Due to dismal results from social-media companies and weak economic data, US stocks dropped on Friday, failing to maintain the upward momentum and ending a three-day rise. Snap Inc.’s disappointing performance and Twitter Inc.’s weaker-than-anticipated sales figure have heightened concerns about online ad spending, which is also one of the mounting indications that technology businesses are preparing for a recession.

The Fed meeting this week will be the primary focus for investors, as market sentiment remains fragile in the face of higher inflation, rapidly rising interest rates, and fears of a recession, despite market participants’ expectations that the Fed will take a more measured approach to tighten monetary policy. In the Eurozone, economic activity in Germany’s private sector decreased in early July, according to statistics released on Friday, while the eurozone’s manufacturing PMI went below 50 for the first time in more than two years. The economy of the eurozone is likely to fall in the third quarter, as corporate activity has begun to decline.

Both the S&P 500 and Dow Jones Industrial Average sank on Friday, with the S&P 500 falling for the first time in four days due to recession fears and disappointing tech company reports. The S&P 500 decreased by 0.9% on a daily basis, while the Dow Jones Industrial Average decreased by 0.4%. Eight of eleven sectors remained in negative territory, with the Communication Services and Information Technology sectors losing 4.34 % and 1.38 %, respectively, as the poorest performers. The Nasdaq 100 dropped the most on Friday, falling 1.8%, while the MSCI World index dropped 0.5%.

Main Pairs Movement

The US dollar was little changed on Friday, as it faced additional selling pressure and failed to rise above the 107.3 mark in response to data indicating a decline in early July private sector business activity. After the release of the German Manufacturing PMI, the DXY index inched upward and reached a daily high, but then began to experience fresh selling to extend its daily losses below the 106.2 mark. In July, the US S&P Services PMI fell to 47, which was well below the market’s forecast of 52.6 and indicated a worrying downturn in the economy.

The GBP/USD currency rate increased by 0.16 % on Friday after renewed dollar weakness. In terms of economic data, UK Retail Sales decreased by 5.8 % year-over-year in June, but better-than-expected UK PMIs have relieved some pressure on the Bank of England (BoE). At the start of the European session, the GBP/USD pair plummeted to a daily low below the 1.193 level before regaining upward momentum to recoup all of its daily losses. During the initial half of the day, EUR/USD was surrounded by bearish momentum and weighed down by dismal German PMI data. The pair declined by over 0.15 % for the day.

Gold climbed 0.55 % on the day after reaching a daily high above $1738 in the early US trading session, as the precious metal attracted new buyers in response to a strong decline in US government yields. Meanwhile, WTI oil maintained its downward momentum and fell to around $95 per barrel on Friday, as the reopening of the Nord Stream 1 gas pipeline weighed on oil prices.

Technical Analysis

XAUUSD(4-Hour Chart)

Gold surpasses $1,725 at the time of this Friday’s writing. As a result of the poor PMI data, the benchmark 10-year US Treasury bond yield falls by more than 4% every day, reducing the demand for the US dollar. After reaching the crucial support level of $1,680, gold performs a good technical recovery. Due to the fact that the RSI has not yet reached overbought territory and the MACD is continuing to provide support, gold may be able to overcome the $1,732 resistance level. The acceptance of the midpoint of the Bollinger band would protect the bulls of gold.

Resistance: 1732.58, 1756.40, 1779.70

Support: 1680.99

USDJPY (4-Hour Chart)

Following the release of US economic statistics, USDJPY was able to fall below 136,000 during the American session. The USDJPY reached its lowest level in two weeks. The intraday bias is now bearish from a technical standpoint, as the pair has breached the bullish channel. The pair is about to produce a four-hour closing price below the channel and the 136.28 resistance level. Immediate support is located at 135.67, followed by the zone at 134.52. To erase the negative tone, the U.S. dollar must climb back above 136.28.

Resistance: 136.28, 136.95, 137.53

Support: 135.67, 134.52

EURUSD (4-Hour Chart)

After US statistics, the EURUSD has extended its rebound during the American trading day. From a technical standpoint, EURUSD recovers after reaching the lower Bollinger Band band and the 20 Simple Moving Average. The bulls had pushed EURUSD over 1.0205 resistance at the time of writing, indicating a positive change on the four-hour chart. If EURUSD is able to sustain its upward momentum into the next barrier around 1.0284, the probable double-bottom formation will indicate a bullish bias for the pair. Currently, the RSI indicator is trading within the positive region, which supports the upside. Contrariwise, an intraday closing below 1.0205 could pave the way for a decline towards parity. Next week’s FOMC meeting will likely influence future price movements.

