The British monthly GDP is announced on Friday at 09:00 MT time.
What drives the market on July 1?
The market sentiment is mixed. Let’s look at most interesting movements on the market today.
- The Fed’s chairman Jerome Powell claimed yesterday that the US economy entered the new phase of economic recovery sooner than expected. Encouraging US data proved that the USA is moving forward to the V-shaped recovery. US consumer confidence showed yesterday the largest increase since late 2011. However, there are still challenges ahead as the labor market is still well-below pre-crisis levels. More than 20 million Americans remain unemployed. "All levels of government" should impose stimulus measures "for as long as needed" to support the economy rebound, Powell claimed. Stocks gained.
- The Canadian GDP came better than the forecast. The indicator shrank by 11.6%, while analysts anticipated the 12.5% contraction. CAD rose.
- Virus infection are still rising in some US states. Alarming data indicated that coronavirus cases in 14 states in the USA more than doubled in June.
- Investors worry about a new national security law for Hong Kong. China imposed strict punishment measures up to life in prison for the sedition and collusion with foreign forces. Sino-American tensions escalated. Gold climbed up.
Watch our daily forex trading plan!
XAU/USD is heading towards the key psychological mark at $1,800. Just few inches left. Support levels are at $1,760 and $1,720.
The stock index rose on the optimistic speech of Jerome Powell. The price crossed the resistance at 3,075 and took a breath after that. Most analysts anticipate that the stock rally will continue further. Anyway, if risk-off factors outweigh, look for support levels at the 200-day moving average at 3,025 and then at 3,000.
The encouraging Canadian GDP pushed USD/CAD down. The pair met the support at the 100-day moving average at 1.3565. The risk-on market sentiment may push it even lower. If it breaks it down, it will clear the way towards the next support at 1.3495. Resistant levels are at 1.3605 and 1.3685.
ADP non-farm payrolls will be released at 15:15 MT time. If the data turns out better than expected, the market sentiment will improve. Follow the report!
The main market tendency today is that the US dollar is rising against its major peers and riskier assets such as stocks and oil are plummeting.
The US unemployment claims are out on Thursday at 15:30 MT time.
The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time.
Joe Biden is going to unveil a Covid-19 relief package of about $2 trillion. After this announcement, the 10-year Treasury yield rose, adding support for the USD.
The US dollar’s weakness offered a boost to emerging-market currencies and oil.