Forex Analysis by LiteForex

[MikhailLF]

Morning Market Review

EUR/USD

EUR shows a downtrend against USD during today's Asian session, continuing the correctional decline which started the day before when the instrument retreated from its local highs since June 11. The appearance of the "bearish" trend was driven by concerns about the rapid increase in the number of new cases of coronavirus in the United States, as well as yesterday's publication of good macroeconomic statistics from the USA. Initial jobless claims for the week ending July 3 decreased from 1.413M to 1.314M, which was better than market expectations. Continuing Jobless Claims for the week ending June 26 decreased from 18.76M to 18.062M, which also turned out to be better than the forecast of 18.95M.

GBP/USD

GBP is lowering against USD during trading at today's Asian session. The instrument retreats from its local highs, updated the day before, being under pressure from technical factors, while the overall picture on the market changes slightly. GBP is still supported by rumors of marked progress on the issue of a trade agreement between the UK and the EU. In addition, investors responded positively to the UK Treasury Secretary's plan for additional support to the British economy, presented on Wednesday. USD, in turn, is strengthening as a safe haven currency, since the latest statistics on the dynamics of the incidence of coronavirus in the US and the world cause more and more anxiety and concern.

NZD/USD

NZD is going down against USD during today's morning session, retreating from local highs, updated on Thursday. The decrease in the instrument is of technical nature, since not much interesting macroeconomic statistics is published. In addition, the demand for safe assets is rising amid a sharp increase in the number of cases of COVID-19 in the United States. Despite record incidence rates, the US authorities are in no hurry to return to quarantine restrictions, so it is not yet clear how soon it will be possible to take control of the new outbreak of the epidemic. New Zealand macroeconomic statistics released on Friday do not have a significant impact on the dynamics of the instrument. Electronic Card Retail Sales in June grew by 8% YoY after a decrease of 6% YoY last month.

USD/JPY

USD shows a steady decline against JPY during today's Asian trading session, updating local lows since June 26. The instrument loses about 0.25%, testing the level of 107.00 for a breakdown. USD is falling against JPY amid a timid correctional growth attempt at the end of the week against many of its other competitors. The disturbing statistics on the dynamics of the incidence rate in the USA are affecting, which threatens the return of new quarantine restrictions and additional measures to support the economy. On Friday, JPY is supported by macroeconomic statistics published in Japan. In June, the Producer Price Index increased by 0.6% MoM after a decline of 0.5% MoM in the previous month. Analysts had expected growth of 0.4% MoM. In annual terms, the index for the same period decreased by 1.6% YoY after rising by 2.8% YoY a month earlier. Analysts had expected decline by 1.9% YoY.

XAU/USD

Gold prices are falling, retreating from their record highs. The instrument is testing an important psychological level of 1800.00 for a breakdown. The appearance of the "bearish" trend is due to the general strengthening of USD in the market, as well as technical factors for correcting long profit. At the same time, the continuing geopolitical risks, as well as the rapid increase in the number of new cases of coronavirus, provide significant support to gold. Against the backdrop of record incidence rates in the United States, analysts believe that the recovery of the US economy may slow down significantly, and authorities will be forced to return some quarantine restrictions and announce additional measures to support the national economy.

 

[MikhailLF]

EUR/USD

EUR has shown steady growth against USD during today's Asian session, recovering from a decline last Thursday from new local highs since June 11. The recovery of the "bullish" trend of the instrument is due to optimistic investor sentiment regarding the prospects for the European economy. In addition, alarming statistics on the incidence of coronavirus in the United States puts significant pressure on USD. Analysts believe that the growth rate of the US economy will be significantly lower than previously calculated values, which will reduce the economic gap between the US and the eurozone. Today's trading is likely to be fairly calm, given the semi-empty macroeconomic calendar. Attention should be paid only to the speech of the FOMC member John Williams, as well as the publication of the US Federal Budget Balance for June.

GBP/USD

GBP continues moderate growth against USD during today's morning trading, updating local highs since June 16. GBP takes advantage of the weak USD, which is under pressure from alarming statistics on the coronavirus. In addition, British investors are optimistic about the prospects for a trade agreement between the EU and the UK. Friday's US statistic was worse than expected. The Producer Price Index in June showed a decline of 0.8% YoY, while investors predicted a drop of only 0.2% YoY. In monthly terms, the production inflation indicator fell by 0.2% MoM against the forecast for growth of 0.4% MoM. Today, investors expect the speech of the head of the Bank of England, Andrew Bailey, who may present new forecasts for the British economy in the near future.

AUD/USD

AUD is showing insignificant growth against USD during today's Asian session, recovering from a "bearish" end of trading last week. Investors are buying AUD amid taking a short profit on the instrument, while fundamentally the picture is changing little. Moderate support for the pair is provided by the gradual recovery of the global economy; however, alarming data indicating a sharp increase in the incidence of coronavirus, inhibit the growth of "bullish" sentiment. USD, however, also does not receive significant support from the deterioration of the epidemiological situation in the world. Interesting macroeconomic statistics from Australia will appear on Tuesday, when the data from the National Bank of Australia on business sentiment in June will be published.

USD/JPY

USD shows flat dynamics against JPY during today's Asian session. Investors are cautious against the backdrop of growing alarming statistics on the incidence of COVID-19 in the world. The US continue updating record highs of daily infections, but in many other countries, the situation is gradually deteriorating as well. Published macroeconomic statistics from the United States and Japan are often worse than market expectations, but traditionally more attention is drawn to American data. Slight support for JPY on Monday is provided by Tertiary Industry Activity Index. In May, indicator decreased by 2.1% MoM, while in April the index showed a decrease of 6% MoM.

XAU/USD

Gold prices are rising at the beginning of the week, again located above 1800.00. Support for the instrument is still provided by a new surge in the incidence of coronavirus, which has led to an increase in demand for safe assets. The most alarming situation is in the USA, where the number of daily infections exceeded a record high of 60 thousand people. Additional support for gold was provided by a decrease in the yield of ten-year treasury bonds in the USA to the minimum values since April of this year.

 

[MikhailLF]

Morning Market Review

EUR/USD

EUR shows flat trading dynamics against USD during today's Asian session, consolidating near 1.1340 after active growth the day before. The growth of EUR at the beginning of the week was of a technical nature, while there are still not many fundamental factors for the uptrend in the instrument. European investors today are focused on the statistics on consumer inflation in Germany in June. In annual terms, inflation retained the same rate of growth (0.9% YoY). In addition, ZEW Institute will report on the dynamics of business sentiment in Germany for July. In the eurozone, the data on industrial production for May, as well as a Bank Lending Survey will be released.