Resistance: 1.0284, 1.0362, 1.0459

Support: 1.0205, 1.0109

Economic Data

The European Central Bank agreed to increase interest rates by 50 basis points, the first increase in almost a decade, in response to increasing inflation and the ongoing conflict with Russia. In addition, Gazprom restored gas shipments to the EU via the Nord Stream 1 pipeline, giving extra support for EUR purchasers.

In the US, the business sector’s performance has bolstered market sentiment, contributing to Thursday’s rise in US stocks, which was the greatest three-day rally since May 2022. Apple Inc. and Amazon.com Inc. moved higher ahead of the release of their quarterly earnings reports next week, while Tesla Inc. soared 10% for the day after its quarterly results above expectations. Even if recent earnings optimism and anticipation that the Fed will take a more gradual approach to tighten monetary policy functioned as tailwinds for the equity markets, investor sentiment remains fragile due to worries about increasing inflation and the possibility of a recession.

The S&P 500 and Dow Jones Industrial Average both rose on Thursday, as the US currency dropped versus its peers and investors grew more bullish about the upcoming earnings season. The S&P 500 increased by 1% daily, while the Dow Jones Industrial Average increased by 0.5%. The Consumer Discretionary and Health Care sectors performed the best among all categories, advancing 2.25% and 1.51%, respectively. Nine of eleven sectors remained in positive territory. The Nasdaq 100 surged the highest on Thursday, increasing by 1.4%, while the MSCI World index jumped by 0.8%.

Main Pairs Movement

The US dollar dropped on Thursday, maintaining its bearish trend and failing to rise above the 107.3 level as the upward advance in the equities markets and poor US economic data imposed bearish pressure on the currency. After the ECB’s monetary decision, the DXY index inched higher and reached a daily high before fresh selling began to erase all of its intraday gains. The US Weekly Initial Jobless Claims increased to 251K in the week ending July 16, exceeding the market’s expectation of 240K by a significant margin. In July, the Philadelphia Fed Manufacturing Index fell to -12.3, which weighed on the U.S. dollar.

The GBP/USD exchange rate increased by 0.16% on Thursday as the US dollar weakened across the board. However, investor sentiment deteriorated due to reasons such as the ECB’s unexpected decision to increase interest rates by 50 basis points. At the opening of the US trading session, the GBP/USD pair plummeted to a daily low below the 1.190 level before regaining upward momentum to recover its daily losses. After the release of the ECB’s monetary policy decision, EUR/USD had considerable buying pressure and reached a daily high above the 1.027 mark. The pair increased over 0.50% on the day.

The decision by the European Central Bank (ECB) to raise interest rates by 50 basis points functioned as a tailwind for gold, which climbed 1.30% on the day after reaching a daily high above $1720 in the late US trading session. The restoration of gas flows from Russia’s Nord Stream 1 pipeline exerted significant downward pressure on WTI oil prices, which fell to the $96 level during the US trading session.

Technical Analysis:

XAUUSD(4-Hour Chart)

At the time of writing, gold is trading above $1,710 after recovering from a new 2022 bottom of $1,680.82. Following the announcement of the ECB’s monetary policy decision, the US dollar weakens, hence strengthening gold.

Technically speaking, gold indicates at a bullish correction as it has officially breached the bearish channel and the middle line of the Bollinger Band, indicating that bulls are initiating the upward momentum. Currently, the RSI indicator leans into positive territory on the four-hour chart, indicating that buyers have re-entered the market and sellers have exited. Gold is anticipated to rise towards the immediate resistance level of $1,727.58. If, on the other hand, gold is unable to keep its momentum above the negative channel, gains will be restricted and further selling pressure will ensue.

Resistance: 1727.58, 1756.40, 1779.70

Support: 1680.99

AUDUSD (4-Hour Chart)

After breaking the downward trend line in mid-July, the AUDUSD four-hour chart flips upside down. The four-hour chart reveals that AUDUSD closes above the 20 SMA but below the longer SMA, indicating that AUDUSD has not yet fully turned bullish over the longer term. The breach of the current resistance will propel AUD to the next level at 0.6982. Failure to overcome the current resistance level would result in a short-term AUD low of 0.6824.

Resistance: 0.6911, 0.6982, 0.7053

Support: 0.6824, 0.6682

EURUSD (4-Hour Chart)

Following a larger-than-anticipated increase in interest rates by the ECB, the EURUSD gains ground.

