EURUSD
- The euro strengthened by 0.31% against the U.S. dollar, reaching $1.0939, in anticipation of remarks by ECB President Christine Lagarde at the ECB Forum on Central Banking in Sintra, Portugal.
- ECB policymaker Martins Kazaks indicated the possibility of future interest rate hikes, citing persistently high inflation levels.
- The U.S. dollar remained resilient against other major currencies, influenced by geopolitical tensions in Russia, while traders awaited U.S. economic data that could impact the timing of future interest rate increases.
- Notable upcoming U.S. data includes durable goods orders, housing figures, and consumer surveys conducted by The Conference Board and the University of Michigan.
- Overall, the EUR/USD currency pair exhibited slight upward movement due to positive market sentiment towards the euro and market anticipation of central bank remarks and economic data releases.
| SMA (20) | Slightly Rising |
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| RSI (14) | Slightly Rising |
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| MACD (12, 26, 9) | Neutral |
Closing statement: The euro showed strength against the U.S. dollar as investors awaited ECB President Christine Lagarde's speech and assessed the possibility of interest rate hikes, while the U.S. dollar remained steady amidst geopolitical concerns. Market participants also awaited upcoming U.S. economic data that could impact future interest rate decisions.
GBPUSD
- The GBP/USD currency pair experienced a 0.16% increase, reaching 1.2730. Despite the challenges indicated by the latest CBI distributive trades survey for retailers in the upcoming months, the British pound maintained some strength.
- The UK government appears likely to retract proposed tax cuts and public sector wage increases in order to address inflationary pressures.
- The dollar index declined by 0.22% to 102.510, partially reversing its 0.46% gain from the previous day.
- The core PCE index, the Federal Reserve's preferred inflation measure, is scheduled for release on Friday. This data point could have significant implications for the Fed's upcoming policy meeting in July.
- Overall, GBP/USD demonstrated a modest rise despite concerns expressed in the CBI survey. Market focus shifted to the UK government's measures to combat inflation, while the dollar experienced a slight decline ahead of the important core PCE index release.
| SMA (20) | Rising |
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| RSI (14) | Slightly Rising |
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| MACD (12, 26, 9) | Neutral |
Closing statement: GBP/USD saw a slight uptick as the British pound displayed resilience despite challenges in the retail sector. In response to rising inflation, the UK government considered revising its proposed tax cuts and public sector wage increases. Market participants also monitored the upcoming core PCE index release, which could influence the Federal Reserve's policy decisions in the near future.
GOLD
- Gold prices edged higher on Monday, benefiting from a decline in the dollar ahead of crucial inflation data that could influence the decisions of major central banks worldwide. These central banks are preparing for potential interest rate hikes.
- While the market anticipates a 25-basis point increase in the Federal Reserve's funds target rate in July, the outlook beyond that remains uncertain.
- The market has not fully priced in two additional rate hikes. Positive U.S. economic data would lead to further expectations of rate hikes, resulting in a stronger dollar.
- Market participants will have the opportunity to hear from notable figures such as ECB President Lagarde, Fed Chair Powell, and other global central bank leaders during a panel discussion at the ECB's annual forum in Sintra, Portugal. Inflation is expected to be a significant topic of discussion.
- In summary, gold prices experienced a slight upward movement due to a weakening dollar and market focus on forthcoming inflation data and central bank discussions. The market remains uncertain about the extent of future rate hikes, which will largely depend on economic indicators and central bank policies.
Closing statement: Gold prices benefited from a weaker dollar ahead of pivotal inflation data and discussions among central bank leaders. The market awaits clarity on the path of interest rate hikes, with expectations for two additional rate increases yet to be fully priced in. Investors will closely monitor economic indicators and the statements from central bank figures for further insights into the future direction of gold prices.
CRUDE OIL
- Crude oil prices experienced a slight increase on Tuesday, driven by concerns over political instability in Russia and potential supply disruptions. Additionally, hopes for increased U.S. demand ahead of the summer driving season contributed to the upward movement.
- Traders became less complacent about the continuous flow of Russian oil into the international market following recent events, leading to increased uncertainty.
- Saudi Arabia announced a unilateral cut of 1 million barrels per day, scheduled to take effect in July. This, along with the anticipated stronger demand during the third quarter, is expected to tighten the physical oil market.
- Market participants closely monitored signs of a rebound in demand for transportation fuels, particularly gasoline, in the United States as the peak summer driving season approached.
- In summary, crude oil prices saw a modest rise driven by concerns surrounding political instability in Russia, potential supply disruptions, and the anticipation of increased demand during the summer driving season. The market also reacted to Saudi Arabia's unilateral production cut, which is expected to contribute to a tightening of the market in the coming months.
| SMA (20) | Slightly Falling |  |
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| RSI (14) | Neutral | ||
| MACD (12, 26, 9) | Neutral |
Closing statement: Crude oil prices climbed on the back of geopolitical concerns in Russia, possible supply disruptions, and expectations of higher demand during the summer driving season. Traders remained vigilant about the flow of Russian oil into the international market, while also monitoring the impact of Saudi Arabia's production cut and the pickup in demand for transportation fuels, particularly gasoline, in the United States.
DAX
- Germany stocks closed with mixed results on Monday, with gains in the Retail, Food & Beverages, and Chemicals sectors driving some shares higher, while losses in the Construction, Pharmaceuticals & Healthcare, and Software sectors weighed on others.
- The DAX volatility index, which measures the implied volatility of DAX options, increased by 4.09% to reach 16.03.
- Recent economic surveys have depicted a deteriorating outlook for Germany, the largest economy in the eurozone. The Ifo business climate index released on Monday revealed a decline in German business morale.
- The eurozone is set to release preliminary inflation data for June on Friday. While the headline inflation rate is expected to moderate, underlying inflation is anticipated to rise slightly, underscoring the challenges faced by the European Central Bank (ECB).
- Overall, the DAX exhibited a mixed performance due to sector-specific gains and losses. The market remained cautious amid weakening German business sentiment and the upcoming inflation data, which could have implications for the ECB's policy decisions.
| SMA (20) | Neutral | |
| RSI (14) | Slightly Falling | |
| MACD (12, 26, 9) | Slightly Falling | |
Closing statement: The DAX index closed with a mixed outcome as different sectors experienced varied performances. The market observed heightened volatility, as reflected by the increase in the DAX volatility index. The deteriorating business climate in Germany raised concerns, while market participants awaited the eurozone's inflation data release, which could pose challenges for the ECB.