EUR/USD Price Analysis – July 17, 2024
Daily Price Outlook
During the European trading session, the EUR/USD currency pair maintained its upward trend, remaining well-bid around the 1.0937 level and hitting an intraday high of 1.0945.
The upward movement can be attributed to the weakening US dollar, which lost its bullish traction despite better-than-expected Retail Sales data reported by the US Census Bureau for June on Tuesday.
The decline in the US dollar was largely driven by heightened expectations of Fed rate cuts in September.
On the other side, the ECB's stance on interest rates and weakening economic sentiment in Germany are likely to pressure the EUR/USD pair. Expectations of further rate cuts and economic concerns could lead to euro depreciation against the US dollar as investors seek safer assets.
Impact of Fed Rate Cut Expectations and US Retail Sales on EUR/USD
On the US front, the broad-based US dollar has been under pressure recently as market participants expect potential rate cuts by the Federal Reserve starting in September. This sentiment has led US Treasury bond yields to hover around multi-month lows.
Meanwhile, Federal Reserve officials, Chair Jerome Powell and San Francisco Fed President Mary Daly, have suggested that inflation is nearing their target levels, bolstering expectations for forthcoming rate reductions. As a result, traders are factoring in the likelihood of multiple rate cuts before year-end.
In recent economic data, monthly Retail Sales held steady, meeting expectations, as increased sales in core goods offset sluggish demand for automobiles. Moreover, May's sales were upwardly revised to 0.3% from 0.1%.
These figures indicate a resilient consumer sector, supporting the overall economic outlook. However, despite these positive indicators, market expectations for Federal Reserve rate cuts commencing in September remain unchanged.
Therefore, the expectation of Fed rate cuts has weakened the US dollar, benefiting the EUR/USD pair, which has shown resilience amid steady US retail sales and revised upward figures.
ECB Policy and German Economic Sentiment Impact on EUR/USD
On the other side, the European Central Bank (ECB) is anticipated to maintain unchanged interest rates, with investors closely monitoring for hints regarding future rate adjustments.
In June, the ECB shifted away from its previously tight monetary policy stance due to easing inflation concerns stemming from pandemic-related stimulus measures.
Officials foresee inflation stabilizing near 2% by next year, though current pressures may persist into 2023. Market sentiment leans towards two additional rate cuts in 2024.
Meanwhile, Germany's economic sentiment, as gauged by the ZEW Survey, sharply declined to 41.8 in July, reflecting anxieties over weak domestic and international demand, affecting the Eurozone's largest economy.
Therefore, the expected ECB stance and economic sentiment in Germany could pressure the EUR/USD pair, weakening the euro against the US dollar as markets anticipate further rate cuts and economic uncertainties in the Eurozone.
EUR/USD - Technical Analysis
EUR/USD is currently trading at $1.0904, showing modest upward momentum. The 4-hour chart reveals critical price levels that could influence market direction. The pivot point is set at $1.0932, serving as a key level for potential trend shifts.
Immediate resistance is identified at $1.0923, followed by $1.0940 and $1.0964. These resistance levels indicate potential targets if the price breaks above the pivot point, suggesting a continuation of the bullish trend.
On the downside, immediate support is found at $1.0861, with subsequent support levels at $1.0838 and $1.0817. These levels are crucial for maintaining the current trend and could act as buffers against any sharp declines.
The Relative Strength Index (RSI) is at 61, indicating that the market is in neutral territory but showing signs of upward momentum.
The 50-day Exponential Moving Average (EMA) is positioned at $1.0858, which aligns with the immediate support level, providing additional strength to the current price trend. This EMA acts as a significant indicator of the underlying trend and helps identify potential reversal points.
In conclusion, the outlook for EUR/USD remains bullish above the pivot point of $1.0932. Traders are advised to buy above $1.08940, with an entry price at this level, aiming for a take profit at $1.09323 and setting a stop loss at $1.08722.
EUR/USD is currently trading at $1.0904, showing modest upward momentum. The 4-hour chart reveals critical price levels that could influence market direction. The pivot point is set at $1.0932, serving as a key level for potential trend shifts. Immediate resistance is identified at $1.0923, followed by $1.0940 and $1.0964.
These resistance levels indicate potential targets if the price breaks above the pivot point, suggesting a continuation of the bullish trend.
On the downside, immediate support is found at $1.0861, with subsequent support levels at $1.0838 and $1.0817. These levels are crucial for maintaining the current trend and could act as buffers against any sharp declines.
The Relative Strength Index (RSI) is at 61, indicating that the market is in neutral territory but showing signs of upward momentum.