From a technical standpoint, the four-hour picture turns positive; the EURUSD continues to climb after hitting a low in mid-July. The pair advances alongside the upward trend line and the 20 Simple Moving Average. However, bulls of the EURUSD face rejection after hitting the upper Bollinger Band band and the overbought zone of the RSI indicator; sellers of the EURUSD look to take action, leaping in significantly to keep the dominating bearish in place. At the time of writing, EURUSD is clinging to the ascending trend line; bulls will continue to gain if EURUSD can hold above the level, then proceed to the next immediate resistance level at 1.0304. Alternatively, if EURUSD goes below the trend line, it will turn bearish in the short term, inviting additional follow-through selling.

Resistance: 1.0266, 1.0363, 1.046

Support: 1.0146, 0.9952

Economic Data

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US stock advanced on Wednesday, which is the first back-to-back gain in almost two weeks. Risk sentiment remains fragile, any upbeat surprises may lead to dramatic gains for markets amid investors’ expectations for potential disappointments. Tesla briefly jumped in extended trading after its earnings beat estimates. Besides the war in Ukraine, a slowdown in China and the prospect of the US recession, are all adding to investors’ skittishness. The European Union is preparing for a situation where Russia halts gas export to retaliate against sanctions over its invasion of Ukraine. It is worth noting that the rate decision made by the Bank of Japan and Bank of England this week. Overall, the market is still in fear of uncertainty, investors tend to wait for more information to plan their next moves.

The benchmarks, S&P 500 and Dow Jones Industrial Average both advanced for a second straight training session, as the US dollar remained under selling pressure. The S&P 500 increased 0.59% daily and Dow Jones Industrial Average was up 0.15% for the day, seven of eleven sectors get in positive territory as the Consumer Discretionary and Information Technology sectors performed the best among all groups, rising 1.77% and 1.56% respectively. Meanwhile, the Nasdaq 100 also rose 1.6% on Wednesday.

Main Pairs Movement

The US dollar advanced on Wednesday, ending its previous slide and rebounded toward the 107 area amid recession fears and a cautious market mood ahead of the European Central Bank monetary policy announcement. The DXY index was surrounded by bullish momentum during the first half of the day, then preserved its upside traction to touch a daily high above 107.2 level in the US session. The US dollar has benefitted from its haven status as investors are awaiting the outcome of the ECB meeting on Thursday, which is expected to hike the rate by 25 bps in July or even a potential 50 bps move.

GBP/USD declined with a 0.27% loss on Wednesday amid the stronger US dollar across the board. The worse-than-anticipated UK inflation data exerted bearish pressure on the cable as the UK Consumer Price Index (CPI) jumped to 9.4% yearly in June. The GBP/USD climbed to a daily high above the 1.203 mark in the Asian session, but then witnessed heavy selling to surrender all of its daily gains. Meanwhile, EUR/USD remained under downside momentum and dropped to a daily low below 1.016 level during the US trading session. The pair was down almost 0.50% for the day.

Gold tumbled with a 0.85% loss for the day after dropping to a daily low below the $1694 mark in the late US trading session, as the rising US bond yields and stronger greenback yesterday both weighed on the precious metal. Meanwhile, WTI oil failed to preserve its upside traction and dropped to the $99 area during the US session, as the recession fears escalated amid central banks’ rate hikes.

Technical Analysis

XAUUSD(4-Hour Chart)

Gold seems to consolidate along the descending channel on Wednesday. The outlook of the metal, gold, stays bearish as long as it trades within the bearish channel. On the upside, To regain upside traction, gold needs to at least climb above the descending channel onto the downside, the RSI indicator stays within the negative territory, suggesting that gold buyers are still on the sidelines. The breakout of the immediate support of 1697.66 would confirm another decline.

Resistance: 1,740.31, 1,766.70, 1,788.03

Support: 1,697.66

USDJPY (4-Hour Chart)

USDJPY rebounds after hitting the support level of 137.43. The intraday bias remains upside as it continues to trade within the strong bullish channel. At the time of writing, USDJPY is clinging to the upper bound of the bullish channel; a break of 138.18 will resume a larger up trend to its next resistance of 139.38. The break would be significantly important for USDJPY’s bulls as it is where the upper band of the channel and the 20 Simple Moving Average intersect. On the flip side, USDJPY’s bears need to decline below 136.22 to claim the downside momentum. Further price action eyes on the BOJ Press Conference and the FOMC meeting next week.

Resistance: 138.18, 139.38

Support: 137.43, 136.82, 136.22

EURUSD (4-Hour Chart)

EURUSD edges lower but steadily stays above 1.0200 after US data, Existing Home Sales fell sharply in June. Investors stay on the sidelines, waiting for the ECB meeting.

