral | |
| RSI (14) | Neutral | |
| MACD (12, 26, 9) | Slightly Rising |
|
Closing statement: Crude oil prices showed resilience as they rebounded from previous losses, driven by the anticipation of hawkish Federal Reserve comments and potential drawdowns in U.S. crude stocks. Stay informed about the latest developments in the market as we provide comprehensive analysis and insights.
DAX
- Germany stocks were lower after the close on Tuesday, with the Construction, Retail, and Technology sectors leading the decline in share prices.
- European shares opened lower on Wednesday as rising euro zone bond yields impacted the real estate sector, while persistent inflation in Britain weighed down London stocks.
- Covestro AG was among the best performers on the DAX, rising 12.90% or 5.20 points to trade at 45.51 at the close. MTU Aero Engines NA O.N. and Hannover Rueck SE also showed positive performance.
- On the other hand, Continental AG O.N., BASF SE NA O.N., and Siemens Healthineers AG were among the worst performers, experiencing declines in their share prices.
- Investors will continue to monitor the market closely for further developments and assess the impact on DAX40 performance.
| SMA (20) | Slightly Rising |
|
| RSI (14) | Neutral | |
| MACD (12, 26, 9) | Neutral |
Closing statement: Investors will closely observe the market's reaction to the recent developments, keeping an eye on sector performances and potential shifts in euro zone bond yields. The DAX40 continues to be monitored for any further changes that could impact market sentiment.