The 50-day Exponential Moving Average (EMA) is positioned at $1.0858, which aligns with the immediate support level, providing additional strength to the current price trend. This EMA acts as a significant indicator of the underlying trend and helps identify potential reversal points.
In conclusion, the outlook for EUR/USD remains bullish above the pivot point of $1.0932. Traders are advised to buy above $1.08940, with an entry price at this level, aiming for a take profit at $1.09323 and setting a stop loss at $1.08722.
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GBP/USD Price Analysis – July 17, 2024
GBP/USD Price Analysis – July 17, 2024
Daily Price Outlook
During the European trading session, the GBP/USD currency pair maintained its upward trend, remaining well bid around the 1.3034 level and hitting an intraday high of 1.3045.
The upward movement can be attributed to the weakening US dollar, which lost its bullish traction despite better-than-expected Retail Sales data reported by the US Census Bureau for June on Tuesday.
The decline in the US dollar was largely driven by heightened expectations of Fed rate cuts in September. Another supportive factor for the GBP/USD pair was the resilient Consumer Price Index (CPI) data reported by the UK Office for National Statistics (ONS) for June, indicating ongoing inflationary pressures in the UK that could bolster the pound against the dollar.
UK CPI Data and BoE Policy Outlook Impact on GBP/USD Pair
On the BoE front, the UK Office for National Statistics reported that June's Consumer Price Index (CPI) showed steady annual increases, with headline inflation at 2.0% and core inflation at 3.5%, excluding volatile food and energy items.
Service sector inflation remained high at 5.7%, which is concerning for BoE policymakers who are cautious about normalizing policy. Month-on-month, inflation saw a slower rise of 0.1%, in line with expectations.
This persistent CPI data suggests that the BoE may delay monetary policy tightening, reducing speculation of rate hikes starting in August. The next focal point for Pound Sterling will be the upcoming employment data, crucial for assessing trends in wage growth.
Therefore, the stubborn CPI data and potential BoE hesitation to cut rates strengthen the GBP/USD pair, as the pound gains support from anticipated continued restrictive monetary policy.
Anticipated Fed Rate Cuts and Steady US Retail Sales Likely to Boost GBP/USD Pair
On the US front, the broad-based US dollar has weakened as investors anticipate rate cuts by the Federal Reserve beginning in September. This expectation has kept US Treasury bond yields near multi-month lows, preventing the dollar from recovering from its recent three-month low.
Federal Reserve officials, including Chair Jerome Powell and San Francisco Fed President Mary Daly, have indicated that inflation is approaching their target, strengthening expectations of imminent rate cuts. This outlook has prompted traders to price in multiple rate cuts by the end of the year.
On the data front, monthly Retail Sales remained steady, matching expectations, with higher core goods sales balancing weak auto demand. May's sales were revised up to 0.3% from 0.1%. This improvement in retail sales supports the economic outlook but doesn't change firm market expectations of Fed rate cuts starting in September.
Therefore, the anticipation of Fed rate cuts and steady US retail sales, coupled with a weakened US dollar, could boost the GBP/USD pair as the pound gains strength against a softer dollar.
GBP/USD - Technical Analysis
GBP/USD is currently trading at $1.2992, displaying a slight upward bias. The 4-hour chart highlights significant price levels that traders should monitor closely. The pivot point is set at $1.3019, serving as a critical level for potential trend direction.
Immediate resistance is identified at $1.3019, followed by $1.3058 and $1.3095. These resistance levels represent potential targets if the price breaks above the pivot point, indicating a continuation of the bullish trend.
On the downside, immediate support is observed at $1.2932, with subsequent support levels at $1.2898 and $1.2858.
These levels are crucial for maintaining the current trend and could act as buffers against any sharp declines. The Relative Strength Index (RSI) is at 69, indicating that the market is nearing overbought territory but still showing signs of strong buying interest.
The 50-day Exponential Moving Average (EMA) is positioned at $1.2883, which aligns with the immediate support level, providing additional strength to the current price trend. This EMA acts as a significant indicator of the underlying trend and helps identify potential reversal points.
In conclusion, the outlook for GBP/USD remains bullish above the pivot point of $1.3019. Traders are advised to buy above $1.29678, with an entry price at this level, aiming for a take profit at $1.30193 and setting a stop loss at $1.29416.
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GOLD Price Analysis – July 17, 2024
GOLD Price Analysis – July 17, 2024
Daily Price Outlook
Gold price (XAU/USD) regained its upward trend and drew strong bids around the 2,475.99 level, hitting an intraday high of 2,482.41. The upward rally can be attributed to growing expectations that the Federal Reserve will begin cutting interest rates as early as September.
This put downward pressure on the US dollar and contributed to the gains in the gold price
Impact of Fed Rate Cut Expectations on Gold Prices
On the US front, the broad-based US dollar has lost momentum as investors anticipate rate cuts by the Federal Reserve starting in September.
