Daily Market Analysis

Market Focus

The three major indexes traded mixed Tuesday afternoon after gaining earlier in the day, with traders looking for fresh catalysts to rally beyond current record levels. The information technology and consumer discretionary sectors outperformed in the S&P 500. The tech-led session kept the Nasdaq in slightly positive territory (+0.19%). Dow Jones was little changed (+0.03%) as more than 1% drops in shares of Intel, Disney and Boeing offset gains in other components including Nike, Home Depot and Apple.

A divided U.S. Supreme Court refused to lift the federal moratorium on evictions during the Covid-19 outbreak, leaving the ban in place until the end of July.

Voting 5-4, the justices rejected calls by landlords and real-estate trade associations from Alabama and Georgia to block the moratorium while their challenge goes forward. They contend the Centers for Disease Control and Prevention exceeded its authority by imposing the spread of the coronavirus.

Chief Justice John Roberts and Justice Brett Kavanaugh joined the court’s three liberals in the majority. Kavanaugh said he was doing so because the moratorium is set to expire on July 31.

The ban applies to tenants who, if evicted, would have “no other available housing options.” The CDC and President Joe Biden’s administration say the moratorium is geared toward protecting tenants who would be forced to live in close quarters elsewhere or become homeless and dependent on shelters.

Main Pairs Movement:

The greenback appreciated against most major rivals as the dollar index reached a five-day high above 92.00, especially against high-yielding currencies. There was no obvious catalyst for the gains as the greenback actually retreated in the final trading session of the day, despite better than anticipated US data.

The euro pair hovered below 1.1900, awaiting the upcoming inflation figures; cable settled around 1.3840, undermined by Brexit jitters related to the Northern Ireland Protocol. Aussie fell toward the 0.7500 level, while the loonie pair flirts with 1.2400. The American currency strength and the modest performance of Wall Street weighed on commodity-linked currencies.

Gold plummeted to a fresh two-month low of $1,750.60 a troy ounce, bouncing ahead of the close to $1,761. Crude oil prices were mixed, as WTI surged around 1%, settling at $73.40 a barrel, and Brent almost declined for another day, closing with a tiny gain at $74.63.

“Unemployment rate would have to drop fairly substantially, or inflation would have to stay high, to have a 2022 rate hike,” Fed Governor Christopher Waller said on Tuesday’s Bloomberg TV Interview. “If you think you may need to raise rates by end-2022 or early 2023, you need to get tapering done before then.”

Though Fed’s Waller add to the market’s anxiety over inflation and rate-hike, major pairs still trade at familiar levels, seemingly unaffected by the press time. The reason could be traced from the cautious sentiment ahead of the day’s key data, namely China PMI and US ADP Employment Change.

Technical Analysis:

USDJPY (4- Hour Chart)

USDJPY loses its traction around 110.5 level during the American session. Even though the pair still trades within the overall ascending trend, it stages a technical correction. Similar to the previous day, USDJPY remains neutral for its intraday bias. Further rally will resume with its resistance of 111.12 intact. On the downside, break of 110.51 will turn the pair’s bias back to the downside for 110.14, turning the pair to bearish as it will breach the ascending trend line. From the technical indicator’s view of point, the pair is bearish in the near- term as the MACD is turning down, lending supports to bears; the RSI is neutral, lacking directional strength as of now.

Resistance: 111.12

Support: 110.51, 110.14, 109.84

EURUSD (4- Hour Chart)

EURUSD remains pressured under 1.1900 level as the greenback gains strength. From the technical aspect, EURUSD is poised to extend its decline, heading toward its support of 1.1837. On the 4- hour chart, the outlook of the pair is bearish as it trades below the 20 simple moving average as well as the 50 SMA, stating that the pair is under pressured. At the same time, the downside pressure is also supported by the negative MACD. If the pair falls below the previous low on the 22^nd of June, then it will accelerate its slide within negative level, favoring a chanllege against 1.1837.