From the technical perspective, bulls of the EURUSD face rejections after hitting the resistance of 1.0266; however, the short-term outlook remains upside as the EURUSD still trades above the 20 SMA and within the upper band of the Bollinger band. The upside momentum holds as long as the RSI indicator does not fall towards the negative levels and the MACD does not become bearish. On the flip side, the decline will likely pick up the pace on a break below the support level of 1.0146.

Resistance: 1.0266, 1.0363, 1.046

Support: 1.0146, 0.9952

Economic Data

US stock rebounded on Tuesday, regained upside momentum and closed near session highs in its biggest one-day gain since June 24th as investors assessed the outlook for earnings. Any upside surprises may lead to impressive gains for equity markets amid investors’ expectations for potential disappointments ahead of the earnings report season. But the market focus remained on whether the aggressive monetary tightening by major central banks to fight high inflation will lead to a recession or not. In the Eurozone, the European Central Bank may consider a 50 bps rate hike during its meeting this week to deal with the worsening inflation, which lifted the Euro higher to its highest level in two weeks. On top of that, recession concerns have cooled a little bit as Russian gas giant Gazprom would resume its gas provision to the EU as planned on July 21.

The benchmarks, S&P 500 and Dow Jones Industrial Average both advanced on Tuesday as the US dollar remained under selling pressure and investors speculated that markets may have come close to their bottom. The S&P 500 was up 2.7% daily and the Dow Jones Industrial Average also advanced with a 2.4% gain for the day. All eleven sectors stayed in positive territory as the Communication Services and the Industrial sectors are the best performing among all groups, rising 3.63% and 3.58%, respectively. The Nasdaq 100 meanwhile climbed the most with a 3.1% gain on Tuesday and the MSCI World index rose 2% for the day.

Main Pairs Movement

The US dollar declined for the third session on Tuesday, as European Central Bank policymakers are considering raising interest rates by 50 basis points, which is higher than expected at their meeting on Thursday to calm record-high inflation. The DXY index bounced back to a psychological resistance of 107.500 in the first half of Tuesday, then lost upbeat momentum and dropped to a level below 106.500 during the Asia Session. The dollar lost 0.63% for the day and is still under selling pressure as the improvement in risk sentiment.

As the market got a positive mood, GBP/USD advanced by 0.35% on Tuesday. The declining inflation expectations in the US may hurt greenbacks further. The cable slipped to a daily low below 1.194 level, then regained upside traction and surged to a daily high above 1.202 level. Meanwhile, ECB President Christine Lagarde may elevate interest rates by 25 or 50 bps, which will trim the Fed-ECB policy divergence. EUR/USD witnessed heavy buying and reached a daily high above 1.024 during the mid-Asia session. The pair went up 0.83% for the day.

Gold advanced by 0.14% for the day, getting to a daily high above the $1713 mark in the mid-Asia session. A pullback in the US dollar continues to support the gold price as investors move to the sidelines ahead of key central bank meetings. Meanwhile, WTI oil preserved its upside traction and reached a daily high above the $100 level during the US session.

Technical Analysis:

XAUUSD(4-Hour Chart)

Gold advances slightly on Tuesday amid the broad-based selling pressure on the US dollar.

From the technical aspect, the outlook of the bullion remains bearish as gold continues to trade within the negative territory since early July. However, gold might be primed for a rebound if gold can breach the upper bound of the descending channel. The breakout of the level would give the metal a boost towards the next resistance of $1,740. On the flip side, if gold fails to overcome the bearish channel, the downside would resume towards the trough of $1,697.

Resistance: 1,740.31, 1,766.70, 1,788.03

Support: 1,697.66

USDJPY (4-Hour Chart)

USDJPY edges lower for the third- consecutive day on Tuesday amid subdued greenback demand. A diminishing odd for a more aggressive US Fed interest rate hike in late July continues to weigh on the greenback. From the technical perspective, the four-hour outlook of USDJPY remains bullish but bearish in the near term. Bulls are supported as USDJPY continues to trade within the ascending channel while USDJPY has dropped below the 20 Simple Moving Average, suggesting a downside momentum in the short- term. As of now, the relevant support near 137.43 would be the first defendant for bulls. A convincing break below the level might prompt aggressive selling and bring the pair to test 136.82. On the four-hour chart, as long as USDJPY holds above 136.22, the overall outlook remains upside.