This belief has kept US Treasury bond yields near multi-month lows, preventing the dollar from rebounding from its recent three-month low. Federal Reserve officials, including Chair Jerome Powell and San Francisco Fed President Mary Daly, have signaled that inflation is nearing their target, reinforcing expectations of rate cuts.
This outlook has led traders to price in multiple rate cuts by year-end, boosting non-yielding assets like gold, which benefits from lower interest rates. US Retail Sales data for June showed no change, with upward revisions in May indicating consumer resilience, supporting economic growth prospects for the second quarter.
Therefore, the anticipation of Fed rate cuts, reinforced by near-record low Treasury yields and Federal Reserve officials' inflation outlook, has boosted gold prices as investors seek safe-haven assets amid lower interest rates.
GOLD (XAU/USD) - Technical Analysis
Gold (XAU/USD) is trading at $2,465.89, showing slight market adjustments as it approaches significant resistance levels. The 4-hour chart reveals pivotal price points that are essential for traders to watch closely.
The pivot point is positioned at $2,478.20, indicating a critical level for potential market shifts. Immediate resistance is identified at $2,495.71, followed by $2,511.63 and $2,529.15. These resistance levels represent potential upward targets if the price manages to break above the pivot point, signaling a continuation of the bullish trend.
On the downside, immediate support is noted at $2,443.97, with further support levels at $2,419.30 and $2,397.41. These levels are crucial for maintaining the current trend and could serve as buffers against any sharp declines.
The Relative Strength Index (RSI) is currently at 75, indicating that the market is in an overbought condition. This suggests that there might be limited room for further upward movement before a potential correction.
The 50-day Exponential Moving Average (EMA) is at $2,397.94, which provides additional support and aligns with the lower support levels. This EMA acts as a significant indicator of the underlying trend and helps identify potential reversal points.
In conclusion, Gold remains bearish below the pivot point of $2,478.20. A break above this level could boost bullish sentiment, targeting the resistance levels of $2,495.71 and beyond.
Conversely, maintaining below the pivot point suggests continued downside risk. Traders are advised to sell below $2,478, with an entry price at this level, aiming for a take profit at $2,449 and setting a stop loss at $2,495.
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EUR/USD Price Analysis – July 17, 2024
AUD/USD Price Analysis – July 16, 2024
Daily Price Outlook
During the European trading session, the AUD/USD pair continued its bearish trend, remaining under pressure around the 0.6744 level and hitting an intraday low of 0.6732. The downward movement can be attributed to the strength of the US dollar, which gained ground despite dovish comments from Federal Reserve Chair Jerome Powell on monetary policy.
The dollar's rise was fueled by recent events, including an unsuccessful attempt on Donald Trump's life, which has boosted his prospects for the 2024 presidential election and raised expectations of fewer regulations under his potential leadership.
Moving ahead, traders will keep their eyes on Australia's June Employment data, set for release on Thursday. Economists predict around 20,000 new jobs were added, down from 39,700 in May.
The Unemployment Rate is expected to hold steady at 4.0%. Strong signs of a tight labor market could raise expectations for further tightening by the Reserve Bank of Australia (RBA). Currently, investors anticipate the RBA may follow the global trend of rate cuts next year.
Impact of US Dollar Strength on AUD/USD Amid Political and Economic Expectations
On the US front, the broad-based US dollar gained positive traction and remained bullish as the recent events, including an unsuccessful attempt on Donald Trump's life, have bolstered his prospects for winning the 2024 presidential election, sparking hopes of reduced regulations under his potential leadership.
Moreover, the US dollar has strengthened on expectations that Trump's policies could lead to higher government debt and inflation.
Therefore, the US dollar's bullish sentiment, bolstered by events like an unsuccessful attempt on Donald Trump's life and expectations of reduced regulations and higher debt, has strengthened against the Australian dollar (AUD/USD), likely pushing the pair lower amid increased risk aversion and dollar demand.
US Dollar Strength and Fed's Policy Signals Impact on AUD/USD Pair
On the US front, Federal Reserve Chair Jerome Powell's dovish comments on Monday bolstered the US dollar against the Australian dollar (AUD/USD). His confidence in inflation nearing the Fed's target sustainably has raised expectations of potential interest rate cuts. This outlook has capped gains in the US dollar, potentially helping the AUD/USD pair to limit its deeper losses.
Meanwhile, Fed Bank of San Francisco President Mary Daly highlighted a cooling inflation trend, suggesting that inflation is on track toward the Fed's 2% target.