Resistance: 1.1919, 1.1985, 1.2052

Support: 1.1837, 1.1704

GBPUSD (4- Hour Chart)

GBPUSD slips below 1.3850, reaching the weekly low as the greenback gains ground across the board. On the 4- hour chart, GBPUSD remains bearish as it has been unable to recapture the 20 and the 50 SMAs, experiencing the downside momentum. Additionally, the RSI is currently above the 30 readings, thus far from oversold conditions, allowing the pair for more declines; the MACD sustains its negative mode, lending supports to bears. As the time of writing, GBPUSD is expected to extend its fall toward its next support of 1.3787 in the near- term.

Resistance: 1.3896, 1.3963, 1.4017, 1.4072

Support: 1.3787

Economic Data

Daily Market Analysis

Market Focus

Wall Street benchmarks refreshed all-time highs with mild gains, except for Dow Jones Industrial Average (DJI), on Monday. Nasdaq surged 1.20%, while DJI closed red (-0.53%). The equities offered a mixed beginning to the key week comprising the US Nonfarm Payrolls (NFP) amid a light calendar. The Federal court’s dismissal of the Federal Trade Commissions’ (FTC) antitrust lawsuit against Facebook boosted FB by 4.0%, also propelled shares of Microsoft, Amazon, Apple, and other tech giants.

The House passed two bills Monday that are expected to form the core of legislation in the chamber designed to boost U.S. research and development in response to China’s challenge to U.S. economic supremacy.

By wide bipartisan margins, the House authorized more funding for the National Science Foundation and additional money for the Department of Energy, following a similar effort in the Senate that saw the passage of a comprehensive $250 billion measure that included more than $52 billion in incentives and grants for domestic semiconductor manufacturing.

While the Senate pulled separate pieces of legislation into a single bill intended to bolster U.S. competitiveness with China, the House is taking a more piecemeal approach. Some lawmakers and industry groups are pressing for the House to include the incentives for chipmakers in whatever package eventually emerges.

“As the legislation advances, we urge Congress to include $52 billion to fund the critical semiconductor research, design, and manufacturing initiatives” included in previous congressional legislation that was never funded, the Semiconductor Industry Association said in a statement.

Main Pairs Movement:

Major pairs remained restrained to narrow price ranges. Dollar managed to post a modest intraday gain, helped by optimistic market sentiments.

The euro pair fell to 1.1902, its lowest in 5 days, but finished the day in the 1.1920 area. ECB’s Robert Holzmann said there is no room to increase rates given weak inflation, adding that the PEPP will end when the coronavirus emergency is over, something that won’t happen anytime soon. The facilities program will be revised in September.

Cable failed to recover the 1.3900 mark and trades around 1.3875. After Matt Hancock resigned over the weekend, Sajid Javid is the new UK’s health minister. Javid affirmed that coronavirus-related restrictions would be lifted on July 19, as the government sees “no reason to go beyond” that date. Meanwhile, the UK reported 22,868 new coronavirus cases, the largest one-day increase in five months, amid the spread of the Delta variant.

Antipodean currencies lost some ground against their American rival. Aussie ended the day at 0.7565, and Kiwi at 0.7040. The loonie pair trades at 1.2335, slightly higher than the previous day. Gold continued consolidating around $1,780, but crude oil prices edged lower. WTI settled at $72.75 a barrel, and Brent at $74.58. US 10-year Treasury yields advanced during European trading hours, but retreated ahead of Wall Street’s opening, to end the day below 1.500.

Technical Analysis:

USDJPY (4- Hour Chart)

Despite of today’s retreat, USDJPY remains its bullish momentum as it keeps trading within the ascending channel and trading above a bullish 20 simple moving average in a bigger outlook. Nonetheless, USDJPY seems to lose its direction on the 4- hour chart as the pair is unable to sustain gains beyond its immediate resistance of 111.12; at the same time, both technical indicators, the MACD and the RSI, lose their directional strength around the midlines. To the downside, if the pair loses traction below the support of 110.51, then its intraday bias will become bearish in the near- term; on the other hand, if the pair regains its bulls above 111.12, then it will continue to be bullish and extend further north.

Resistance: 111.12

Support: 110.51, 109.14, 109.84

EURUSD (4- Hour Chart)

EURUSD continues to consolidate in the tight range above 1.1900 level. On the 4- hour chart, the pair remains neutral at this point since it continues to cling around 1.1985 level. On the upside, a break of 1.1919 will lead the pair head to 1.1985 instead; to the downside, if the pair fails to hold above 1.1919, then it might aim for the weekly low at 1.1837. However, similar to GBPUSD, the pair seems to be in a neutral position as the MACD and the RSI are both in a neutral status. As a result, the focus will shift to Tuesday’s mid- tier US economic data releases.