Resistance: 138.18, 139.38

Support: 137.43, 136.82, 136.22

EURUSD (4-Hour Chart)

EURUSD continues to advance toward 1.0250 as the US dollar struggles to find demand. The euro-dollar gains positive traction amid the speculation about the ECB meeting this week. Technical speaking, in the near- term, the outlook of EURUSD turns upside as it trades well above the 20 Simple Moving Average. The break of the previous resistance has given the euro dollar a boost toward the next immediate resistance of 1.0266. Despite the RSI indicator has reached an extreme level, the bullish MACD looks to attract more follow-through buyers of the euro dollar. At the time of writing, bulls might give it another attempt if the pair can successfully break above the aforementioned resistance level of 1.0266. Further price action eyes on the ECB meeting.

Resistance: 1.0266, 1.0363, 1.046

Support: 1.0146, 0.9952

Economic Data

US stock declined on Monday, failing to preserve its bullish momentum after Apple Inc.’s plans to slow hiring added to the market’s concerns that the Federal Reserve’s aggressively monetary tightening against higher inflation will result in a recession. Wall Street was unable to retain its early gains and turned red despite the US encouraging data last Friday temporarily cooled recession-related concerns, as big companies like Apple Inc. and Alphabet Inc. both decided to slow hiring and spending growth next year in some divisions to respond to the potential recession. In the Eurozone, the energy crisis in Europe amid gas supply from Russia continued to weigh on investors’ moods as the Nord Stream 1 pipeline is scheduled to reopen on Thursday following its maintenance. The Russian company Gazprom has also declared to several European natural-gas buyers that it could not guarantee gas supplies to Europe because of extraordinary circumstances.

The benchmarks, S&P 500 and Dow Jones Industrial Average both dropped on Monday as Apple Inc. slid more than 2% on its worst day in almost three weeks amid a worsening mood. The S&P 500 was down 0.8% on a daily basis and the Dow Jones Industrial Average also declined with a 0.7% loss for the day. Eight out of eleven sectors stayed in negative territory as the health care and the utility sectors are the worst performing among all groups, rising 2.15% and 1.40%, respectively. The Nasdaq 100 meanwhile dropped the most with a 0.9% loss on Monday and the MSCI World index was little changed.

Main Pairs Movement

The US dollar kept declining to a weekly low at the beginning of the week, continuing to ease since the US encouraging data announced last Friday temporary cooled the recession-related concern. The DXY index still is in the mood bearish, and spent most of the first day of the week diving, to a weekly low of 106.9 during the late Asia session, but bounced back to 107.4 in the US afternoon.

GBP/USD advanced by 0.83% on Monday, as the improvement in risk sentiment. The cable moved up to a weekly high of 1.2020 during the late Asia session, then lost upbeat momentum and went back to around 1.1947. At the same time, EUR/USD also got a 0.63% growth on the first day of the week, to a weekly high of 1.0201, then fell back a little to around 1.0140 during the US afternoon. Not only the impact of the weak US dollar, but the high possibility of the ECB deciding to step up interest rates for the first time in 11 years make EUR/USD possibly regain bullish energy.

The Gold price remains almost unchanged on Monday. In the first half of Monday, the gold goes up to $1721, then lost momentum and fell to $1708 at the end of the day. Fed’s speak has pushed back against a 100bp hike from some notable hawks, raising the risk of a near-term short-squeeze on the Gold Price prior to the meeting. However, this could create the perfect storm for a downside continuation in gold on a hawkish outcome from the meeting.

Technical Analysis

GBPUSD(4-Hour Chart)

GBPUSD extends to a daily gain near 1.2000 in the American trading session as the US dollar confronts some selling pressure caused by the expectation of the Fed.

From the technical perspective, recently upside momentum has brought GBPUSD out of the negative territory where the bearish channel is; It suggests that the outlook of GBPUSD turns bullish on the four-hour chart in the near- term. At the moment, GBPUSD is clinging to the resistance level of 1.1958; the RSI indicator on the four-hour chart stays below 70, meaning that the pair has more room on the upside. If GBPUSD can stand sustainably above 1.1958, then the next resistance of 1.2081 would be the next target.

Resistance: 1.1958, 1.2081, 1.2180

Support: 1.176

XAUUSD (4-Hour Chart)

Gold trades slightly positive for the day despite a better market mood.

Technical speaking, the outlook of gold skews to the downside; gold’s bulls seem to be unable to overcome the midline of the Bollinger band, staying within the lower bounce. The RSI indicator remains in the negative territory, suggesting that buyers are still on the sideline. To the upside, in order to claim an upside momentum, gold needs to first climb above the midline of the Bollinger band, and then continue to climb toward the resistance level of $1,740.31. On the flip side, failure to stay above the support level of $1,697.66 would resume gold’s decline further south.