She emphasized the importance of gathering more data before making decisions on interest rates. Market sentiment, as reflected in CME Group’s FedWatch Tool, now indicates an 85.7% probability of a 25-basis point rate cut in September, up from 71.0% reported last week.
Hence, Federal Reserve Chair Jerome Powell's dovish comments on Monday capped gains in the US dollar against the Australian dollar (AUD/USD). His confidence in inflation nearing the Fed's target sustainably has raised expectations of potential interest rate cuts, influencing the pair's movements.
AUD/USD - Technical Analysis
The Australian Dollar (AUD/USD) is currently trading at $0.67365, down 0.17% from the previous session. The 4-hour chart highlights key price levels, with the pivot point set at $0.67. Immediate resistance is observed at $0.68, followed by further resistance levels at $0.6825 and $0.6850.
On the downside, immediate support is noted at $0.6710, with additional support at $0.6690 and $0.6670.
The Relative Strength Index (RSI) stands at 30, indicating that the pair is approaching oversold conditions.
This could suggest a potential rebound if the bearish momentum begins to wane. The 50-day Exponential Moving Average (EMA) is positioned at $0.68, providing a key resistance level that the price must overcome to shift towards a more bullish outlook.
The recent decline in the AUD/USD can be attributed to a strengthening U.S. dollar, driven by positive economic data and market expectations of future interest rate hikes by the Federal Reserve.
Additionally, weaker commodity prices and concerns over China's economic slowdown have put additional pressure on the Australian Dollar, which is heavily influenced by global commodity demand.
Traders looking to capitalize on the current downtrend should consider entering short positions below $0.67468, with a take-profit target at $0.67212 and a stop-loss set at $0.67622. This strategy aims to benefit from continued bearish momentum while managing potential risks effectively.
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USD/CAD Price Analysis – July 16, 2024
GOLD Price Analysis – July 16, 2024
Daily Price Outlook
Gold price (XAU/USD) extended its upward trend, remaining well bid around the 2,440 level and hitting an intraday high of 2,443.
This upward movement is attributed to dovish comments from Federal Reserve Chair Jerome Powell regarding monetary policy, which have increased the appeal of precious metals. Lower borrowing costs make non-yielding assets like gold more attractive to investors.
Investors appear convinced that the US central bank will begin a rate-cutting cycle in September, a sentiment reaffirmed by Powell's recent remarks. This outlook has kept US Treasury bond yields depressed, benefiting the non-yielding yellow metal.
However, the pace of gold price gains could slow following Monday's economic data, which revealed weaker-than-expected second-quarter economic growth in China, reflecting sluggish domestic demand.
Impact of Fed Chair Jerome Powell's Dovish Comments on Gold Prices
On the US front, Federal Reserve Chair Jerome Powell's dovish comments on Monday bolstered precious metals like gold, as lower borrowing costs make them more attractive to investors. Powell indicated confidence in inflation nearing the Fed's target sustainably, suggesting potential interest rate cuts ahead.
Meanwhile, Fed Bank of San Francisco President Mary Daly noted a cooling inflation trend, supporting the view that inflation is heading towards 2%, though she emphasized the need for more data before deciding on rates.
Market expectations, reflected in CME Group’s FedWatch Tool, now show an 85.7% likelihood of a 25-basis point rate cut in September, up from 71.0% last week. Eyes are now on the upcoming US Retail Sales data for June for further economic insights.
Thus, the Federal Reserve Chair Jerome Powell's dovish stance and expectations of interest rate cuts have boosted gold prices, with lower borrowing costs enhancing the metal's attractiveness to investors seeking non-yielding assets.
Impact of China's Economic Slowdown and Trade Tensions on Gold Prices
On the other hand, gold prices face some challenges due to recent economic data indicating slower-than-expected growth in China's GDP for the second quarter, driven by weak domestic demand.
Meanwhile, the ongoing third plenum of the Chinese Communist Party's 20th National Congress, scheduled from July 15 to 18, underscores ongoing economic policy discussions amidst this economic slowdown.
Standard Chartered forecasts potential rate cuts by the People's Bank of China and adjustments to the reserve requirement ratio in response to the GDP deceleration. China's economic growth remains uneven, further complicated by escalating trade tensions; the US and EU recently imposed new tariffs on Chinese electric vehicles, impacting global trade dynamics.
Therefore, the potential economic slowdown in China, coupled with ongoing policy adjustments and trade tensions, may weigh on gold prices, as investors monitor developments that could affect global economic stability and demand for safe-haven assets.
GOLD (XAU/USD) - Technical Analysis
Gold (XAU/USD) is currently priced at $2,437.32, showing an increase of 0.19%. The 4-hour chart reveals critical price levels, with the pivot point at $2,445. Immediate resistance is found at $2,442.50, with further resistance at $2,453.71 and $2,466.69.