Resistance: 1.1985, 1.2052

Support: 1.1919, 1.1837

GBPUSD (4- Hour Chart)

GBPUSD retreated below 1.1900 level as the resurgent demand for the US dollar and the coronavirus delta variant tension in the UK. The outlook of GBPUSD remains under pressured on the 4- hour chart. The pair is currently contesting its minor support level of 1.3896; to the downside, a break of the level will resume the fall to chanllege the next level of 1.3787. On the upside, if the support level of 1.3896 is held, then the pair will turn bias back to upside for the level of 1.3963 instead. As the time of writing, the intraday bais remains neutral first as the MACD is overlapped and the RSI remains neutral

Resistance: 1.3963, 1.4017, 1.4072

Support: 1.3896, 1.3787

Economic Data

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Daily Market Analysis

Market Focus

The S&P 500 index rose to another record last Friday, after investors pored over fresh U.S. economic data a day after an infrastructure spending agreement in Washington helped lift the broad market to all-time highs. The Dow also finished higher (+0.69%), with the rise in Nike shares being a big driver of its gains. JPMorgan Chase & Co. also added to the benchmark’s performance, after the results of the Federal Reserve’s latest stress tests, released last Thursday, showed banks have enough capital to withstand a severe global recession and so can resume paying dividends and buying back stock. Nasdaq closed red (-0.06%).

The U.S. president Joe Biden and a bipartisan group of senators presented the agreement on new infrastructure spending on Thursday. Biden suggested after the deal was stuck that his signature on any infrastructure bill was contingent on Congress also passing the much larger tax and social-spending measure that Democrats are preparing.

On Saturday, he issued a statement saying it “was certainly not my intent” to create the impression he was threatening to veto “the very plan I had just agreed to.”

Mitt Romney, also among a group of GOP senators who announced the infrastructure deal with Biden at the White House on Thursday, said he was concerned about the president’s earlier comments but thinks “the waters have been calmed by what he said on Saturday.”

“I do trust the president,” Romney, a Utah Republican, said on CNN’s “State of the Union” on Sunday. “At the same time I recognize that he and his Democratic colleagues want more than that.”

Senator Bill Cassidy, a Louisiana Republican who’s in the bipartisan group, said “I’ll continue to work for the bill.” Asked whether on NBC’s “Meet the Press” whether he expects Senate Minority Leader Mitch McConnell to try to sink the bipartisan plan, he said: “If we can pull this off, I think Mitch will favor it.”

Main Pairs Movement:

Though higher US PCE inflation, which rose in May 3.4% YoY, its highest reading in almost three decades, greenback’s performance is still weak as the stats didn’t surprise the market players. The dollar ended the week with modest losses. However, U.S 10-year Treasury Bonds yield soared 2.38% to 1.531, benefiting from the price index’s rise.

The euro pair kept lingering within familiar levels, ending the week at around 1.1930. Cable settled at 1.3870, as the pound remained under selling pressure, undermined by the BoE’s dovish announcement. The antipodean currencies modestly advanced against their American rival at the weekly close, while the loonie pair ended red.

Gold finished the week little changed around $1,780 per ounce. Crude oil prices advanced, with WTI up to $74.00 a barrel, and Brent to $76.00.

UK Health Minister Mark Hancock resigned on Saturday after breaking coronavirus-related rules imposed by himself. The news may impact the already weak Sterling at the weekly opening.

The week will start in slow motion from the fundamental side, with the focus on US employment numbers to be out by the end of the week.

Technical Analysis:

USDJPY (4- Hour Chart)

USDJPY edges higher after the US PCE inflation data during the American session. The pair remains bullish mode as it conitnues to fall within the ascending channel, signaling the positive move. The stability of the USDJPY above the 110 psychological level continue to support the upside momentum. At the same time, the technical indicator, the MACD remains bearish while the RSI is still outside of the overbought territory on the 4- hour chart, giving the pair rooms to extend further north. It is expected to the pair moves toward the next resistance of 111.12.