GBP/USD

GBP shows ambiguous dynamics of trading during today's morning session. The instrument is consolidating at 1.2550 after an active decline the day before, which interrupted the short-term upward rally for the instrument. GBP retreated from its monthly local highs amid the taking of long profits, while Monday's macroeconomic background remained rather meager. In addition, the negative factors associated with the rapid increase in new cases of COVID-19 infections dominate the market, which reduces investor interest in risk. Today, May statistics on the dynamics of GDP and industrial production in the UK was released. The British economy showed growth of 1.8% MoM in May after a decline of 20.4% MoM in April. Industrial production in May grew by 6.0% MoM. However, these positive statistics cannot provide serious support to GBP just yet.

AUD/USD

AUD is trading ambiguously during today's Asian session, located near 0.6950. AUD is under pressure against the background of the corrective growth of USD, which is strengthening at the beginning of the week due to technical factors. Today's macroeconomic statistics from Australia provide additional support to the instrument. National Australia Bank's Business Confidence in June rose from –20 to 1 point, while analysts expected a sharp decline to –87 points. National Australia Bank's Business Conditions for the same period strengthened from –24 to –7 points, which also turned out to be significantly better than market forecasts of –39 points. Interesting publications in Australia are expected on Thursday when the June labor market report is released.

USD/JPY

USD shows flat dynamics against JPY during today's Asian session. Having shown quite active growth the day before, and having retreated from local lows of last Friday, USD does not get noticeable support in the market, since fundamentally the picture is changing little. Development of the "bullish" trend on the instrument on Tuesday is promoted by poor macroeconomic statistics from Japan. Industrial Production in May decreased from –25.9% YoY to –26.3% YoY, which turned out to be worse than neutral forecasts. In monthly terms, the production rate decreased by 8.9% MoM after a decline of 8.4% MoM in the previous month. At the same time, the percentage of Capacity Utilization decreased by 11.6% after falling by 13.3% in April.

XAU/USD

Gold prices are falling slightly this morning, developing flat trading dynamics in the short term. The instrument is still located near its record highs and is testing the level of 1800.00 for a breakdown. Support for gold is provided by growing market uncertainty associated with a sharp increase in the dynamics of the incidence of coronavirus in the United States, Brazil, India and several other countries. Investors are looking forward to the news regarding a possible vaccine against the virus, which is currently actively being developed by several states and private companies. The difficult geopolitical situation in the world also adds to the negative background. Earlier, Donald Trump said that he is not considering the prospect of resuming trade negotiations with China so far.

 

[MikhailLF]

Morning Market Review

EUR/USD

Today, during the Asian session, the EUR/USD pair shows ambiguous dynamics. Now, the euro is trying to consolidate above 1.1400, although at the opening of trading, the instrument renewed its local highs of June 10, touching the level of 1.1422. EUR’s technical factors for growth stays relatively strong, while increasing market tension in response to the confrontation between the US and China, as well as the rapid growth of new cases of COVID-19 infection, significantly inhibit investor interest in risk. Tuesday’s macroeconomic statistics from Europe was ambiguous. May industrial production increased by 12.4% MoM after a decrease of 18.2% MoM for the previous month. Analysts had expected an increase of 15% MoM. The index of moods in the business environment of Germany from the ZEW Institute for July fell from 63.4 to 59.3 points, which was worse than forecasts of 60 points.

GBP/USD

Today, during the Asian session, the GBP/USD pair is growing slightly, recovering from the “bearish” start of the week. The reason for the pound's decline on Tuesday was poor data on the dynamics of UK GDP, which was noticeably worse than market expectations. So, according to the results of May, the indicator rose only by 1.8% MoM after a decrease of 20.3% MoM in the previous month. Experts counted on an increase in GDP of 5% MoM. At the same time, industrial production in May increased by 6% MoM after falling by 20.2% MoM in April. Production in the manufacturing industry rose by 8.4% MoM, which was much better than experts' forecasts, who expected a decrease of 20.9% MoM. On Wednesday, investors are focused on a block of British data on the dynamics of consumer and industrial inflation for June.

AUD/USD

Today, during the Asian session, the AUD/USD pair is strengthening, renewing local highs from June 10. The instrument retries to consolidate above the level of 0.7000 with the support of poor positions of the American currency. At the same time, demand for USD remains quite high, given the growing geopolitical risks, as well as the difficult epidemiological situation in the world. In particular, this week, California was forced to once again suspend the work of all enterprises and change the plan to open schools in the new school year. AUD is under the pressure of today’s Westpac consumer confidence index. In July, the indicator decreased by 6.1% MoM after rising by 6.3% MoM a month earlier.

USD/JPY

Today, during the Asian session, the USD/JPY pair shows ambiguous trading dynamics, consolidating near 107.25. Investors are focused on the Bank of Japan interest rate decision. As expected, the regulator did not change the parameters of its monetary policy. The rate remained at -0.1% and the program of annual redemption of securities stayed at 12 trillion yen. In the accompanying statement, the regulator noted the high risks associated with the spread of new coronavirus infection and emphasized the willingness to take additional measures if necessary. With the opening of the American trading session, the focus of investors will shift to data from the United States. In particular, traders will be interested in the June dynamics of industrial production. Closer to the end of the afternoon session, the Fed will publish a monthly economic review, the so-called Beige Book.

XAU/USD

Today, during the Asian session, gold prices show flat dynamics, consolidating near the level of 1800.00, above which the instrument managed to consolidate yesterday. Support for the instrument is still provided by tensions between the USA and China, as well as the extremely alarming situation around the growing number of new cases of COVID-19. Earlier, China said it would impose retaliation against the United States for Washington’s recent Hong Kong bill. After Beijing approved the bill on national security, US President Donald Trump is trying to achieve the abolition of the "special status" of Hong Kong and in every possible way accuses China of discrimination and violation of civil rights. Insignificant support to the dollar, in turn, is provided by yesterday’s macroeconomic statistics. Thus, the consumer price index for June rose by 0.6% MoM after a decrease of 0.1% MoM in the previous month. Analysts had expected an increase of 0.5% MoM. The inflation for June increased by 0.6% YoY, accelerating relative to the previous value of +0.1% YoY.

