The Fed can start tapering already this November, oil is rallying pushing the Canadian dollar up! Jump in to know more!
What drives the market on September 7?
The US dollar has started the week on the positive footing after the upbeat Friday’s NFP. The greenback had steadily risen after the report. However, later on, it lost some of its gains as the US stocks reversed from huge losses. Stocks started sharply dipping down on Thursday. It happened because of the investors’ concerns over the recent tech boom, which might be overvalued. According to Bloomberg, the tech stocks’ rally wasn’t supported by the widespread investor sentiment, in the opposite, it was caused by large options trades from one company. The Financial Times claimed that SoftBank bought billions of dollars in tech derivatives ahead of the fall of the stock market. Therefore, traders now try to find out the fair price for stocks.
Let’s have a look at the S&P 500 chart. It has steeply dropped after touching the all-time high at 3 575. The stock index has just broken the key support of 3 400 and keeps falling down. If it manages to break through the next support of 3 350, which it has touched a few times during August, the way to 3 330 will be open and then to 3 315. In the opposite scenario, the move above the high of August 25 at 3 445 will drive the price towards the next resistance of 3 480.
Let’s move on to EUR/USD. The pair is dipping down amid the stronger USD and worries about the upcoming ECB meeting on Thursday, which is interested in the lower euro. The move below the significant support of 1.1800 will push the pair down to the next one at 1.1770. Otherwise, if it jumps above Friday’s high of 1.1860, the doors to 1.1900 will be open.
As for gold, the yellow metal has failed to break out the triangle so far. If it drops below the support of $1 925, it may fall even deeper to the low of August 26 at $1 910. In opposite, the move above $1 950 will be the pivotal point and will drive the pair to $1 970.
Finally, let’s discuss USD/JPY. The pair is edging higher amid the stronger greenback. If it breaks through the high of August 26 at 106.50, it will surge to the next resistance of 106.70. Otherwise, the move below the support of 106.10 will drive the price to the key psychological mark of 106.00.
Germany, the leading economy in the Euro Zone, will reveal one of the key economic indicators – German Ifo Business Climate on September 24 at 11:00 MT time.
That day has come, guys! The Fed will hold a meeting at 21:00 GMT+3. It can be a highly impactful event. The markets expect the bank to hint about the timing of tapering.
Commodities (iron ore, oil) and commodity-linked currencies (AUD, CAD) surged. West Texas Intermediate has reached $75 a barrel, while Brent rose to the highest mark since October 2018.
Although Jerome Powell’s speech sounded hawkish on Wednesday, September 22, markets did not get scared and the main stock indices got bought back…
Turkey’s central bank governor was at a crossroads: to hold interest rates and take a risk to be fired like it was for three governors before him, or to comply with the president, to cut rates, and to risk the market. Let’s find out, how to react to the rate cut.