EURUSD
- The analysis highlighted that EUR/USD was maintaining mild gains around 1.0880. This behavior was seen as a defense of the rebound that had initiated at the beginning of the week, reclaiming ground from a six-week low.
- The analysis suggested that the recent recovery of the Euro pair might be attributed to a consolidation phase following a five-week downtrend.
- The rebound in the EUR/USD was potentially influenced by factors such as anticipation of August month Purchasing Managers Indexes (PMIs) and the upcoming Jackson Hole Symposium, an annual event for central bankers.
- The Eurozone’s July Harmonized Index of Consumer Prices (HICP) rate remained at 5.3%, indicating a slowdown from the mid-2022 record peaks. This development signaled that while growth might be stagnating, significant price pressures were still well above the European Central Bank's (ECB) comfort level of 2%.
- The analysis shed light on the EUR/USD's current situation, capturing its modest gains as it defended the recent rebound. This recovery was attributed to the consolidation after a downtrend, possibly driven by factors like upcoming PMIs and the Jackson Hole Symposium. Despite encouraging elements like the slowdown in HICP, concerns remained about growth stagnation and persistent high inflation, which exceeded ECB's desired levels.
| SMA (20) | Falling |
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| RSI (14) | Neutral | ||
| MACD (12, 26, 9) | Slightly Falling |
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Closing statement: EUR/USD was observed holding onto slight gains near 1.0880, guarding the week-start recovery from a six-week low. This rebound from a recent downtrend might be linked to consolidation. Factors such as upcoming PMIs and the Jackson Hole Symposium were influencing its movement. While the HICP indicated a slowdown in inflation, concerns about sluggish growth and persistent high inflation persisted.
GBPUSD
- The analysis noted that the British Pound was consolidating against the US Dollar during the week, even after GBP/USD confirmed a breakout beneath a crucial rising trendline established last year.
- The 100-day Moving Average was highlighted as a key support level that managed to sustain, maintaining a broader bullish perspective for the pair.
- Despite this consolidation, GBP/USD encountered difficulty in surpassing significant technical resistance situated at 1.2770. This resistance level acted as a point of reversal, leading to renewed bearish pressure on the pair.
- The analysis reported that GBP/USD faced intensified bearish momentum following the release of disappointing UK retail sales data. Retail Sales declined by 1.2% on a monthly basis in July, and Retail Sales excluding Fuel contracted by 1.4% during the same period. These readings were worse than analysts' expectations, leading to the Pound Sterling's weakening against other major currencies.
- The analysis concluded by pointing out the upcoming focus areas for the market. These included the release of PMIs for both the United States and the United Kingdom, as well as the Jackson Hole Symposium.
| SMA (20) | Slightly Falling |
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| RSI (14) | Neutral | |
| MACD (12, 26, 9) | Neutral |
Closing statement: GBP/USD engaged in consolidation despite confirming a trendline breakout. The 100-day Moving Average provided essential support, maintaining the overall bullish perspective. While technical resistance at 1.2770 limited further gains, the pair faced renewed selling pressure following disappointing UK retail sales data. Upcoming events, including PMIs and the Jackson Hole Symposium, are expected to guide the pair's direction.
GOLD
- The analysis highlighted that gold prices were encountering difficulty in gaining ground and were trading below the $1,900 level in the Asian session on Monday.
- The upbeat US economic data was cited as a factor contributing to the broad strengthening of the US dollar, which consequently exerted selling pressure on the XAU/USD pair. The US Dollar Index (DXY) was reported to be consolidating its gains around the 103.35 mark.
- The analysis noted that growing concerns about the property market in China were amplifying the already bleak economic outlook, thereby raising expectations for additional stimulus measures from Chinese authorities.
- The US dollar was reported to be attracting fresh safe-haven buying interest, while US Treasury bond yields were resuming their upward trajectory from the previous week.