 

[MikhailLF]

Morning Market Review

EUR/USD

EUR shows flat dynamics of trading against USD during today's Asian session, consolidating near the level of 1.1400. Yesterday, EUR repeatedly renewed local highs since March 10, rising to the level of 1.1451, which was facilitated by the growth of investor interest in risk. With the opening of the American trading session, USD managed to strengthen slightly, having received support from macroeconomic publications from the United States. Industrial Production in the USA in June grew by 5.4% MoM after an increase of 1.4% MoM in the previous month. Analysts had expected growth of 4.3% MoM. Capacity Utilization for the same period grew from 65.1% to 68.6%, which also turned out to be better than the forecasts of 67.7%. Today, investors are focused on the ECB decision on interest rates, as well as a follow-up press conference, at which updated forecasts on the economy of the eurozone are likely to be presented.

GBP/USD

GBP is slightly decreasing against USD, maintaining the multidirectional dynamics of trading prevailing in the ultra-short term. The macroeconomic statistics from the UK published yesterday provided some support to the instrument; however, with the opening of trading in the US, the sentiment changed again. One way or another, investors were optimistic about the appearance of data on consumer inflation. In June, the Consumer Price Index accelerated from +0.5% YoY to +0.6% YoY, which turned out to be better than the forecast for a slowdown to +0.4% YoY. In monthly terms, the indicator increased by 0.1% MoM after zero dynamics last month.

AUD/USD

AUD is falling against USD during today's Asian session, retreating from strong resistance at 0.7000. On Thursday, Australian investors are focused on the publication of the report on the Australian labor market in June. Part-Time Employment in June grew by 249K jobs after a decrease of 162.3K in the previous month. At the same time, Full-Time Employment reduced by 38.1K after a decrease of 101.9K a month earlier. Employment Change in June increased by 210.8K, which turned out to be almost twice as good as market expectations. Unemployment Rate increased from 7.1% to 7.4%, which coincided with the expectations of investors. Participation Rate has grown from 62.7% to 64%, exceeding forecasts of 63.6%.

USD/JPY

USD again demonstrates flat trading dynamics against JPY during the morning session, consolidating near 107.00. Support for JPY is provided by continued demand for safe assets, while USD remains in the spotlight due to the raging coronavirus epidemic in the United States. Today, the data on the Retail Sales in the US for June is expected to be published. In addition, updated information on Initial Jobless Claims is expected (for the week ending July 10).

XAU/USD

Gold prices show flat dynamics, however, they continue to stay near their record highs, receiving support against the backdrop of prevailing market uncertainty. The growth of geopolitical tensions between the US and China, as well as the difficult epidemiological situation in the world contributes to an increase in demand for safe assets. In addition, investors expect that amid worsening incidence dynamics, many financial regulators will again have to resort to additional stimulation of their economies, which will further increase the attractiveness of gold. Additional pressure on USD is exerted by a corporate reporting season which started recently.

 

[MikhailLF]

Morning Market Review

EUR/USD

EUR shows ambiguous dynamics against USD during today's Asian session, having retreated from local highs the day before. The "bearish" dynamics on Thursday was facilitated by correctional sentiment, as well as by quite positive macroeconomic statistics from the United States. US Retail Sales in June grew by 7.5% MoM after an increase of 18.2% MoM in the previous month. Analysts had expected increase by 5% MoM. Philadelphia Fed Manufacturing Survey in July fell from 27.5 to 24.1 points, which also turned out to be better than market forecasts of 20 points. On Thursday, EUR was under some pressure from the results of the ECB meeting. As expected, the European regulator kept all the key parameters of its monetary policy unchanged. At the same time, ECB President Christine Lagarde again called on European governments to make every effort to develop new measures of economic support.

GBP/USD

Today, GBP demonstrates flat dynamics of trading against USD, continuing the development of the lateral trend in the short term. The day before, GBP showed a moderate decline, which was a reaction to the technical growth of USD, while the macroeconomic background remained almost unchanged. On Thursday, British investors were focused on the report on the UK labor market. Claimant Count Rate in June fell from 7.4% to 7.3%. Claimant Count Change for the same period unexpectedly decreased by 28.1K after an increase of 566.4K in the previous month. Analysts had expected an increase of 250K. ILO Unemployment Rate in May remained at the previous level of 3.9% 3MoY, which did not justify the negative forecasts of analysts about the growth of the indicator to 4.2% 3MoY.

AUD/USD

AUD is strengthening against USD during today's morning trading, testing the level of 0.7000 for a breakout again. Having demonstrated a moderate decline the day before, the instrument is trying to return to previous levels, receiving support from the weakness of USD and good macroeconomic publications from China and Australia. China reported GDP growth in Q2 2020 by 3.2% YoY and 11.5% QoQ, which was better than market expectations of +2.1% YoY and +9.6% QoQ. Australian data showed steady increase in Employment Change in June by 210.8K, but the Unemployment Rate still rose significantly from 7.1% to 7.4%, which met expectations.

USD/JPY

USD shows flat dynamics against JPY during today's Asian session, trying to consolidate above 107.00. The instrument showed moderate growth the day before, having received support from fairly positive macroeconomic statistics from the United States on the dynamics of retail sales, but the general sentiment of investors remains ambiguous. Uncertain prospects for the recovery of the American economy against the backdrop of the ongoing deterioration of the epidemiological situation in the world put significant pressure on USD. Only some progress in the development of a vaccine against coronavirus can be called a positive point, but it is obvious that in such a short period of time it is not possible to develop a full-fledged vaccine.

XAU/USD

Gold prices show ambiguous trading during today's morning session, having shown a moderate decline in trading yesterday. The instrument is trying to consolidate below the key level of 1800.00 again; however, the demand for gold remains quite high. The instrument is supported by an uncertain market situation related to the aggravation of geopolitical risks and the further worsening of the epidemiological situation in the world. The United States and China again exchange mutual sanctions, and this threatens with crossing out all the progress made earlier in the framework of the trade agreement. While global regulators are taking a wait and see attitude, new measures to support the economy today seem quite reasonable, which also increases the attractiveness of gold among investors.

 

[MikhailLF]

Morning Market Review

EUR/USD

EUR has shown moderate growth against USD during today's Asian session, again approaching its highs since early March, updated on July 15. EUR ended last week's trading with moderate growth, receiving support from weak USD. At the end of the week, USD was under pressure from disappointing consumer confidence data. Michigan Consumer Sentiment Index in July fell from 78.1 to 73.2 points, while analysts had expected growth to 79 points. Today, European investors are focused on the publication of data on Producer Price Index from Germany for June. Also, German Bundesbank Monthly Report is expected during the day.

