The Fed held a much-awaited meeting yesterday. The bank hasn’t made any policy changes. As a result, the USD weakened and EUR/USD rocketed. Jump in to know all the latest news!
Optimism faded, gold surged
- China’s economic data came out better than expected. Industrial output, retail sales, and jobless rate has shown the country is steadily recovering. USD/CNH rose at the start of the day, but it has started to move down already.
- US officials has failed to deliver the expected $908 billion relief package so far, but Joe Biden confirmed that leaders in Congress should get one or both parts through the House and Senate by the end of the year.
- Gold is edging higher ahead of the Fed’s last meeting this year. It will be held on Wednesday at 21:00 MT time. According to Bloomberg, gold may get the support via the weaker USD after the Fed meets as the central bank may ease monetary policy.
- First shots of vaccine have been distributed in the USA, but the constantly rising cases worsened the market sentiment. New York City Mayor said Americans to get ready for a full shutdown. European governments are also tightening measures.
EUR/USD is moving in an uptrend. It has approached the key resistance of 1.2170, which it has failed to break a few times already. If it jumps above it, the way up to the next round number of 1.2200 will be clear. On the flip side, the pair is unlikely to break the 50-period moving average of 1.2130 as it has been nicely supporting the pair since November. The Fed’s meeting on Wednesday will have a huge impact on the pair.
The British pound regained its recent losses. GBP/USD is trading inside ascending channel. If it jumps above the key resistance of 1.3400, the way up to the high of December 3 at 1.3460 will be clear. On the flip side, the move below the recent lows of 1.3300 will push the pair to the next support of 1.3200.
XAU/USD has approached the level of the recent highs at $1 845. Since it has failed to cross it several times, we can expect the pullback. If it manages to break it through, the way up to the high of December 8 at $1 870 will be clear. Support levels are $1 810 and $1 770.
The Australian dollar dipped amid the risk-off market sentiment. It is getting closer to the key psychological mark of 0.7500. It’s unlikely to break it by the first attempt, therefore we may see a retracement. If it finally drops below 0.7500, the way down to the 50-period moving average of 0.7470 will be open. Resistance levels are 0.7580 and 0.7600.
What will happen? The US Q2 Gross Domestic Product will be announced at 15:30 MT time (GMT+3) on Thursday, July 29…
Today the Fed will make a policy statement at 21:00 GMT+3. This event will affect all the currency pairs with the USD and thus almost the all Forex market!
The Reserve Bank of Australia (RBA) will hold a meeting and announce changes to the monetary policy on August 3, at 07:30 MT time (GMT+3).
What events to follow and how to trade during the week of July 2-6?
EUR/USD retraced to 1.1870 after breaking out this level. It should be just a natural sell-off ahead of the further rally up.