Resistance: 1740.31, 1766.70, 1788.03

Support: 1697.66

EURUSD (4-Hour Chart)

EURUSD advances as high as 1.0200 as the US dollar faces a selloff. The selloff of the US dollar comes after the Fed will hike interest rates by 75 bps, rather than the more aggressive option of 100 bps.

From the technical perspective, EURUSD shows an ongoing recovery from 0.9952 to 0.0174 on the four-hour chart at the time of writing. The double-bottom trading pattern has given the euro dollar a boost. The pair remains above the 20 Simple Moving Average and the upper band of the Bollinger Band, suggesting a bullish move in the near- term. At the moment, the resistance level of 1.0146 would be an obstacle for the pair to overcome as the RSI indicator has reached the overbought territory, suggesting a pullback. If the pair can successfully break the level, the recovery can extend towards 1.0266(38.2% of the Fib. Retracement.)

Resistance: 1.0146, 1.0266, 1.0363

Support: 1.0000, 0.9952

Economic Data

US stock surged on Friday, rebounding back and recovering some of the ground it lost at the end of a dizzying week as investors reduced their bets on a bigger rate hike by the Fed in July. Federal Reserve Governor Christopher Waller and St. Louis Fed President Jim Bullard, who are the two most hawkish FOMC members, said that they were not in favour of the bigger rate hike at the upcoming meeting in July. Therefore, markets are pricing in nearly 75 basis points of Fed tightening this month and down from a full-point bet earlier this week. However, the concerns about a potential recession remained as a 75 bps rate hike is still an aggressive boost for the economy. In the Eurozone, the ongoing fears over disruption to the euro-zone economy from energy supply constraints and fragmentation risks might keep weighing on investors’ sentiment, which is unlikely to ease in the coming weeks.

The benchmarks, S&P 500 and Nasdaq 100 both advanced on Friday as the less hawkish stance from Fed officials and positive US retail sales data both lend support to the market mood. The S&P 500 was up 1.9% daily and the Nasdaq 100 also advanced with a 1.8% gain for the day. All eleven sectors stayed in positive territory as the financials and the health care sectors are the best performing among all groups, rising 3.51% and 2.45%, respectively. The Dow Jones Industrial Average meanwhile climbed the most with a 2.1% gain on Friday and the MSCI World index rose 1.6%.

Main Pairs Movement

The US dollar declined on Friday, extending the previous day’s retracement slide from a two-decade high and edged lower on the last day of the week. The DXY index remained under bearish momentum during the first half of the day, dropping to a daily low below 108 level in the US trading session. Retail Sales in the US increased by 1% in June, which was better than the market’s expectation of a 0.8% rise but failed to lift the greenback higher.

GBP/USD advanced with a 0.38% gain on Friday amid the risk-on market mood across the board. However, the UK political uncertainty and Brexit woes might overshadow the prospects for a further tightening by the Bank of England and undermine the cable. The GBP/USD dropped to a daily low below 1.181 level, but regained upside traction and extended its daily gains. Meanwhile, EUR/USD witnessed heavy buying and refreshed its daily high above the 1.009 level to trim its weekly losses in the US session. The pair was up almost 0.72% for the day.

Gold declined with a 0.16% loss for the day after dropping to a daily low below the $1700 mark in the early US trading session, as the less hawkish stance from Fed officials continued weighing on the US dollar and offered some support to the dollar-denominated gold. Meanwhile, WTI oil preserved its upside traction and moved higher to the $98 area during the US session. But fears of a potential recession have raised concerns about the fuel demand outlook.

Technical Analysis

USDJPY (4-Hour Chart)

USDJPY consolidates the biggest daily gains in a month following the US Retail Sales and Michigan Consumer report. Technical speaking, USDJPY trades in the range of 138.18(76.4% of the Fib. Retracement) and 139.38(100% of the Fib. Retracement.) USDJPY witnesses some profit taking after contesting the resistance level of 139.38, the highest in 21 years. The corrective pullback erodes a part of the previous day’s strong gain. The intraday bias remains strongly bullish as the pair continues to trade above the ascending channel and above the 20 Simple Moving Average. On the downside, the breakout of the immediate support of 138.18 and the 20 Simple Moving Average would pressure USDJPY’s buyers, attracting some follow-through sellers. However, as long as USDJPY can trade above 136.22, the overall momentum remains upside.

Resistance: 139.38

Support: 137.88, 136.63, 135.77

XAUUSD (4-Hour Chart)

Gold steadies above $1,700 during the American session as falling US Treasury yields help limit further losses on gold. From the technical perspective, the intraday outlook of gold stays negative. Still, the psychological support of $1,700 seems to warrant some caution for bearish traders before positioning for any further drop. That being said, if the support fails to defend, then it is expected to see an accelerated decline in gold. On the contrary, gold needs to climb above $1,788 to declare its upside momentum on the four-hour chart. As the RSI indicator and the MACD remain hovering in the negative territory, the downward trajectory could further get extended.