Resistance: 111.12

Support: 110.51, 109.14, 109.84

EURUSD (4- Hour Chart)

EURUSD bounces back during the American session after tounching weekly highs at 1.1976, caused by higher US yields, giving the greenback a boost. On the technical sphere, the pair still trades in levels close to the oversold condition, which means that its bullish attempt might cling on the resistance of 1.1985 for a moment before next week, a busy US calender week. To the upside, EURUSD still remains bullish as the MACD is positive, and the pair trades above the 20 SMA on the 4- hour chart. If the pair ends up breaching its current resistance and the 50 Simple Moving Average, then it will head toward the next psychological level at 1.2000.

Resistance: 1.1985, 1.2052

Support: 1.1919, 1.1837

GBPUSD (4- Hour Chart)

GBPUSD continues to remain under pressured by the dovish BOE’s decision. The pair reverses from bullish to bearish this week, moving away from the key 1.4000 resistance region and now heading toward its next immediate support of 1.3896. GBPUSD remains bearish as the MACD has turned negative, lending supports to bears; at the same time, the downside pressure is expected to continue as the RSI is outside of the oversold terriotry, giving the pair rooms to extend further south. To the upside, the pair needs to trade above the critical hurdles at the 20 SMA and the 50 SMA in order to stand back to the positive trend.

Resistance: 1.3963, 1.4017, 1.4072

Support: 1.3896, 1.3787

Economic Data

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Daily Market Analysis

Market Focus

Stocks climbed to an all-time high as President Joe Biden’s bipartisan $579 billion infrastructure deal added to optimism the economic recovery is taking hold. Nasdaq 100 rose 0.6%. Dow Jones rose 1%. Companies that stand to benefit the most from a rebound in activity outperformed — with financial and energy shares leading gains in the S&P 500. Caterpillar Inc. (+2.6%), the world’s biggest maker of mining and construction equipment, jumped alongside raw-material producers such as U.S. Steel Corp. (+3.36%) and Nucor Corp. (+1.99%).

Wall Street banks are poised to announce a deluge of dividend increases and stock buybacks after Fed’s stress tests showed the industry built up a stockpile of cash during the pandemic.

Lenders can announce their plans for distributing capital after the market closes on June 28, and the industry’s strong results mean payouts may be the largest ever following the Fed’s annual exams. Early estimates indicate the six biggest U.S. banks, including JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc., could return more than $140 billion to shareholders.

The passing marks, announced Thursday by the Fed, indicate that firms are officially free from restrictions that the regulators put on dividend payments and share repurchases last year when Covid-19 was ravaging the economy. The banks’ solid performance also signals that the industry has grown much more comfortable with the exercises, which used to trigger anxiety and frustration across Wall Street.

However, as the news suggests the Fed’s indirect recalling of the pandemic-led relief measures, investors do worry for the monetary policy adjustments and the same weigh on the risk appetite.

Main Pairs Movement:

Similar to the previous day, the greenback lost some ground throughout the first half of the day, to recover most of it during the American session. Trading was dull as released economic data were mixed. The euro pair hovered around familiar levels above the 1.1900 level, while antipodean currencies consolidated against their American rival. Loonie closed at 1.2320, slightly higher than yesterday.

US data was somewhat encouraging, although most of the figures missed the market’s expectations. Weekly Initial Jobless Claims printed at 411K, while the previous weekly figure was revised to 418K. Durable Goods Orders were up 2.3% in May, while the Q1 GDP was confirmed at 6.4%. The numbers indicate that the US economic recovery may have reached a plateau. It is not bad news but may prevent the greenback from strengthening further.

Sterling was the worst among the major currencies, falling after the BoE’s monetary policy announcement. As widely anticipated, policymakers remained rates and easing programs unchanged. However, the following statement offered a dovish tone. “The Committee does not intend to tighten monetary policy at least until there is clear evidence that significant progress is made in eliminating spare capacity and achieving the 2% inflation target sustainably.” Apparently, clichés were not satisfying. Speculators were looking for a more hawkish tilt. Cable trades around 1.3910.

Gold faced headwinds during the US afternoon, as stocks reached record high. The rally in equities was backed by US President Joe Biden’s announcement, as he said that they reached a bipartisan deal on the infrastructure spending plan. The yellow metal settled at around $1,775.00 per ounce.