GBP/USD

GBP declines against USD during today's morning trading, preparing to test 1.2500 for a breakdown again. Investors are selling GBP amid the publication of mixed macroeconomic statistics from the UK and uncertain prospects. Last week, the UK reported on the growth rate of GDP, which in May was significantly worse than market expectations. In this regard, analysts believe that the previously adopted measures to support the country's economy may not be enough and soon the Bank of England will be forced to return to the issue of new incentives. Investors are also concerned about the prospect of a trade agreement between the UK and the EU, which should be signed before the end of the year. Due to the pandemic, no notable progress on the issue was achieved, despite a series of very optimistic statements by officials.

NZD/USD

NZD shows ambiguous dynamics of trading against USD during today's Asian session, located near the opening level of 0.6550. Investors expect new drivers to appear on the market to form trends for the instrument, but so far NZD has not been able to demonstrate growth even against the backdrop of strong macroeconomic signals. Last Friday, Business NZ PMI in June rose sharply from 39.7 to 56.3 points against the forecast of a decrease to 35.6 points. Today, attention is drawn to Business NZ Performance of Services Index. In June, the indicator increased from 37.2 to 54.1 points, which also turned out to be better than the market's average expectations. In turn, USD remains under pressure from alarming statistics on the incidence of coronavirus and uncertain prospects around the upcoming US presidential elections scheduled for autumn.

USD/JPY

USD shows moderate growth against JPY during today's Asian trading. The instrument adds more than 0.20% and is testing the level of 107.30 for a breakout. Pressure on JPY on Monday is exerted by weak statistics on exports. In June, exports from Japan decreased by 26.2% YoY after a decrease of 28.3% YoY in the previous month. Analysts had expected decline by 24.9% YoY. Imports for the same period fell by 14.4% YoY, which turned out to be better than forecasts of –16.8% YoY and previous dynamics at the level of –26.2% YoY. The trade balance in June showed a deficit of 268.8B yen, which turned out to be significantly worse than market expectations of –35.8B yen. In May, the balance showed a deficit of –833.5B yen.

XAU/USD

Gold prices are stable at the beginning of the new week and are trying to consolidate above 1800.00. The instrument recovered noticeably in trading last Friday, receiving support from the continuing risk aversion of investors. The United States again reported a record increase in new cases of coronavirus infection, which raises doubts about the previously announced pace of the American economic recovery. The country has not announced the return of large-scale quarantine measures, but some states are forced to lock down, which could lead to a sharp deterioration in the labor market. An additional source of market uncertainty is the relationship between the United States and China. The parties continue to exchange mutual sanctions, and at the end of last week it became known that Donald Trump's administration is considering the possibility of banning persons associated with the activities of the Chinese Communist Party from entering the United States.

 

[MikhailLF]

Morning Market Review

EUR/USD

EUR is falling against USD during today's Asian session, retreating from local highs of March 10, updated at the beginning of this trading week. Uncertain macroeconomic statistics from Germany put some pressure on EUR yesterday. Producer Price Index in Germany in June showed zero dynamics on a monthly basis, while analysts had expected growth in manufacturing inflation by 0.2% MoM. On an annualized basis, the indicator decreased by 1.8% YoY after falling by 2.2% YoY, which also turned out to be worse than market expectations of –1.5% YoY. In turn, USD remains under pressure amid decisions on new measures to support the US economy, which are due later this week.

GBP/USD

GBP is trading with multidirectional dynamics during today's Asian session, consolidating near new local highs and the level of 1.2650, which were renewed thanks to the activity of the "bulls" the day before. A confident uptrend on the instrument was facilitated by technical factors, as well as by the weakness of USD. GBP, in turn, looks good enough against the background of the latest macroeconomic statistics, as well as moderate optimism about Brexit and the accompanying trade agreement between the UK and the EU. Today British investors are awaiting the publication of information on the placement of 30-year government bonds.

AUD/USD

AUD is showing moderate growth during today's morning trading session, trying to consolidate above the important resistance at 0.7000. On Tuesday, investors are focused on the minutes of the RBA meeting, as well as the speech of the Governor of the regulator Philip Lowe. The bank Governor began his speech with a description of a rather difficult situation in the labor market, which was sharply aggravated against the backdrop of the outbreak of the COVID-19 epidemic. Toward the end of his speech, Lowe tried to cheer up investors and noted that Australia coped with the challenges of the new time much better than many countries and remained open to investment and innovation.

USD/JPY

USD has shown moderate gains against JPY during today's Asian session, aiming to consolidate above 107.30. A number of technical factors contribute to the growth of the instrument, as well as restrained optimism about the coronavirus vaccine under development. Meanwhile, JPY gets moderate support from macroeconomic publications from Japan on Tuesday. The National Consumer Price Index in June showed an increase of 0.1% YoY, maintaining the dynamics of the previous month. Analysts had expected the indicator to slow down to zero. National CPI excluding Food and Energy increased by 0.4% YoY over the same period, which also turned out to be slightly better than analysts' expectations of +0.3% YoY.

XAU/USD

Gold prices are trading flat during today's Asian session, close to multi-year highs, which are constantly updated amid uncertain market conditions. Traders are seriously concerned about the continuing rise in the global incidence of coronavirus. In addition, investors expect the adoption of new measures stimulating economy by the world's leading regulators. In particular, the US government is expected to agree on a new package of assistance to the American economy this week, and the EU, meanwhile, managed to agree on the creation of a recovery fund in the amount of EUR 750B.

 

[MikhailLF]

Morning Market Review

EUR/USD

EUR is trading with an uptrend against USD during today's Asian session, hitting record highs since January 2019. Until now, EUR has shown three "bullish" trading sessions, which have led the instrument to new record highs. The growth of optimism was triggered by the expectations of investors regarding the creation of a fund to help the European economy in the amount of EUR 750 billion. After lengthy discussions, the long-awaited plan was approved by the European leaders, and the market was even more inspired, especially given the high risks of a further increase in the incidence of COVID-19. Today, investors are focused on the statistics on the dynamics of Existing Home Sales in the United States. Interesting data from Europe will appear only towards the end of the week. On Friday, consolidated statistics on business activity in the eurozone from Markit for July is expected to be released.

GBP/USD

GBP shows the flat dynamics of trading against USD during today's morning session. The instrument is retreating from its monthly highs, updated the day before, without the support of the previous drivers. Approval of the European economic support program in the amount of EUR 750 billion does not provide almost any support to GBP. In turn, the "bullish" activity on the instrument has noticeably decreased after the information that the UK and the EU are unlikely to have time to agree on a trade agreement before the end of the summer appeared at the market. Analysts believe that the process could drag on until the end of the year, when the Brexit transition deadline expires. Today investors do not expect interesting drivers from the UK to appear, and therefore flat dynamics may continue. On Thursday, investors await the publication of a report from the Confederation of British Industrialists on the dynamics of industrial orders for July. In addition, on this day, the representative of the Bank of England Jonathan Haskel will speak.