On the downside, immediate support is situated at $2,419.84, followed by $2,403.30 and $2,391.59.
The Relative Strength Index (RSI) is currently at 69, indicating that gold is nearing overbought territory, suggesting that traders should monitor for potential signs of a pullback. The 50-day Exponential Moving Average (EMA) is at $2,403.58, supporting the ongoing bullish trend.
Gold's recent performance has been buoyed by market expectations of a potential interest rate cut by the Federal Reserve in September. These expectations have kept U.S. Treasury yields depressed, making non-yielding assets like gold more attractive.
The metal's current bullish trend is further reinforced by global economic uncertainties and geopolitical tensions, which typically drive investors towards safe-haven assets.
Traders looking to enter the market should consider buying above $2,430, targeting a take-profit level at $2,445, while setting a stop-loss at $2,422 to manage potential downside risks. Maintaining these strategic levels is crucial as it allows traders to capitalize on the prevailing bullish momentum while mitigating potential losses.
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USD/CAD Price Analysis – July 16, 2024
USD/CAD Price Analysis – July 16, 2024
Daily Price Outlook
During the European trading session, the USD/CAD currency pair maintained its upward trend, holding strong around the 1.3685 level and reaching an intraday high of 1.3695.
The rally can be attributed to a bullish US dollar, bolstered by recent developments including an unsuccessful attempt on Donald Trump's life, which has bolstered his prospects for the 2024 presidential election, raising expectations of reduced regulations under his potential leadership.
Additionally, declining oil prices have weighed on the commodity-linked Canadian Dollar (CAD), further contributing to gains in the USD/CAD pair.
Impact of WTI Oil Price Decline and Chinese Economic Slowdown on USD/CAD Pair
On the other hand, West Texas Intermediate (WTI) oil prices have been declining for three consecutive sessions, currently trading around $80.30 per barrel. This drop is linked to a slowdown in the Chinese economy, reducing demand from the world's largest oil importer.
China's GDP grew 4.7% year-over-year in the second quarter, down from 5.3% in the first quarter and below expectations of 5.1%. The National Bureau of Statistics (NBS) noted stable economic operation in the first half of the year with a 5.0% growth rate.
Traders are now focused on Canada's upcoming Consumer Price Index (CPI) inflation data, crucial for the Bank of Canada's (BoC) decision on potential further rate cuts post a recent quarter-point reduction in June.
Therefore, the decline in WTI oil prices, driven by China's economic slowdown, may strengthen the USD/CAD pair due to reduced demand for the Canadian Dollar and expectations around the Bank of Canada's policy response to inflation data.
Impact of US Dollar Strength and Fed's Policy on USD/CAD Pair
On the US front, the US dollar gained strength due to recent events, including an unsuccessful attempt on Donald Trump's life, boosting his prospects for the 2024 presidential election and sparking hopes of reduced regulations under his potential leadership.
Additionally, expectations of higher government debt and inflation under Trump's policies further bolstered the dollar. This bullish sentiment strengthened the US dollar against the Australian dollar (AUD/USD), driving the pair lower amid increased risk aversion and dollar demand.
Meanwhile, Federal Reserve Chair Jerome Powell's dovish comments on inflation, indicating confidence in reaching the Fed's target sustainably, raised expectations of potential interest rate cuts, which initially capped gains in the US dollar against the CAD.
Meanwhile, Fed Bank of San Francisco President Mary Daly noted a cooling inflation trend, suggesting the Fed is on track toward its 2% target and emphasizing the need for more data before deciding on interest rates. Market sentiment now indicates an 85.7% probability of a 25-basis point rate cut in September, up from 71.0% last week.
Therefore, the US dollar's strength, fueled by events boosting Trump's election prospects and expectations of higher debt and inflation, likely strengthens against the Canadian dollar (USD/CAD) amid increased risk aversion and anticipations of Fed interest rate cuts.
USD/CAD - Technical Analysis
The USD/CAD pair is currently trading at $1.36888, showing negligible movement from the previous session. The 4-hour chart delineates significant price levels, with the pivot point situated at $1.3692. Immediate resistance is noted at $1.3720, followed by $1.3756 and $1.3782. On the downside, immediate support lies at $1.3672, with further support levels at $1.3653 and $1.3629.
The Relative Strength Index (RSI) is positioned at 65, indicating the pair is approaching overbought conditions.
This suggests potential caution for traders as the pair nears resistance levels. The 50-day Exponential Moving Average (EMA) is recorded at $1.3634, which acts as a critical support level, indicating the overall bullish trend remains intact if the price stays above this mark.