Crude oil prices bounced from intraday lows, posting modest daily gains. WTI settled at $73.30 a barrel, while Brent stands firmly above $75.00, trading at $75.54 as of writing.

Cryptos are on the way to recover its huge loss on Monday. Bitcoins traded higher in a third consecutive day, attacking the $35,000 resistance; Ethereum alike tried to break though the $2,000 level, trading at $1,990 at the moment.

Technical Analysis:

USDJPY (4- Hour Chart)

USDJPY erodes overnight gains from the highest level during the American session as the mixed signals on the US inflation concerns keep the greenback bulls on the defensive. From the technical perspective, after contesting the resistance level of 111.12, USDJPY struggles to find acceptance above the level, resulting in a pullback afterward. However, the pair remains its offered tone since it continues to trade within the ascending channel, signaling that the bullish momentum has not ended yet; the pullback might be a signal to adjust its overbought readings as the RSI was around 70 when the pair hit 111.12 on the 4- hour chart. At the same time, sustainly advancing above its simple moving averages also supports USDJPY’s bullish traction.

Resistance: 111.12

Support: 110.51, 109.14, 109.84

EURUSD (4- Hour Chart)

EURUSD enters consolidative phase as both currencies are without clear directional strength. On the 4- hour chart, the pair shows that it keeps finding the support level of 1.1919 while trading in between the upper bounce and the midline of the bollinger band, showing that the pair is poised to extend its bullish momentum in the near- term. The short- term bulls are supported by the MACD, as the MACD line is above the signal line. To the upside, if the pair successfully breaches this consolidative phase around 1.1919 region, then it will head toward the next resistance of 1.1985 to 1.2000, where the psychological level is. Technical indicators aim higher after consolidating around their midlines, which reflect the greenback’s limitation.

Resistance: 1.1985, 1.2052

Support: 1.1919, 1.1837

GBPUSD (4- Hour Chart)

The British pound weakens against the greenback on diappointing BOE as BOE decides to maintain the monetary policy on hold, not intending to tighten the monetary policy. From the technical perspective, after the strong move this week, GBPUSD slides as the double top formation was previously formed in the near- term. The consoliadation might take places as the RSI is in the neutral condition and the pair is at the moment trading on the midline of the bollinger band, which signal that the clear move of the pair is indecisive as of now. And the price range for the consolidation is expected to see in between 1.3963 and 1.3896. To the downside, a convincing breach below 1.3896 will be seen as a fresh trigger for the bears; on the other hand, a break above 1.3963 will be seen as a short- term bullish momentum.

Resistance: 1.3963, 1.4017, 1.4072

Support: 1.3896, 1.3787

Economic Data

Daily Market Analysis

Market Focus

US equities traded in narrow range as momentum ran out of fuels. The tech heavy Nasdaq 100 index continue to make new highs to 14,274, lifted by rally in Tesla Inc. On the other hand, S&P 500 and the Dow Jones Industrial Average Index closed in the red, dipped 0.11% and 0.21% respectively.

The well-respected Dallas Fed President Robert Kaplan noted that the economy will likely outperform Federal Reserve’s expectation, leading to a possible early start of its tapering program. He explicitly said “I think we’d be far better off, from a risk-management point of view, beginning to adjust these purchases of Treasuries and mortgage-backed securities” during an interview with Bloomberg News. Wednesday’s upbeat manufacturing PMI of 62.6, the highest figure since 2007, further underpins a strong economic recovery in the US.

Treasury Secretary Janet Yellen said her department may start to ease emergency measures to avoid breaching the US debt limit as soon as August. ‘Suspension of debt limit’ means the Treasury Department can borrow as much as they need to pay off its current debts and obligations. With the current suspension set to expire on July 31, Yellen urged Congress to extend the suspension or increase the ceiling, and warned failing to do so would have absolutely catastrophic economic consequences.

Main Pairs Movement:

Major pairs are playing tug of war between gains and losses while trading at familiar levels on Thursday. Sentiment led the way, with currencies following the lead of stocks. USD fell throughout the first half of the day, regaining most of its lost at the final trading session of the day. The exception was USD/JPY which extended to a fresh yearly high of 111.10.