NZD/USD

NZD remains upward versus USD during today's Asian session. The instrument adds about 0.13% and is about to test the level of 0.6650 for a breakout. Some support for NZD is coming from the excitement in the market following the long-awaited approval of EUR 750 billion European economic recovery fund. In addition, the previous drivers remain in effect. USD is under noticeable pressure amid the deteriorating situation with the dynamics of the incidence of coronavirus in the United States. Also, the US authorities intend to obtain approval of a new package of economic stimuli; however, given the disagreements prevailing between the chambers of Congress, one cannot expect a quick solution. The macroeconomic statistics from New Zealand published yesterday exerted moderate pressure on NZD. New Zealand's Global Dairy Trade Price Index declined by 0.7% MoM after rising by 8.3% MoM last month. Analysts had expected growth of 3.9% MoM.

USD/JPY

USD is strengthening against JPY during today's Asian trading, correcting after a strong decline the day before. The "bearish" dynamics on Tuesday was facilitated by good statistics on consumer inflation in Japan, as well as the active growth of EUR on the market in response to the approval of the creation of the European economic recovery fund in the amount of EUR 750 billion. Today, American investors expect the publication of data on the dynamics of Existing Home Sales. After extremely disappointing May data, analysts expect strong sales growth (more than 20%) in June, which may provide significant support to USD. Markets in Japan are closed today due to a national holiday.

XAU/USD

Gold prices are showing strong growth during today's Asian session, once again updating multi-year highs. This time, the instrument managed to rise above the level of 1865.00; however, gold has not yet been able to consolidate at new highs. A weak USD supports the instrument. Investors expect new stimulus measures from the US government, and are also worried when analyzing the statistics on the incidence of coronavirus in the world. Some pressure on the instrument at the beginning of the week is exerted by the growth on stock exchanges, provoked by the approval of the idea of creating a fund for the recovery of the European economy in the amount of EUR 750 billion.

 

[MikhailLF]

EUR/USD: EUR maintains strong growth

Current trend

EUR is trading flat against USD today, consolidating after another “bullish” surge the day before, which led to the renewal of record highs since October 2018. EUR is supported by the fact that a European economic recovery fund worth EUR 750 billion has been approved. A breakthrough on this issue looks especially attractive against the backdrop of difficult negotiations on the introduction of new economic incentives in the USA. No one expected that Democrats and Republicans would be able to agree quickly, but the problem is that only a little more than a week remains until the end of the current plan to support the American economy.

Today European investors are focused on the speech of the Vice President of the ECB, Luis de Guindos, as well as the publication of the July data on the dynamics of the level of consumer confidence in the eurozone.

Support and resistance

Bollinger Bands in D1 chart show stable growth. The price range is expanding, but it fails to catch the development of “bullish” trend at the moment. MACD indicator is growing preserving a stable buy signal (located above the signal line). Stochastic, having approached its highs, reversed into the horizontal plane indicating overbought EUR in the ultra-short term.

Existing long positions should be kept in the short and/or ultra-short term until the signals from technical indicators clear up.

Resistance levels: 1.1600, 1.1657, 1.1700.

Support levels: 1.1546, 1.1500, 1.1460, 1.1422.

 

[MikhailLF]

Morning Market Review

EUR/USD

EUR is showing moderate growth against USD during today's Asian session, trading near record highs updated the day before. EUR ends the week with strong gains, boosted by the decision of European leaders to create a EUR 750 billion economic recovery fund. Meanwhile, USD remains under pressure amid growing statistics on the incidence of coronavirus, and also reacts negatively to difficulties in discussing a new aid package for the US economy in the Senate. Today, European investors are focused on business activity statistics from Markit in the euro area. It is expected that the main indicators will be able to consolidate above the psychological level of 50 points, which will additionally support EUR.

GBP/USD

GBP is trading against USD in both directions during today's Asian session, updating local highs since June 10. Further growth of the instrument is limited by uncertain macroeconomic statistics from the UK. In addition, GBP is under pressure from uncertain prospects regarding the conclusion of a trade agreement between the UK and the EU. At the same time, the weakness of USD allows the "bulls" to feel relatively free. The report on jobless claims released in the US yesterday again disappointed investors, strengthening the idea of the urgent need for a new stage of stimulating the American economy. Today, investors are focused on the statistics on Retail Sales in the UK for June. Also during the day, the data on the level of business activity in the manufacturing sector and the service sector from Markit for July will be released.

AUD/USD

AUD has shown slight growth against USD during this morning session, once again trying to consolidate above 0.7100. The instrument is supported moderately by the Australian business activity statistics from Commonwealth Bank. Services PMI rose sharply from 53 to 58.5 points in July, which was significantly better than market expectations of 53.2 points. Manufacturing PMI for the same period increased from 51.2 to 53.4 points, but did not reach the expected value of 53.6 points. Composite PMI in July rose from 52.7 to 57.9 points. After the American trading session opens, the attention of investors will shift to the data on business activity from the US, where analysts also expect optimistic results.

USD/JPY

USD is actively falling against JPY during today's Asian session. The instrument lost about 0.40%, testing the level of 106.40 for a breakdown. Investors are actively selling USD again after the publication of disappointing labor market statistics on Thursday. Initial Jobless Claims for the week ending July 17 increased from +1.307M to +1.416M, which was worse than market expectations of 1.300M. Meanwhile, Continuing Jobless Claims for the week ending July 10 slowed from +17.304M to +16.197M, while the forecast did not imply a decrease in the indicator below 17M.

XAU/USD

Gold prices are consolidating during today's trading, slightly retreating from record highs, once again updated the day before. The instrument is supported by a further increase in tensions between the United States and China, which threatens to cancel out all the success achieved by the countries earlier. In addition, the demand for gold remains high amid active discussions on new stimulus measures in the US economy. Yesterday's report on jobless claims dynamics in the US only strengthened the belief in the need for such measures, but investors fear that the political forces in the Senate will not be able to agree quickly.

 

[MikhailLF]

Morning Market Review

EUR/USD

EUR is actively rising against USD during today's Asian session, hitting record highs since September 2018. The instrument is gaining about 0.55% and is trying to consolidate above the next resistance at 1.1700. EUR is supported by strong macroeconomic statistics on business activity from the eurozone countries, published last Friday. German Manufacturing PMI in July rose from 45.2 to 50 points, which was better than expectations. Services PMI in Germany jumped from 47.3 to 56.7 points against the forecast of growth only to 50.5 points. Composite PMI rose from 47 to 55.5 points in July, also beating its forecasts of 50.3 points. In the euro area, the Composite PMI consolidated above the 50-point mark, indicating a gradual recovery in the European economy after the crisis. At the beginning of the week, the European investors are focused on the report on business climate in Germany from IFO. Also, German Bundesbank Monthly Report is expected during the day.