- The analysis concluded by pointing out the upcoming focus on Fed Chair Jerome Powell's introductory speech at the annual Economic Symposium held in Jackson Hole, Wyoming. Traders were expected to closely analyze his statements for insights into the interest rate outlook.
Closing statement: Gold prices struggled below $1,900 as the US dollar gained strength from positive US economic data. Mounting concerns in China's property market further compounded the economic uncertainty, potentially leading to more stimulus actions by Chinese authorities. The dollar's safe-haven appeal persisted as US Treasury yields continued their upward trend. All eyes were on Fed Chair Powell's speech, scheduled for the Jackson Hole Symposium, as traders sought guidance on future interest rate directions.
CRUDE OIL
- The analysis noted that WTI crude oil was maintaining mild gains around the $81.15 mark as it entered the European session on Monday, continuing a three-day winning streak.
- The recent steep losses in crude oil prices were attributed to concerns about slowing demand in China and the impact of rising US interest rates. These factors led to a significant decline in crude prices, causing them to move away from their 2023 highs and snap a seven-week winning streak.
- The People's Bank of China's (PBOC) decided to cut its one-year loan prime rate by 10 basis points to 3.45%. The five-year loan prime rate, which influences mortgage costs, was left unchanged at 4.20%. The PBOC's move, falling short of market forecasts, indicated limited room for further monetary policy easing.
- Despite the previous week's oil price decline, the analysis underlined that oil prices were still trading around 2% to 3% higher for the year 2023. This performance was partly attributed to the optimistic outlook driven by substantial production cuts by major oil producers like Saudi Arabia and Russia.
- The world's largest oil producers had recently announced the extension of production cuts until at least the end of September. This decision was expected to restrict crude oil supplies by approximately 70 million barrels over a 45-day period.
| SMA (20) | Rising |
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| RSI (14) | Rising |
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| MACD (12, 26, 9) | Slightly Falling |
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Closing statement: WTI crude oil clung to mild gains around $81.15 amid a three-day winning streak. Concerns about China's demand slowdown and rising US interest rates had driven prices lower in the previous week, offsetting their earlier 2023 highs and breaking a seven-week winning streak. The PBOC's interest rate adjustment fell short of expectations, reflecting limited monetary policy space. Despite the recent dip, crude oil retained a positive year-to-date performance, largely buoyed by significant production cuts by major oil-producing nations. These nations' commitment to extended production cuts was expected to limit oil supplies over the coming weeks.
DAX
- The analysis pointed out that Germany stocks closed lower on Friday, with losses primarily observed in the Retail, Construction, and Pharmaceuticals & Healthcare sectors, which contributed to a decline in shares.
- The analysis highlighted that the DAX had experienced a bearish week overall, with a 0.65% decrease on Friday. The index's performance was characterized by a continuation of losses from the previous day, resulting in a total weekly decline of 1.63% to 15,574.
- The analysis attributed the DAX's negative performance to the prevailing market sentiment concerning China's economy. Additionally, efforts made by Beijing to support the economy were noted as factors contributing to the index's downward trajectory.
- German Economy Minister Robert Habeck had proposed tightening the process for reviewing foreign investments through a new law. The aim of this law was to enhance economic security. This development was highlighted through a ministry document seen by Reuters on Sunday.
- Germany's government is urging companies to reduce their reliance on China. Amid these efforts, the government was evaluating the adequacy of its current regulatory framework to encourage such changes.
| SMA (20) | Slightly Falling |
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| RSI (14) | Neutral | |
| MACD (12, 26, 9) | Slightly Falling |
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Closing statement: The DAX experienced a bearish week, marked by losses on Friday as sectors like Retail, Construction, and Pharmaceuticals & Healthcare faced declines. Amid concerns about China's economy and its impact on the global market, the DAX exhibited negative momentum. Germany's Economy Minister's proposal to enhance foreign investment review and encourage companies to reduce reliance on China indicated the ongoing efforts to manage economic dynamics.