Markit released its June PMIs for all major economies. In general, the manufacturing sector recovery keeps outpacing that on the services sector. Despite mixed numbers, all figures indicated economic expansion.

The euro pair ended the day around 1.1930, slightly lower than yesterday, while cable settled around 1.3970, holding on to modest intraday gains. Commodity-linked currencies advanced against the greenback for a third consecutive day due to rising commodity prices, oil price as an example.

Gold once surged to $ 1,794.98 a troy ounce but changed course during the US afternoon and appeared doji at the end of the day.

Crude oil primers peaked at fresh yearly highs, easing modestly ahead of the close. WTI settled above $ 73.00 a barrel, as well as Brent touched $76 after the EIA reported that stockpiles decreased by 7.6 million barrels in the week ending June 18, better than anticipated.

The Bank of England is having a monetary policy meeting, although no fireworks are expected this time, as the bank won’t publish fresh macroeconomic projections, while there won’t be a speech from Governor Bailey.

Technical Analysis:

USDJPY (Four- Hour Chart)

USDJPY edges higher as Bank of Japan points to persistenetly low inflationary pressure while Powell cools down inflationary concern. On the four- hour chart, USDJPY is bullish in the outlook as it is well located in the ascending channel. At the moment, the pair even extends further above the trend line, heading toward the next immediate resistance of 111.10, which gives the pair more momentum to the upside. In the meanwhile, the piar keeps advaning above all of its SMAs, which indicates that the pair is gainning bullish traction. However, the pair might possibly confront an adjustment as the RSI is nearly in the overbought readings whilist the pair has reached the upper bounce of the bollinger band.

Resistance: 111.10

Support: 110.25, 109.72, 109.29

EURUSD (Daily Chart)

EURUSD weakens after hitting six- day highs at 1.1970, the highest since last Thursday. Failing to breach its resistance level of 1111 means that the pair is losing its short- term bullish tone. A consolidation will be likely to happen in the range of 1.1945 and 1.1860, which are the immediate resistance and support. On the daily chart, the pair remains bearish as it continues to trade below its SMAs; meanwhile, the MACD signals the note that the bearish momentum continue to be in control. To the upside, the pair needs to climb all the way up above 1.207 to reverse its current bearish mode. Otherwise, the pair remains bearish as the time of writing.

Resistance: 1.1945, 1.2349

Support: 1.1695, 1.1492, 1.1290

GBPUSD (Four- Hour Chart)

GBPUSD advances for the third session toward psychological resistance of 1.4000. Despite of still falling below the ascending channel, the pair seems to be on the track toward its bullish mode. Recent bullish move is not over yet, as the RSI is still outside of the overbought terriotry and the MACD is postive, lending supports to bulls. To the upside, the pair is heading to its next immediate resistance of 1.3968; if the pair can successfully breach the level, then it is one step closer back to the bullish trend.

Resistance: 1.3968, 1.4017, 1.4072

Support: 13896, 1.3787

Economic Data

Daily Market Analysis

Market Focus

Stock futures opened slightly higher Tuesday evening, holding onto gains from the regular session. The three major indexes ended higher for a second straight day, and the Nasdaq Composite surged to a record high as technology stocks outperformed. Microsoft (MSFT) shares steadied after jumping to a record level, bringing its market cap up to $2 trillion.

The S&P 500 extended gains into a second day as the Fed chief said he’s got “a level of confidence” that prices will eventually come down, while noting that it would be “very, very unlikely” to see the kind of 1970s-style inflation. In a testimony to the House Select Subcommittee Tuesday, Powell also said that a 5% inflation environment wouldn’t be acceptable, and urged patience at evaluating data on prices.

“So inlfation is larger than they expected,” said Art Hogan, chief strategist at National Securities. “That part is true. But the part about that’s going to force their hand faster than we think is the part that he’s pushing back on. I think markets have calmed down about that.”

Earlier Tuesday, New York Fed President John Williams noted that a discussion about raising interest rates is still “way off in the future.” At the same time, his Cleveland counterpart Loretta Mester said very low rates for a long period of time and unconventional policy tools such as asset purchases can lead to too much risk-taking and financial-stability issues.