The recent stability in the USD/CAD can be attributed to mixed economic signals from both the U.S. and Canada. While the U.S. economy shows robust performance, bolstered by positive economic indicators and speculation about future rate hikes, the Canadian dollar is supported by strong commodity prices, particularly oil, which is a significant export for Canada.
Traders considering positions in the USD/CAD pair should look to buy above $1.36783, with a take-profit target at $1.37133 and a stop-loss set at $1.36591. This strategy leverages the current bullish sentiment while protecting against potential downside risks.
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AUD/USD Price Analysis – July 16, 2024
GBP/USD Price Analysis – July 15, 2024
Daily Price Outlook
Despite investors initially favoring the United Kingdom (UK) markets for investment, the GBP/USD currency pair failed to sustain its upward momentum. It turned bearish around the 1.2978 level, reaching an intra-day low of 1.2962.
This downturn can be attributed to the strengthening US dollar, which has gained momentum despite expectations of potential Federal Reserve interest rate cuts. Heightened safe-haven demand for the US dollar followed reports of an attempted assassination of former US President Donald Trump, adding further downward pressure on GBP/USD.
While uncertainty over potential Bank of England rate cuts initially supported the Sterling, contrasting expectations with the Fed's easing stance contributed to the pair's decline.
Impact of Geopolitical Events and Economic Data on GBP/USD Pair
Despite increasing expectations of Federal Reserve interest rate cuts starting in September, the broad-based US dollar has shown strength, bolstered by reports of an attempted assassination of former US President Donald Trump. This has exerted downward pressure on silver prices.
However, market sentiment strongly leans towards a Fed rate cut in September, supported by a recent report indicating subdued levels of US consumer inflation. Economically, the US Bureau of Labor Statistics reported a 2.6% increase in the Producer Price Index (PPI) for final demand in June, surpassing expectations of 2.3%.
Therefore, the US Dollar has remained strong despite expectations of Fed rate cuts, influenced by geopolitical events and solid economic data. This has contributed to downward pressure on the GBP/USD pair.
Impact of BoE Rate Cut Uncertainty on GBP/USD Pair
On the Bank of England front, uncertainty about lowering interest rates has boosted the Pound Sterling, making it stronger against other major currencies this Monday. Investors prefer UK markets because they see stability under Keir Starmer's Labour Party, especially compared to political uncertainties in the EU and US.
Many expect the Bank of England to start cutting rates in August, but policymakers are hesitant due to high inflation in the service sector driven by strong wage growth. This week, upcoming UK data on inflation and employment will give more clarity. If inflation is slightly lower and wage growth slows, it could affect future BoE decisions.
Therefore, the uncertainty over BoE rate cuts has supported the Pound against major currencies like the US Dollar, reflecting investor preference for UK stability. Expectations from upcoming UK economic data could further influence GBP/USD dynamics.
GBP/USD - Technical Analysis
The GBP/USD pair is currently trading at $1.29725, reflecting a slight increase of 0.12%. The 4-hour chart highlights crucial levels that could dictate the pair's movement. The pivot point is set at $1.3010, a significant marker for potential shifts in direction.
Immediate resistance is identified at $1.2991, with further resistance at $1.3028 and $1.3068. These levels are critical for traders to watch, as they indicate where upward momentum might face obstacles.
On the downside, immediate support is located at $1.2898, followed by $1.2858 and $1.2817, suggesting zones where prices could stabilize or rebound if selling pressure increases.
Technical indicators provide deeper insights into market sentiment. The Relative Strength Index (RSI) is at 68, indicating the pair is approaching overbought territory. This suggests caution for traders considering long positions.
The 50-day Exponential Moving Average (EMA) stands at $1.2879, acting as a dynamic support level that could prevent further declines if the price remains above this average.
Given these observations, the outlook for GBP/USD suggests a cautious bullish sentiment above the pivot point of $1.3010. An entry price to buy above $1.29588 could be considered, targeting a take profit at $1.30103, with a stop loss set at $1.29326 to manage risk effectively.
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EUR/USD Price Analysis – July 15, 2024
GOLD Price Analysis – July 15, 2024
Daily Price Outlook
Gold price (XAU/USD) managed to stop its early-day losses and drew strong fresh bids around the 1,912 level. The reason for its upward trend could be attributed to the growing speculation for Fed rate cuts in September.
However, the gains in the gold price could be short-lived or limited as the US Dollar gained ground after an assassination attempt on former United States (US) President Donald Trump improved the US Dollar’s appeal. Nevertheless, the near-term outlook for the gold price remains firm as US bond yields weaken.
US Treasury yields fall as market expectations for the Fed to begin reducing interest rates from the September meeting have accelerated significantly.