Resistance: 1740.31, 1766.70, 1788.03

Support: 1697.66

EURUSD (4-Hour Chart)

EURUSD extends its rebound above 1.0050 during the American session on Friday. The euro-dollar eases some selling pressure as the bet on a 100 bps interest rate hike from the Fed declines. From the technical perspective, EURUSD is moving outside the descending regression on the four-hour chart. EURUSD looks to build some upside momentum following the trading pattern of double-bottom. At the time of writing, EURUSD is expected to contest the resistance of 1.0146. In the meantime, the RSI indicator on the four-hour chart has surpassed the midline, suggesting that buyers are gradually back in the game.

Resistance: 1.0146, 1.0266, 1.0363

Support: 1.0000, 0.9952

Economic Data

US stock continued to stay in negative territory but closed above session lows as Federal Reserve officials’ comments have eased investors’ concerns about a recession caused by the aggressive pace of monetary tightening. Federal Reserve Governor Christopher Waller said that markets may have gotten ahead of themselves by pricing a 100 basis points rate hike in July, adding that they would back a 75 bps rate hike after a hot inflation report. Therefore, traders shifted their bets away from a 100 bps rate hike by the Fed this month, but people are now confused that where the economy is heading and whether we are going into recession. In the Eurozone, the Russian energy giant Gazprom said that it would not guarantee to resume the functioning of the Nord Stream 1 pipeline after it was shut down for repairs. The uncertainty around gas deliveries is weighing on Europe’s economic outlook.

The benchmarks, S&P 500 and Nasdaq 100 both dropped on Thursday as the equity market stayed under pressure amid high inflation and fears of a global recession. The S&P 500 was down 0.3% daily and the Nasdaq 100 also declined with a 0.3% loss for the day. Eight out of eleven sectors stayed in negative territory as the financials and the energy sectors are the worst performings among all groups, losing 1.92% and 1.90%, respectively. The Dow Jones Industrial Average meanwhile declined the most with a 0.5% loss on Thursday and the MSCI World index fell 0.8%.

Main Pairs Movement

The US dollar edged higher on Thursday, continuing to derive support from the fears of a recession and refreshing its 20-year high above 109 level. The DXY index was surrounded by bullish momentum during the first half of the day but then retreated to erase some of its daily gains in the US trading session. The comments from Fed officials yesterday have cooled down expectations of a 100 bps rate hike in the US and triggered a corrective slide witnessed in the US dollar.

GBP/USD declined with a 0.57% loss on Thursday amid the risk-off market mood across the board. Political news in the United Kingdom has exerted some bearish pressure on the cable, as UK Prime Minister announced his resignation and Tories began an election process. The GBP/USD remained under bearish momentum and dropped to a daily low below the 1.177 mark, then rebounded slightly back to recover its daily losses. Meanwhile, EUR/USD preserved its downside traction and plunged to 0.9951 before recovering some ground and trimming its earlier losses in the US session. The pair was down almost 0.45% for the day.

Gold tumbled with a 1.48% loss for the day after dropping to a daily low below the $1700 mark in the early US trading session, as the rising US dollar and hawkish sentiment surrounding the Fed continued to drag the precious metal lower. Meanwhile, WTI oil regained upside traction and climbed back to the $96 area during the second half of the day.

Technical Analysis

USDJPY (4-Hour Chart)

USDJPY reaches as high as the 139.00 mark, the highest level in 23 years. The currency pair is tracking the renewed upsurge as the expectation of a 100 basis points Fed interest rate hike later this month.

From the technical perspective, the intraday bias of USDJPY turns sharply upside and bullish as the pair has successfully breached the bullish channel and its psychological resistance of 137.00. The immediate resistance of 139.89 would be the next major level to challenge; the level would be a major obstacle as the RSI indicator has turned way over overbought territory, suggesting that the bid tone might happen soon. The outlook of USDJPY remains bullish on the four-hour chart as long as it trades above 135.77.

Resistance: 139.38

Support: 137.88, 136.63, 135.77

XAUUSD (4-Hour Chart)

Gold slumped as low as $1,697 during the American trading session amid the high demand for the greenback; gold later rebounds above $1,700, but is still down more than 1% despite dovish Fed commentary.