Main Pairs Movement:

Optimism returned to financial markets and weighed on the greenback. However, dollar’s losses were limited and seemed corrective after last week’s surge. US Federal Reserve chief Jerome Powell testified before Congress on the Fed’s response to the pandemic.

High-yielding currencies posted modest intraday advances. The euro pair is currently trading at 1.1930, cable stands at 1.3940, while aussie hovers around 0.7560. The loonie pair approached the 1.2300 level, while ninja nears 2021 high at 110.96.

UK Health Minister Matt Hancock said covid-related data looks encouraging and suggests lockdown can fully end on July 19 as planned because a recent rise in cases is not resulting in deaths. On the other hand, concerns arose globally after the report of a new covid variant called Delta Plus, which may trigger new waves.

Little action around commodities. Gold keeps hovering around $ 1,780 per ounce, while crude oil prices retained gains. WTI settled at $73.00 a barrel, and Brent again stands on the $75.00 price level.

Cryptocurrencies were extremely volatile in the previous day. Bitcoin once tumbled below $30000, first time since January, and now rebouned back to $33500. Ethereum alike plummeted to its lowest level since March, and now struggled to get back to the $2000 price level.

Technical Analysis:

XAUUSD (Daily Chart)

Gold trades in a narrow range, around $1770ish, amid Powell’s testimony. In the near- term, bulls seem to be in control of gold as gold has breached the key resistance at $1770.95. In the meanwhile, both RSI and bollinger band signal that gold still have chance to the upside as the RSI is slightly above the oversold territory and gold is currently in the lower band of bollinger band, suggesting that gold is due to a bounce back. To the upside, if gold can climb all the way to its next resistance around $1820, then it will confirm its bullish as it will trade above the 50 SMA. Otherwise, the downside momentum is still in control in the bigger outlook.

Resistance: 1786.38, 1811.25, 1836.12

Support: 1755.6, 1705.86

EURUSD (Daily Chart)

EURUSD edges higher above 1.1930 level during the American trading hour. From the technical perspective, the pair remains bearish in the short- term as it continues to fall within the descending channel. The pair keeps clinging around Fibonacci resistance, the 61.8% retracement at 1.1945. On the daily time frame, the pair is scheduled to the downside as it is unable to recover above the 20 SMA. The technical indicator, RSI, retreats from the previous oversold territory whilst the MACD continues to lend supports to the bears. All in all, the pair remains skewed to the downside unless it can advance and breach above the 20 SMA, which is around 1.2100 level.

Resistance: 1.1945, 1.2349

Support: 1.1695, 1.1492, 1.1290

GBPUSD (Four- Hour Chart)

From the technical aspect, after the recent decline, GBPUSD reverses from bearish to bullish in the near- term. The bulls seems to be held and supported by the technical indicators; MACD is now bullish, lending supports to bulls, whilist the RSI is outside of the overbought territory, giving the pair rooms to extend further north. On the four- hour chart, the pair is heading to its next resistance at 1.3963. In order to turn bullish in a bigger outlook, the bulls need to break the price to the resistance level of 1.4139 to return to its former ascending channel. So far, the sterling is moving away from the descending trend line; further move of the pair will be afftected by the announcement of the BoE’s meeting.

Resistance: 1.3963, 1.4017

Support: 1.3896, 1.3787

Economic Data

Daily Market Analysis

Market Focus

Dow Jones futures, along with S&P 500 futures and Nasdaq 100 futures, were higher late Monday following the Dow Jones-led stock market rally. On Monday, the tech-heavy Nasdaq gained 0.84% (118.5 points), while the S&P 500 rallied 1.4% (59.2 points). The Dow Jones Industrial Average surged 1.8%, or 586 points. Among the Dow Jones leaders, Apple (AAPL) advanced 1.4% Monday, while Microsoft (MSFT) moved up 1.2% in today’s stock market; Tesla (TSLA) fell 0.4% Monday, as it battles to retake its long-term 200-day moving average.

Federal Reserve Chair Jerome Powell said inflation had picked up but should move back toward the U.S. central bank’s 2% target once supply imbalances resolve. “Inflation has increased notably in recent months,” Powell said in written remarks prepared for his Tuesday testimony before the House Select Subcommittee on the Coronavirus Crisis, citing increases in oil prices and a “rebound” in spending as the U.S. economy reopens. “As these transitory supply effects abate, inflation is expected to drop back toward our longer-run goal.” he said.

