EURUSD
- EUR/USD reacted to recent comments from central bank officials, particularly after Fed Chair Jerome Powell's hawkish testimony, which increased the probability of rate hikes in the second half of the year and resulted in a slight decline in the pair.
- ECB policymaker Martins Kazaks, who holds a more hawkish stance, stated that he foresees interest rates increasing after July and firmly dismissed market expectations of rate cuts in 2024.
- ECB President Christine Lagarde continued the hawkish rhetoric, emphasizing the need for rates to remain at restrictive levels as long as necessary. She also indicated the possibility of interest rates being higher than currently anticipated, suggesting that the ECB may not be able to confidently declare a peak in rates in the near future.
- From a technical perspective, the daily chart reveals that EUR/USD reached a six-week high, reversing the pullback observed in May but faced rejection near the 1.10 level.
- The recent price action on the daily chart shows that EUR/USD climbed to a six-week high, erasing the pullback witnessed in May. However, the pair faced rejection near the 1.10 handle, indicating potential resistance at that level.
| SMA (20) | Rising |
|
| |
| RSI (14) | Neutral | |||
| MACD (12, 26, 9) | Slightly Rising |
|
Closing statement: EUR/USD reacted to central bank comments, with the pair experiencing a slight decline following Jerome Powell's hawkish testimony. ECB policymakers, including Martins Kazaks and Christine Lagarde, maintained a hawkish stance, signaling the likelihood of interest rate increases and the need for restrictive levels. From a technical perspective, EUR/USD climbed to a six-week high but faced resistance near the 1.10 handle.
GBPUSD
- The upcoming policy panel discussion at the Sintra event in Portugal will feature prominent figures such as Andrew Bailey (Governor, Bank of England), Christine Lagarde (President, European Central Bank), Jerome Powell (Chair, Board of Governors of the Federal Reserve System), and Kazuo Ueda (Governor, Bank of Japan).
- Market participants will closely analyse their comments for insights into their respective monetary policy agendas.
- GBP/USD has been trading within a descending channel over the past 10 days, following resistance encountered at 1.2850.
- Despite the short-term downtrend, the longer-term bias for GBP/USD remains tilted to the upside, as the ascending channel originating from the September 2022 lows continues to exert influence.
- The policy panel discussion at the Sintra event in Portugal, featuring prominent central bank figures, will attract significant attention as market participants closely analyse their comments for hints on future monetary policy agendas and potential market implications.
| SMA (20) | Rising |
|
|
|
| RSI (14) | Slightly Falling |  |
||
| MACD (12, 26, 9) | Neutral |
Closing statement: GBP/USD traders are eagerly awaiting the policy panel discussion at the Sintra event, where influential figures from central banks, including the Bank of England, European Central Bank, Federal Reserve System, and Bank of Japan, will convene. Market participants will closely scrutinize their remarks for insights into their respective monetary policy directions. From a technical standpoint, GBP/USD has been trading within a descending channel, but the longer-term bias remains tilted to the upside, supported by the prevailing ascending channel since September 2022.
GOLD
- Gold prices showed minimal movement on Wednesday, remaining near three-month lows, as market participants awaited an address by Federal Reserve Chair Jerome Powell and monitored the central bank's preferred inflation gauge.
- Currently, gold is struggling to maintain its position, hovering close to the three-month low around $1,910.
- Further insights into U.S. inflation will be revealed this week, particularly with the release of the personal consumption expenditures price index for May on Friday. This index is the Fed's preferred measure of inflation and is expected to remain stable after an unexpected increase in April.
- Market sentiment reflects a probability of over 75% for the Fed to raise interest rates by 25 basis points in July, with another similar rate hike expected later in the year.
- The uncertain environment and anticipation surrounding Jerome Powell's address, coupled with the upcoming inflation data, are contributing to cautiousness among gold traders.
Closing statement: Gold prices experienced limited movement, trading near three-month lows, as traders awaited Jerome Powell's address and closely monitored the Fed's preferred inflation gauge. Gold struggled to maintain its position around $1,910, and market sentiment suggests a high probability of interest rate hikes by the Fed. The upcoming release of U.S. inflation data adds to the cautious environment surrounding gold trading.
CRUDE OIL
- Crude oil prices saw a modest increase on Wednesday as industry data revealed a larger-than-expected decline in U.S. inventories, indicating strong demand from the world's largest oil consumer. However, concerns over potential interest rate hikes limited the extent of the gains.
- Russia's energy ministry assured that there is no shortage of gasoline in the domestic market. Companies have adjusted their exports and ramped up production after completing planned maintenance work.
- According to market sources citing data from the American Petroleum Institute, crude stocks decreased by approximately 2.4 million barrels in the week ending June 23, surpassing analysts' expectations of a 1.76 million barrel drawdown.
- Investors await the release of U.S. government data on stockpiles by the Energy Information Administration (EIA), which will provide additional insights into the supply levels and overall market dynamics.
- The combination of robust demand reduced exports, and a larger-than-expected drawdown in inventories suggests a positive outlook for the crude oil market, despite concerns over interest rate hikes.
| SMA (20) | Slightly Falling | |
|
| RSI (14) | Neutral | ||
| MACD (12, 26, 9) | Slightly Falling | |
Closing statement: Crude oil prices experienced a slight uptick driven by the larger-than-anticipated decrease in U.S. inventories, reflecting robust demand from the world's leading oil consumer. The reassurance of no gasoline shortage in the domestic market by Russia's energy ministry further supported market sentiment. Attention now turns to the forthcoming release of U.S. government data on stockpiles, which will provide further clarity on the current supply levels and help shape the future direction of crude oil prices.
DAX
- European shares rose on Wednesday, supported by robust U.S. data that alleviated concerns of a sharp economic slowdown. Investors looked forward to insights from central bankers at a forum later in the day to gain further guidance on monetary policy.
- Germany stocks displayed a mixed performance on Tuesday, with gains in the Retail, Transportation & Logistics, and Food & Beverages sectors driving shares higher, while losses in the Construction, Pharmaceuticals & Healthcare, and Technology sectors weighed on performance.
- Among the top performers on the DAX were Zalando SE, which increased by 2.39% or 0.65 points to close at 27.80, Siemens Energy AG, which added 2.30% or 0.33 points to end at 14.68, and Commerzbank AG O.N., which rose 2.13% or 0.20 points to reach 9.80 in late trade.
- On the downside, Sartorius AG VZO O.N. recorded the largest decline, falling by 5.13% or 15.80 points to trade at 291.90 at the close. Merck KGaA declined by 3.54% or 5.40 points, ending at 147.20, and Qiagen NV decreased by 2.25% or 0.93 points, closing at 40.49.
- Market participants eagerly followed a panel discussion of central bankers in Sintra, featuring European Central Bank President Christine Lagarde, Federal Reserve Chair Jerome Powell, and Bank of Japan Governor Kazuo Ueda. Their remarks and insights were anticipated to provide valuable information for investors.
| SMA (20) | Neutral | ||
| RSI (14) | Rising |
|
|
| MACD (12, 26, 9) | Slightly Falling | |
Closing statement: European shares gained ground, propelled by positive U.S. economic data, allaying concerns about a significant economic slowdown. The DAX index displayed a mixed performance, with certain sectors driving gains while others faced losses. The panel discussion of central bankers in Sintra, which included prominent figures such as Christine Lagarde, Jerome Powell, and Kazuo Ueda, attracted significant attention as investors sought further guidance on monetary policies and their potential impact on the market.