2022-12-15 • Updated
Last week was intense!
The US dollar gained more than 2% against other currencies on investors' concerns regarding one more inflation wave in the United States caused by the fuel crisis. As a result, EURUSD plunged to 1.06 support, and USDJPY increased to 134. The stock market lost over 2% on Thursday as investors decided to quit risk assets ahead of the upcoming FOMC meeting on June 15. Chinese Hang Seng decreased at the end of the week as Shanghai closed seven districts for weekends for Covid testing. The oil market keeps gaining momentum due to the Russian oil embargo. As a result, XBRUSD increased above $122 and continues its journey towards $130.
The Bureau of Labor Statistics will publish the US PPI and Retail Sales numbers on Tuesday and Wednesday, respectively. Moreover, on Wednesday, the FOMC will host a meeting to discuss the future monetary policy and increase the key rate. According to analysts’ expectations, the Federal Reserve might increase the key rate by 75 basis points, due to another wave of inflation growth. In this case, EURUSD might decline to 1.0350. Otherwise, it will bounce to the 1.0550 resistance level.
An extremely high inflation rate already reduced real income by 20% in Great Britain, causing unrest among the population. On Thursday, the Bank of England will publish its monetary policy summary. If BOE doesn’t make any hawkish statements, GBPUSD might plunge to 1.2200 support and even decline to 1.2050 in case of a breakout.
The US stock indices had a rough close of the previous week due to the US dollar’s growth. However, both US500 and US100 keep trading above the critical key levels of 3800 and 11 700, respectively. Traders might consider opening long trades as long as the price stays above these levels.
Chinese Hang Seng reversed from the 100-day moving average after a 4-day rally due to the COVID-19 cases growth in Beijing. The price might return to 19 000 within a couple of weeks.
XBRUSD has been breaking one resistance level after another. Currently, the price has only one barrier of $124.50 before reaching $130. At the same time, XTIUSD is moving towards $124. There are a few doubts oil will hit targets as it looks like even OPEC+ doesn’t have enough power to resolve the energy crisis.
XAUUSD surprised everyone on Friday reaching the $1880 level. However, it declined at the beginning of the week. The breakout of the $1850 support level will send the yellow metal at $1830.
The upcoming August inflation data may send mixed signals. The 12-month headline inflation rate is expected to rise to 3.6%, causing concerns for the Biden administration. However, core inflation, which excludes food and energy prices, is projected to decrease to 4.3%, aligning with the Federal Reserve's goals. Past price trends influence both figures, so looking at recent data for a more accurate picture is crucial.
The odds of a final interest rate hike by the US Federal Reserve (Fed) this year have dropped after US job openings hit their lowest levels since early 2021. This has led to a correction in the US Dollar as traders reduced their bets on further rate hikes.
Here we go again, my friends. It’s time to look critically into the future of what trading opportunities September might have in store for us. As always, it is essential to note that the views expressed here are mine and should not be considered financial advice without proper examination.
The past several weeks have been a real triumph for the bulls in the oil market. The Brent spot price grew by 8.5% during the last month.
Gold prices are rising for three consecutive days ahead of the Federal Reserve (Fed) interest rate decision, which is expected to remain unchanged due to declining inflation and a positive economic outlook. Investors are keen on the Fed's interest rate guidance, fearing a hawkish stance that could trigger market risk aversion.
Amid concerns of a Chinese economic slowdown, reports of declining investment often overlook China's efficient investment strategy in emerging sectors for long-term growth. China has taken measures to stabilize foreign and private sector investments, like reducing the reserve requirement ratio to boost investor confidence.
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