GBP/USD

GBP strengthens against USD during today's morning trading, updating its highs since March 11. "Bullish" activity for the instrument is facilitated by the weak positions of USD. In turn, GBP was supported by the upbeat macroeconomic statistics from Great Britain released last Friday. Retail Sales in June grew by 13.9% MoM after an increase of 12.3% MoM in the previous month. Analysts had expected a slowdown in the index to 8% MoM. Markit Manufacturing PMI in July rose from 50.1 to 53.6 points, exceeding market forecasts of 52 points. Markit Services PMI rose from 47.1 to 56.6 points, which also turned out to be better than expectations of 51.1 points.

AUD/USD

AUD is recovering against USD during this morning session, again approaching record highs of July 22. The growth of the instrument proceeds against the background of a large-scale decline in USD at the beginning of the new week, practically across the entire spectrum of the market. In turn, AUD is supported by a noticeable increase in demand for it as a carry-trading currency, as well as by good macroeconomic statistics on business activity for July published on Friday. Commonwealth Bank Services PMI rose from 53.1 to 58.5 points, beating market expectations at 53.2 points. A similar index in the manufacturing sector rose from 51.2 to 53.4 points, which fell slightly short of the expected values of 53.6 points. Today, investors are focused on macroeconomic statistics from the US on the dynamics of durable goods orders in June. Interesting data from Australia will appear only on Wednesday, when the quarterly statistics on consumer inflation is released.

USD/JPY

USD is steadily declining against JPY during today's Asian trading, continuing to develop a strong "bearish" momentum that formed at the end of the last trading week. The instrument loses about 0.50% and is trying to consolidate below 105.50. USD remains under pressure from weak macroeconomic statistics and growing fears about the high level of uncertainty in the market. Friday's US data reflected a rise in the Markit Services PMI in July from 47.9 to 49.6 points, while the forecast was for an increase to 51 points. Manufacturing PMI in July rose from 49.8 to 51.3 points, which also turned out to be worse than market expectations of 51.5 points. Today, investors are focused on macroeconomic statistics from the US on the dynamics of durable goods orders in June. Analysts do not expect strong data to emerge, so USD may come under pressure again.

XAU/USD

Gold prices are actively growing during today's Asian session, renewing their record highs. The psychological level of 1900.00 was reached at the end of last week, but on Monday the instrument demonstrates the most active dynamics over the past few months. Gold is still supported by a high level of market uncertainty. The alarming situation with the dynamics of the incidence of coronavirus in the United States does not allow USD to start correction, while the worsening geopolitical risks between the USA and China is becoming a new driver for the growth of the instrument.

 

[MikhailLF]

Morning Market Review

EUR/USD

EUR declines against USD during today's Asian session, retreating from record highs updated the day before. At the beginning of the week, the instrument showed the strongest growth in the past few months, taking advantage of the weakness of USD, which is in anxious anticipation of the results of the Fed's meeting, which will be held on July 28 and 29. In addition, investors fear the further spread of the coronavirus epidemic in the country, which could disrupt the government's plans for the pace of recovery of the national economy. In turn, yesterday's macroeconomic statistics from Germany supported EUR. German IFO Business Climate Index rose from 86.3 to 90.5 points in July, which turned out to be better than market expectations of 89.3 points. IFO Current Assessment for the same period rose from 81.3 to 84.5 points, while the forecast assumed an increase in the indicator to 85 points. IFO Expectations in July rose sharply from 91.6 to 97 points, exceeding forecasts of 93.7 points.

GBP/USD

GBP is correcting against USD during today's morning trading, retreating from the March highs, updated the day before. Technical factors contribute to the decline in the instrument, as USD remains strongly oversold. In addition, investors are fixing their profits ahead of the publication of the results of the Fed's meeting on Wednesday and the release of macroeconomic statistics from the US and Europe on Thursday. There will be not much UK data this week, so investors are likely to focus on US statistics. The focus will remain only on the negotiations between the UK and the EU. Earlier it was reported that the EU doubts the possibility of concluding a free trade agreement with the UK this year. London is somewhat more optimistic, but it is worth noting that the negotiation process is rather complicated.

NZD/USD

NZD declines against USD during today's Asian session, retreating from annual highs updated at the opening. The instrument loses about 0.40%, testing the level of 0.6650 for a breakdown. The emergence of corrective dynamics is facilitated by the growth of the oversold USD; however, fundamental factors are still playing against the American currency. Yesterday's macroeconomic statistics on Durable Goods Orders in the United States turned out to be quite good, but failed to provoke a noticeable rise in USD. The volume of orders in June slowed down from +15.1% to +7.3%, which came out close to the market forecasts at +7.2%. Nondefense Capital Goods Orders excluding Aircraft rose by 3.3% in June, after increasing by 1.6% last month. Investors expected an increase of 2.3%.

USD/JPY

USD is showing corrective growth against JPY during today's morning session, retreating from the local lows, updated at the beginning of the week. Technical factors contribute to the growth of USD, while investors are waiting for the publication of the results of the US Federal Reserve meeting on Wednesday. In addition, the US is to publish Q2 2020 annual GDP statistics on Thursday. The US economy is expected to show a record 34% YoY decline after contracting by 5% in Q1. The statistics from Japan published on Monday also contribute to the development of the uptrend for the instrument. Coincident Index in May fell from 80.1 to 73.4 points, which turned out to be worse than market expectations of 74.6 points. Leading Economic Index for the same period, on the contrary, rose from 77.7 to 78.4 points, but also turned out to be weaker than its forecasts of 79.3 points.

XAU/USD

Gold prices are showing ambiguous dynamics today, staying in the area of record highs, updated the day before. It should be noted that the instrument showed a sharp rise at the opening of today's session; however, the "bulls" retreated very quickly under the pressure of the correcting USD. The escalating conflict between the United States and China continues to provide strong support for gold. The parties continue to exchange mutual sanctions, which practically put an end to all previously reached trade agreements. In addition, the US economy remains in dire straits amid the raging COVID-19 epidemic in the country. This week, the US Federal Reserve will hold a meeting and important macroeconomic indicators for the US economy will be released as well.