Impact of Economic Indicators on Gold Prices and Market Outlook
On the US front, the outlook for gold remains strong as US bond yields weaken. Although the 10-year US Treasury yields edged higher to 4.20%, they are still near a four-month low as the lower yields reduce the opportunity cost of holding non-yielding assets like gold.
Market expectations for the Fed to start reducing interest rates from September have surged due to easing US consumer inflation and a cooling labor market. Last week's US Consumer Price Index (CPI) report for June showed inflation slowing faster than expected, boosting confidence in the ongoing disinflation process.
Additionally, the US Bureau of Labor Statistics reported on Friday that the Producer Price Index (PPI) for final demand increased by 2.6% in June, exceeding the expected 2.3%, indicating potential inflationary pressures in the production pipeline.
Therefore, the impact of this news on gold prices is positive. As US bond yields weaken and inflation eases, the opportunity cost of holding non-yielding assets like gold decreases.
Additionally, rising expectations for Fed rate cuts enhance gold's appeal as an investment, contributing to firmer near-term prices.
Moving on, this week investors will focus on US Retail Sales data for June, expected to show no change after a 0.1% growth in May, to be published Tuesday. On Monday, attention will be on Fed Chair Jerome Powell’s speech at 16:30 GMT, where he may discuss inflation and interest rates.
GOLD (XAU/USD) - Technical Analysis
Gold (XAU/USD) is currently trading at $2404.275, showing a slight decline of 0.01%. The 4-hour chart highlights key levels that traders should be aware of to navigate potential price movements.
The pivot point is set at $2392.41, a critical juncture that can indicate the direction of future price action.
Immediate resistance is observed at $2418.65, with further resistance levels at $2430.04 and $2441.14. These levels are essential for traders to watch, as they can signal where upward momentum might face challenges.
Conversely, on the downside, immediate support is identified at $2380.69, followed by $2370.16 and $2355.08. These support levels suggest potential areas where prices could stabilize or rebound if selling pressure increases.
Technical indicators provide further insights into the current market sentiment. The Relative Strength Index (RSI) is at 52, indicating a neutral stance without strong overbought or oversold conditions.
This neutrality suggests that the market is balanced and not skewed heavily in one direction. The 50-day Exponential Moving Average (EMA) is positioned at $2388.37, serving as a dynamic support level. The price remaining above this average could prevent further declines, signaling that buyers are stepping in at this level.
Given these observations, the outlook for Gold (XAU/USD) suggests a cautious bearish sentiment below the pivot point of $2392.41. Traders might consider an entry price to sell below $2405, aiming for a take profit at $2392.
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EUR/USD Price Analysis – July 15, 2024
EUR/USD Price Analysis – July 15, 2024
Daily Price Outlook
During the European trading session, the EUR/USD currency pair maintained its upward momentum, hovering around the $1.0912 mark and reaching an intra-day high of 1.0920.
This upward movement was primarily driven by a weaker US dollar, which lost ground amid growing expectations that the Federal Reserve (Fed) may start cutting interest rates starting from its September meeting.
Additionally, the Euro gained strength as investors showed increased interest ahead of the European Central Bank (ECB) policy meeting, further supporting the EUR/USD pair's rise.
Impact on EUR/USD Pair Amidst Fed Rate Cut Expectations
On the US front, the broad-based US dollar slipped to around 104.00 as markets anticipate a Federal Reserve interest rate cut in September. This outlook stems from easing inflation pressures and a tepid labor market, as highlighted by slower-than-expected growth in June's Consumer Price Index.
Investors are closely watching Fed Chair Jerome Powell's upcoming speech at 16:30 GMT for clues on the timing of potential rate cuts.
These developments are likely to influence the EUR/USD pair, potentially weakening the dollar against the euro if the Fed signals a dovish monetary policy stance in response to economic conditions.
Impact of ECB Monetary Policy on EUR/USD Pair
On the EUR front, Investors are closely eyeing the upcoming ECB monetary policy meeting, where the central bank is anticipated to keep its key rates unchanged.
The focus lies on signals regarding potential future rate cuts, following the ECB's recent decision on June 6 to reduce interest rates for the first time since it began tightening policy back in July 2022.
This move underscores ongoing economic conditions and will shape market expectations for the euro's performance against major currencies like the US dollar. Traders are keenly assessing the ECB's stance on monetary policy adjustments amid prevailing global economic uncertainties.
Therefore, the ECB's expected unchanged rates and hints on future cuts could bolster the euro against the dollar, depending on how markets interpret the ECB's outlook compared to the Fed's dovish stance.
EUR/USD - Technical Analysis
The EUR/USD pair is currently trading at $1.08884, marking a slight uptick of 0.12%. The 4-hour chart delineates crucial levels that traders should consider. The pivot point is established at $1.0909, a key indicator for potential directional changes.