Technical speaking, the intraday outlook of XAUUSD remains bearish as gold continues to trade within the descending channel. At the moment, the pivotal support level of $1,697 would be a major defendant for the bright metal; the breakout of the level would scale gold southwards. Moreover, the RSI indicator has returned to the bearish range of 20 to 40 readings, indicating a fresh leg of the bearish impulsive wave ahead.

Resistance: 1740.31, 1766.70, 1788.03

Support: 1697.66

EURUSD (4-Hour Chart)

EURUSD again contested its support level below the 1.0000 mark during the European session. But later recovers from multi-decade lows following the dovish comments from the Fed in the American session.

From the technical aspect, EURUSD remains under negative pressure despite its positive attempts. The trading pattern of a fresh lower leg hint that EURUSD continues to skew southwards. To reclaim the upside, EURUSD needs to climb above 1.0569, a positive territory. At the moment, the upside is supported by the MACD indicator as it has turned positive. On the contrary, the RSI indicator hovers around 30-40 readings, suggesting that the pair still attracts some sellers.

Resistance: 1.0243, 1.0423, 1.0569

Support: 1.0000, 0.9952

Economic Data

Dear Client,

Warmly reminds you that the component stocks in the stock index spot generate dividends. When dividends are distributed, VT Markets will make dividends and deductions for the clients who hold the trading products after the close of the day before the ex-dividend date.

Indices dividends will not be paid/charged as an inclusion along with the swap component. It will be executed separately through a balance statement directly to your trading account, the comment for which will be in the following format “Div & Product Name & Net Volume ”.

Please note the specific adjustments as follows:

The above data is for reference only, please refer to the MT4/MT5 software for specific data.

If you’d like more information, please don’t hesitate to contact [email protected].

Dear Client,

To provide our clients with a wealth of trading options, VT Markets will optimize the stock products on Jul 18th, 2022:

Type: Stocks (US, UK, EU)
Content:
1. Added 683 stock products to the MT5 server.
2. GOOG (US) stock split.

• The specifications of the new products are shown in the table below.

The above data is for reference only, please refer to the MT5 software for specific data.

Friendly reminders:
1. The new Shares are only available for trading on MT5.
2. Please refer to the specification on MT5 for other details.
3. 1 GBP = 100 GBX

※ GOOG (US stock) stock split details are as follows:

Please be advised of the upcoming ALPHABET INC-CL C (GOOG) stock split that is going to take place as per the following schedule:

Ex-Date: July 18th, 2022. Common shares will trade at the new split-adjusted price.

Important implications of the ALPHABET INC-CL C Stock Split:

1. The quantity of shares of each client’s position will multiply by 20.

2. Post-split, the “open price” and “take profit/stop loss” of each position will be adjusted, which will be the original price divided by 20.

3. The estimated post-split price may be 20/10 of the EOD price on 15th, July.

4. All pending orders at the time of the split (Buy Limit, Sell Limit, Buy Stop, Sell Stop, Buy Stop Limit, Sell Stop Limit) will be cancelled.

5. All ALPHABET INC-CL holding positions and pending orders on DEMO account will be closed as a result of the stock split.

Q. What is a stock split?
A. A stock split is a corporate action taken by companies that have seen their share price increase to levels that are either too high or are beyond the price levels of similar companies in their sector, to divide their existing shares into two or more shares.

Q. Why do stocks split?
A. The primary motive is to make the shares more affordable to small investors even though the underlying value of the company has not changed. ALPHABET would like its stock to be more accessible to a broader base of investors.

Q. What is the split ratio?
A. ALPHABET also announced it will split its stock in a 20 for 1 offering.

Q. What will this split mean to investors?
A. Each share of GOOG stock that an investor owns before Ex-Date (July 18th, 2022) will be eligible for stock split. Investors will receive nineteen additional shares and the stock price will be 1/20.

Here is an example:
If an investor owns 100 shares and the market price is $2,000, $2,100 as take profit. After 20 for 1 stock split, the investor will own 100*20= 2,000 shares and the estimated post-split price would be $2,00/20 = $100, and the take profit price will adjust to $2,100/20=$105.

Q. Does the 20 for 1 stock split mean the value of my GOOG shares will increase nineteen times?
A. Unfortunately, not. As stated in the above example, the increase in the number of stocks means every share is now worth less than its previous value, precisely, it’ll be 1/20th the previous value.

Q. How do stock splits affect short sellers?
A. Stock splits do not affect short sellers in a material way. There are some changes that occur as a result of a split that affects the short position, but they don’t affect the value of the short position(s).

The above data is for reference only, please refer to the MT4/MT5 software for specific data.

If you’d like more information, please don’t hesitate to contact [email protected]