 

[MikhailLF]

Morning Market Review

EUR/USD

EUR is again showing gains against USD during today's Asian session, returning to previous record highs, updated at the end of last week. Market activity remains moderate as investors are in no rush ahead of the publication of minutes from the US Federal Reserve's two-day meeting on Wednesday. Analysts do not expect any significant changes in the vector of monetary policy; however, the comments of officials are more important today than ever. There is a possibility that the Fed representatives will speak out on adjusting the target levels for inflation, given the alarming situation in the economy, as well as touch on the prospects for programs to support the economy, which are now being actively discussed in the Senate. Interesting statistics from Europe will appear only on Thursday, when Germany will report on the dynamics of GDP for Q2 2020, as well as publish the July statistics on unemployment and consumer inflation.

GBP/USD

GBP is showing ambiguous trading during today's morning session, close to the highs updated the day before. GBP retains a fairly confident "bullish" trend; however investors prefer to wait for the publication of the minutes of the Fed meeting. During the day, a block of macroeconomic statistics will be released in the UK, which, however, is unlikely to have a noticeable impact on the instrument's dynamics. One way or another, analysts expect the publication of the number of Mortgage Approvals in June (their number should increase by 33.9K). In addition, Consumer Credit data will be presented, as well as Net Lending to Individuals, which in May showed a decrease of 3.4B pounds.

AUD/USD

AUD has seen marginally gains against USD during today's Asian session, trading near record highs revised a week ago. Buying activity on the instrument is constrained by expectations of the publication of the minutes of the two-day Fed meeting, which, as analysts hope, will clarify the prospects for monetary policy in the near future. The macroeconomic statistics released in Australia today puts additional pressure on the instrument. Trimmed Mean CPI in Q2 2020 decreased by 0.1% QoQ after growing by 0.5% QoQ over the previous period. Analysts had expected an increase of 0.1% QoQ. At the same time, Consumer Price Index in Q2 2020 collapsed by 1.9% QoQ after rising by 0.3% QoQ earlier. Analysts expected a decrease of 2% QoQ.

USD/JPY

USD shows flat dynamics of trading during today's morning session, remaining near the local lows since mid-March, updated the day before. USD remains under significant pressure amid growing uncertainty associated with increased political risks, as well as the further spread of the COVID-19 epidemic in the country. Today, the activity of "bears" is somewhat reduced, which is associated with the expectation of the publication of the Fed meeting minutes. Analysts do not expect changes in the key interest rate, but they are eager to hear the comments of officials, since at present the country is clearly not coping with the number of economic challenges it faces. Interesting statistics from Japan will appear only on Thursday, when June data on the dynamics of Retail Sales and the volume of investments in the Japanese economy over the past few weeks are released.

XAU/USD

Gold prices are consolidating during today's Asian trading, retreating from record highs, updated the day before. The emergence of corrective dynamics from historical highs is associated with the expectation of the publication of the results of the US Federal Reserve meeting on Wednesday. In addition, technical factors also contribute to the development of the "bearish" trend, as the instrument has been actively increasing for eight trading sessions in a row. In turn, gold is still feeling significant support in the market. The increasing geopolitical risks, the unstable state of the American economy, as well as high uncertainty about the COVID-19 epidemic are pushing the asset to become a new reserve currency.

 

[MikhailLF]

XAU/USD: general review

Current trend

Gold prices are showing moderate gains again in trading in today's Asian session, recovering from the correctional decline the day before. On Thursday, the instrument retreated from its record highs and interrupted the historic rally to the level of 2000.00 amid technical factors and corrective sentiment on the US stock markets. In turn, with the opening of the American trading session on Thursday, the pressure on USD began to increase after the publication of disappointing statistics on the annual dynamics of US GDP for Q2 2020. Political risks also intensified after Donald Trump posted a proposal on his Twitter to postpone the presidential elections in the USA due to the difficult epidemiological situation in the country.

Support and resistance

Bollinger Bands in D1 chart show stable growth. The price range is widening from above, clearing the way for the "bulls" to new all-time highs and the target level of 2000.00. MACD indicator is growing preserving a weak buy signal (located above the signal line). For a long time now, Stochastic has been near its highs, trying to reverse into a downward plane. As before, the indicator points at the greatly overbought instrument in the ultra-short term.

It is necessary to wait for clarification of the situation in the market to open new positions. Some of the long positions should be kept for some time.

Resistance levels: 1980.84, 2000.00.

Support levels: 1955.00, 1935.00, 1910.00, 1895.06.

 

[MikhailLF]

Morning Market Review

EUR/USD

EUR shows flat dynamics of trading during today's Asian session, consolidating after the corrective decline in the instrument at the end of last week. On Friday, after updating record highs since May 2018, EUR fell sharply, which was mainly due to technical factors of taking long profits ahead of the weekend. Additional pressure on EUR positions was exerted by weak macroeconomic statistics on the dynamics of GDP in the euro zone for Q2 2020. In quarterly terms, GDP showed a 12.1% QoQ decline after a 3.6% QoQ contraction in the prior period. The indicator came out close to its forecasts at –12% QoQ. In annual terms, the decline in GDP in the euro area amounted to 15% YoY, which turned out to be slightly worse than analysts' expectations at the level of –14.5% YoY. In turn, data on consumer inflation in the euro area for July contributed to the strengthening of EUR. Consumer Price Index rose by 0.4% YoY, accelerating from the previous value of 0.3% YoY. Experts expected a slowdown to 0.2% YoY.

GBP/USD

GBP demonstrates moderate gains against USD again during today's morning session, returning to the local highs, updated at the end of last week. The instrument adds about 0.10% and is testing the level of 1.3100 for a breakout. The "bullish" activity for the instrument is supported by the weakness of USD, while the fundamental picture for GBP remains unchanged. Investors remain concerned about the uncertainty surrounding the conclusion of a trade agreement between the EU and the UK before the transition deadline at the end of the year. In addition, the UK is showing alarming statistics on the incidence of coronavirus, which puts plans to lift quarantine restrictions in the country into question. At the end of last week, Prime Minister Boris Johnson noted that further lifting of restrictions will inevitably lead to an increase of incidence. Today, investors expect the publication of statistics on business activity in the US and UK Manufacturing sector for July.

