Non-Farm Payrolls data will be released on Thursday at 15:30 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.
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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 Reserve Bank of Australia will publish its statement and announce the interest rate on July 7, at 7:30 MT time.
The overall market sentiment was mixed after the USA recorded the largest increase in virus cases since May 9. The data even offset the better-than-expected NFP.
The risk-on tone is back on the market again. Let’s look at main trading opportunities.