However, some Fed officials estimate that the central bank may need to tighten policy sooner than it expects. Dallas Fed President Robert Kaplan said he favors starting the process of tapering the central bank’s ongoing bond purchases “sooner rather than later,” while his counterpart from St. Louis, James Bullard, called it “appropriate” that policy makers last week opened the taper debate. Neither Bullard nor Kaplan votes on the Federal Open Market Committee this year.

Powell’s remarks reprised his opening comments at his June 16 press conference, following a policy meeting of the central bank. Investors will tune in to the hearing Tuesday for potential questions that shed more light on his view on the pace of the economic rebound and for how much longer the central bank should keep its monetary policy on an emergency footing.

Main Pairs Movement:

Dollar underwent a correction due to its extreme overbought conditions, but it remains the strongest currency across the Forex board. It lost most of its gains in the previous day during the North America session amid solid equity rallies.

Euro pair corrected up to 1.1920, holding nearby at the end of the day. ECB’s President Christine Lagarde said that the outlook for the euro area economy is brightening as the pandemic situation improves but warned about the need to remain vigilant, suggesting that tightening would be premature.

Cable surged on the optimistic market mood despite worrisome comments from the UK Prime Minister Boris Johnson. Johnson said that cases of the coronavirus Delta variant are still going up, and thus they need to be cautious on easing restrictions. He then added that data is looking good ahead of the July 19 deadline, but traveling will still be “difficult.”

Aussie trades around 0.7540, helped by the better performance of equities. Loonie pair plummeted over 100 pips on a daily basis, benefitting from the greenback’s corrective decline and soaring crude oil prices. WTI closed the day at $73.00 a barrel, while Brent climbed 2.20% during the day. Gold posted a modest daily advance. Spot gold settled at $ 1,784 a troy ounce.

Technical Analysis:

XAUUSD (Daily Chart)

Gold looks to pick up the recovery after dropping to the monthly low. In the near- term, it is expected to see some bulls on gold as it needs an adjustment from its oversold condition. From the technical indicators, both RSI and bollinger band show that gold needs a rest from its bearish momentum. The RSI is currently near 30 level, indicating that gold is due to a bounce back; at the same time, gold has reached the very lower band of bollinger band, which also suggests a bounce back from gold. At the moment, gold is clinging at the resistance level, 1780ish; to the upside, if gold can successfully breach the resistance, it will head toward 1811.25.

Resistance: 1786.38, 1811.25, 1836.12

Support: 1755.6, 1705.86

EURUSD (Daily Chart)

EURUSD recovers back to 1.1910 level to start the week as the time of writing, correcting extreme oversold conditions from last week. The pair remains bearish as it declined all the way below the descending channel to a new low last week; despite of showing a bounce back on Monday, the outlook remains bearish. After plunging sharply to April’s support level at 1.18760, the pair bounces back a little to its immediate resistance level at 1.1945. At the moment, the RSI is located at 30ish level, which is close to the oversold territory, giving the pair rooms to bounce back for an adjustment. Moreover, the MACD seems to turn positive on the four hour chart, lending supports to bulls. As the time of writing, EURUSD is trading along the resistance level at 1.1945; if it can successfully breaches the level, it will potentially head to the next resistance at 1.2070; otherwise, the pair might consolidate in the range of 1.1945 and 1.18760 in the near- term.

Resistance: 1.1945, 1.207, 1.2175

Support: 1.18760, 1.1695

GBPUSD (Four-Hour Chart)

GBPUSD advances beyond 1.3900 today, extending the corrective pullback. From the technical perspective, the intraday retreat from 1.3800 level could be attributed to a correction from the previous oversold condition. On the four- hour chart, GBPUSD remains bearish as it continues to fall below the descending channel; however, the short- term momentum seems to turn bullish as the technical indicator, RSI, is currently in the neutral position, giving the pair rooms to extend further north; in the meantime, the MACD has turned to positive, lending supports to bulls. To the upside, GBPUSD is expected to head toward the next immediate resistance at 1.3963, and 1.3896 will become the immediate support for the pair.

Resistance: 1.3896, 1.3963, 1.4017

Support: 1.3787

Economic Data