AUD/USD

AUD is marginally strengthening against USD during today's Asian session, recovering from a strong decline late last week as the instrument retreated from its record highs since February 2019. A certain support for AUD is provided by the macroeconomic statistics from Australia, published today. AiG Manufacturing index went up from 51.5 to 53.5 points in July. In the manufacturing sector, according to the Commonwealth Bank, activity rose from 53.4 to 54 points, better than the neutral forecasts. Inflation data from TD Securities in July showed an increase of 0.9% MoM and 1.3% YoY, which turned out to be significantly better than the data for the previous period: +0.6% MoM and +0.7% YoY. Chinese statistics also provided additional support to the instrument. Caixin Manufacturing PMI rose from 51.2 to 52.8 in July, beating market forecasts of 51.3.

USD/JPY

USD is showing ambiguous trading dynamics against JPY during today's Asian session, trying to develop corrective growth, the momentum for which was formed at the end of last week. Strengthening of USD positions is associated with technical factors, while there are still not many fundamental reasons for USD growth. Friday's statistics from the US again turned out to be heterogeneous, and the greatest support for USD was provided only by the Chicago PMI, which in July rose sharply from 36.6 to 51.9 points, which turned out to be better than expected by 43.9 points. JPY finds some support among macroeconomic publications from Japan. Jibun Bank Manufacturing PMI in July rose from 42.6 to 45.2 points with a neutral forecast. At the same time, the data also reflected the fall of the Japanese economy by 0.6% QoQ and 2.2% YoY in Q2 2020, which, however, did not come as a surprise.

XAU/USD

Gold prices are showing ambiguous dynamics during today's morning session, trading near record highs and a psychological level of 2000.00. The demand for the asset remains high against the background of continuing uncertainty in the market, as well as the progressive weakness of USD. The risks associated with the coronavirus pandemic are not going away and are likely to remain relevant until a resistant vaccine emerges and a widespread vaccination campaign begins. There are also geopolitical tensions on the market associated with the aggravation of relations between the United States and China. The parties continue to exchange mutual sanctions complicating the process of global economic recovery. Domestic political situation in the United States should be taken into account as well. In November, the US presidential election is to take place, which will have to be held in an environment of increased epidemiological risks.

 

[MikhailLF]

WTI Crude Oil: oil prices show flat dynamics

Current trend

WTI crude oil prices are trading flat after a moderate increase at the beginning of the week. The growth of quotations on Monday was caused by rather positive statistics on the corresponding sectors of the economy in Europe and Asia Pacific region. In turn, the further rising of the instrument was restrained by fears of an increase in the incidence of COVID-19, as well as growing supply of oil at the market. Since August, the volume of oil production cuts by OPEC+ members has been decreasing from the previously determined 9.7M barrels per day to the current 7.7M barrels.

Today, investors are focused on the publication of the API report on oil reserves for the week ending July 31. The previous report showed a sharp decline of 6.829M barrels.

Support and resistance

Bollinger Bands on the daily chart have been showing lateral trend for a long time. The price range almost does not change; however, it is quite consistent with the observed dynamics in the market. The MACD indicator is going down, maintaining a weak sell signal (located below the signal line). Stochastic, on the other hand, is showing moderate growth in response to the emergence of “bullish” trend on Monday.

To open new trading positions, one should wait until the signals from technical indicators are clarified.

Resistance levels: 41.00, 41.41, 42.00, 42.31.
Support levels: 40.00, 39.15, 38.47, 38.00.

 

[MikhailLF]

Brent Crude Oil: general review

Current trend

Oil prices are trading within a narrow range around $44 per barrel.

Quotes have been at the same levels for over a month, ignoring external events. They were not affected by the data on the next significant reduction in energy reserves from the API Institute. According to the report, the figure fell by –8.857M against an expected decrease of –3.300M. Today, EIA will provide its statistics, and its forecast is –3.001M.

In the main arbitrage position of the spread between Brent Crude Oil and WTI Crude Oil, the corridor has been a little more than $3 for a long time, which indicates a formed position. Its last change was observed in early June when quotes grew. It is not known when this position will be implemented but according to the Commodity Futures Trading Commission, the number of pure speculative positions on the asset began to fall, reaching 532.6K from 548.9K in the previous week. This is a fairly high rate of decline but not sufficient for asset price fluctuations.

Support and resistance

Quotes move within a narrow range of 5%. Alligator indicators’ EMA fluctuation range narrows and the fast EMAs crossed. AO oscillator’s histogram is above the zero line but has almost approached the transition level. Most of the markers indicate a possible beginning of a downward correction.

Resistance levels: 45.20, 51.60.
Support levels: 39.00, 31.20.

 

[MikhailLF]

XAG/USD: prices update record highs

Current trend

Silver prices are actively climbing during today's morning trading, updating record highs since April 2013 and trying to consolidate above the level of 27.00. A new rally for the instrument was due to the weak macroeconomic publications from ADP on employment in the US, which could lead to a slowdown in the recovery of the American economy.

In turn, some support for USD is provided by positive expectations regarding the formation of a new package of measures to support the US economy in Congress by the end of this week. A vote for the introduction of new stimulus measures may take place as early as next week. Another support factor for USD is noticeable improvement in the situation with the dynamics of the coronavirus incidence in the USA, as well as a number of promising forecasts for the development of a vaccine against COVID-19 in the near future.

Support and resistance

Bollinger Bands in D1 chart show stable growth. The price range is expanding; however, it fails to catch the development of "bullish" sentiments. MACD indicator is growing preserving a stable buy signal (located above the signal line). Stochastic retains steady upward direction, but is located near its highs, which indicates overbought instrument in the ultra-short term.

Existing long positions should be kept until technical indicators are clarified.
Resistance levels: 28.00, 28.70.

Support levels: 27.00, 26.17, 24.92, 24.00.

 

[MikhailLF]

XAU/USD: gold rises

Current trend

Gold quotes are actively growing, setting a new record around $2074 per ounce during yesterday's trading session.

The positive dynamics of the precious metals market attracts more and more new investors who continue to push quotes up. The explosive growth was catalyzed by the fall of the US dollar: traders began to convert assets into gold and oil, and the volumes were distributed in approximately equal shares. The weakening of the US currency has slowed down recently, while the growth of gold continues: investments in oil have not been profitable for more than a month, and investors began to look for a more promising shelter, thereby provoking a flow of cash liquidity into gold from oil.

The macroeconomic indicators of China, the main importer of gold, also speak of the panic nature of growth. The volume of imports of physical gold in July fell to –1.4%, therefore, the growth is formed by the purchase of exchange contracts, which will only grow.

Support and resistance

After reaching the global maximum at 2074.0, the price began to correct downward. Technical indicators keep a global buy signal. The range of fluctuations of the EMA indicator Alligator expands, and the histogram of the AO oscillator forms upward bars.

Resistance levels: 2075.0, 2100.0.
Support levels: 2040.0, 1945.0.