Immediate resistance is identified at $1.0909, with subsequent resistance levels at $1.0924 and $1.0940. These levels are critical as they mark potential barriers to upward movement.
On the downside, immediate support is found at $1.0860, followed by $1.0844 and $1.0824, indicating zones where prices might find stability or bounce back if downward pressure intensifies.
Technical indicators offer further insight into the current market sentiment. The Relative Strength Index (RSI) is at 58, suggesting a moderately bullish trend without overbought conditions.
This indicates room for potential upward movement. The 50-day Exponential Moving Average (EMA) is positioned at $1.0852, serving as a dynamic support level that could help prevent further declines if the price stays above this average.
Given these observations, the outlook for EUR/USD suggests a cautiously bullish sentiment above the pivot point of $1.0909. An entry price to buy above $1.08806 could be considered, aiming for a take profit at $1.09092, with a stop loss set at $1.08651 to effectively manage risk.
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EUR/USD Price Analysis – July 12, 2024
Daily Price Outlook
The EUR/USD currency pair maintained its upward trend and gained further ground around the 1.0890 level, reaching an intraday high of 1.0892. The rally can be attributed to a weaker US dollar, which lost ground following softer-than-expected US consumer inflation figures released previously.
This has raised expectations that the Federal Reserve might cut interest rates in September, putting pressure on the US dollar and contributing to gains in the EUR/USD pair.
Additionally, diminished expectations for ECB rate cuts, influenced by stable price pressures throughout the year and a cautious stance from policymakers, have also supported the EUR/USD pair.
Impact of US Inflation Data and Fed Rate Cut Expectations on the EUR/USD Pair
On the US front, the broad-based US dollar weakened today due to softer-than-expected US consumer inflation figures released earlier. This has heightened expectations that the Federal Reserve might cut interest rates in September.
According to the CME FedWatch tool, there is now certainty about a rate cut in September, with potential for another cut in either November or December.
The latest US Consumer Price Index (CPI) data for June, released Thursday, showed a resumption of disinflation after a brief pause in the first quarter of the year, prompting these expectations for Fed action.
On the data front, annual core inflation, which Fed officials closely monitor (excluding volatile food and energy prices), unexpectedly slowed to 3.3%, below economists' expectations of 3.4%.
Headline inflation also dipped to 3.0%, its lowest in a year, driven by lower energy costs and rental prices. Monthly headline inflation declined by 0.1% after holding steady in May.
These cooling inflationary pressures, alongside softer labor market conditions, have boosted Fed confidence in reaching their 2% inflation target. San Francisco Fed President Mary Daly welcomed the slowdown, supporting the case for lower interest rates, though the timing of rate cuts remains debated.
Therefore, the weakening US dollar following softer inflation data and expected Fed rate cuts may strengthen the EUR/USD pair. Lower interest rate expectations in the US compared to stable or potentially higher rates in the Eurozone could support the euro against the dollar.
Impact on EUR/USD Pair Amid Reduced ECB Rate Cut Expectations
On the EUR front, the expectations for the European Central Bank (ECB) to lower interest rates have cooled. This shift comes as ECB officials believe that inflation pressures will stay steady throughout the year.
They're cautious about slashing rates too quickly, fearing it could spark higher inflation once more. Instead of committing to a fixed plan for rate cuts, they're taking a wait-and-see approach. This means they're monitoring economic conditions closely before deciding on any aggressive moves to stimulate the economy through lower interest rates.
Therefore, the reduced expectations for ECB rate cuts typically strengthen the euro (EUR), potentially boosting the EUR/USD pair as investors perceive less economic stimulus and stable inflation in the Eurozone.
EUR/USD - Technical Analysis
The EUR/USD pair is holding steady, hovering just below the pivot point of $1.0887. Despite a marginal dip of 0.01%, the pair remains within striking distance of this key level, suggesting the potential for a breakout in either direction.
The 50-day Exponential Moving Average (EMA) stands at $1.0834, providing a solid foundation of support should the pair experience a pullback.
The Relative Strength Index (RSI) currently reads 64, indicating that the pair is neither overbought nor oversold. This neutral reading suggests that the pair could consolidate around current levels before making a decisive move.
Traders should closely monitor the price action around the pivot point, as a break above this level could signal further upside momentum, potentially targeting the $1.0900 resistance level.
However, a failure to breach the pivot point could see the pair retreat towards the immediate support at $1.0843. A decisive break below this level could trigger further downside pressure, potentially pushing the pair towards the $1.0823 support level.
Given the current consolidation, traders should exercise caution and wait for a clear breakout before initiating new positions.
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