SUMMARY

  • U.S. inflation rose three basis points from the previous month. CPI stood at 3.5%, up from 3.2% previously.
  • According to the EIA, US crude oil inventories increased by 5.8 million barrels. This confirms the increase in global supply. The WTI price is currently up +0.08% and stands at USD 86.28 per barrel.
  • Traders are awaiting the ECB’s interest rate decision. The bank is expected to keep rates unchanged, even if inflation in the eurozone moves closer to the 2% target.

 

Key events:

  • Eurogroup meeting
  • OPEC monthly report
  • ECB interest rate decision
  • New claims for unemployment benefits in the United States
  • China trade balance
  • Japanese industrial production

GOLD

Specifications

  • Leverage: 100
  • Units: 100
  • Margin requirement: USD$2167
  • Example: movement of USD$10 = $1,000 potential PL.
  • Support 1: 2334,21
  • Support 2: 2332,79
  • Resistance 1: 2337,2
  • Resistance 2: 2338,77

Fundamental Analysis

  • U.S. inflation rose three basis points from the previous month. CPI came in at 3.5%, up from 3.2% previously. The result is generating considerable volatility in the markets. Gold corrected -0.72% at yesterday’s close as traders with long positions closed some of their trades.
  • Traders believe that the Fed may consider extending the current monetary policy strategy again, indicating that rate cuts are likely through the end of the year.
  • The Bank of Canada has maintained its interest rate at 5%.
  • The ECB is expected to keep interest rates at 4.50%.
  • The gold price corrected after reaching resistance at USD 2,360. The price fell to the lower Bollinger band, where buying interest was again generated.

WTI

Specifications

  • Leverage: 100
  • Units: 1,000
  • Margin requirement: USD$852
  • Example: movement of USD$1 = $1,000 potential PL.
  • Support 1: 86,24
  • Support 2: 86,21
  • Resistance 1: 86,31
  • Resistance 2: 86,35

Fundamental Analysis

  • According to the EIA, crude oil inventories in the United States increased by 5.8 million barrels. This confirms the increase in global supply. The WTI price is currently up +0.08% and stands at USD 86.28 per barrel.
  • OPEC+ is considering deeper production cuts as it expects demand to increase for the rest of the year.
  • The Biden administration has suspended LNG exports. For the time being, the country’s priority is domestic demand.
  • Rising gasoline prices have been one of the drivers of inflation in the United States.
  • The WTI price is trying to break out of its support zone. It is currently above its 40-day moving average. The weekly target remains at $88 a barrel.

EURUSD

Specifications

  • Leverage: 100
  • Units: 1,000
  • Margin requirement: USD$852
  • Example: movement of USD$1 = $1,000 potential PL.
  • Support 1: 1,0743
  • Support 2: 1,0739
  • Resistance 1: 1,0749
  • Resistance 2: 1,0751

Fundamental Analysis

  • Traders are awaiting the ECB’s decision on interest rates. The bank is expected to keep rates unchanged even if inflation in the eurozone moves closer to the 2% target.
  • Today also sees the Eurogroup meeting and Christine Lagarde’s statements as president of the ECB.
  • Following the US inflation figures, EUR/USD suffered a major correction. Yesterday, the currency closed with a drop of 1.04%. The currency immediately fell to a support zone.
  • It is currently in a sideways position around the 1.0745 area.
  • The currency is below its 40-day moving average. The price is above the 1 support at 1.0744. A new drop is expected, before attracting the attention of buyers.

SOURCES

  • Thomson Reuters
  • Market watch
  • Bloomberg
  • Tradingview

 

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