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The US dollar pairs remain the centre stage of attention for the next two days. The dollar index, which tracks the U.S. currency against six major peers reversed from the 11-week highs and ended lower on Wednesday. The index had good two-way price moves since the beginning of this week. Meanwhile, technical indicators on lower timeframes have just started gaining negative traction. The bearish sentiment was fueled after the US preliminary PMI data for August disappoints.
Looking ahead, it seems safe to assume that movement in the greenback will remain highly volatile. For today, the dollar traders and investors also should closely monitor the release of July Durable Goods Orders and weekly Initial Jobless Claims data. However, the key speech from Fed Chair Powell Friday at the annual Jackson Hole Symposium will be crucial to watch, his comments could determine the next move for the king dollar.
From a technical perspective, immediate support for DXY is expected at the 103 area, with this zone having been held recently. In contrast, further down, demand is also expected around 102.70, which will act as the next support area. On the flip side, 104/104.10 remains the key supply area to focus on.
EQUITIES
European and UK shares opened higher while US stock futures struggled to extend the upside momentum as investors cautiously awaited Federal Reserve Chair Jerome Powell’s speech. Meanwhile, the overall market sentiment was boosted following the release of strong Q2 earnings results from Nvidia and its upbeat guidance. The chipmaker’s shares surged as much as 10% in aftermarket trading after the company’s latest earnings and forecast beat estimates.
OIL
Crude oil futures slightly rebounded from the previous session's lows. Oil prices ended lower on Wednesday after the PMI figures from Europe and US indicate economic slowdowns. The upside momentum gained after the EIA reported a bigger-than-expected rise in U.S. crude supplies. The EIA inventory data showed that US crude inventories fell by 6.1 million barrels last week, much larger than forecasts for a 2.8-million-barrel drop.
CURRENCIES
In the currency market, the euro recovered more than half of the losses against the US dollar. On Wednesday, Euro plunged to a fresh 2-month low of 1.0805 against the US dollar driven by the soft PMI data from the. Moving ahead, the key data for the Euro for the rest of this week will once again be the GDP data from Germany and ECB President Christine Lagarde’s speech. The US dollar movement will continue to play a vital role in this currency pair's future direction.
GOLD
The precious metal made an impressive comeback on Wednesday as the Treasury yields fell sharply after weak US PMI data raised hopes the Fed would end its tightening campaign to avert a recession. Considering the strong pullback, the metal trades flat on Thursday morning. Therefore, the outlook of the metal is neutral with a bullish bias. More upsides will be confirmed only if it moves above $1930.
Economic Outlook
On the data front, the latest PMI data showed that US business activity nearly stagnated in August. The manufacturing indicator fell to 47.0 points, while the services indicator retreated to 51.0. The US Composite PMI index, which tracks manufacturing and service sectors, fell to 50.4 in August from 52 in July. On the other hand, new home sales in the U.S. increased in July, indicating homebuilders benefit from the shortage of second-hand houses.
Moving ahead today, the important events to watch:
US – Durable goods orders: GMT – 12:30
US – Jobless claims: GMT – 12:30
Technical Outlook and Review
EURUSD: The recent movement is sharp but still above the psycological support of 1.0800, which for now does not mean a downward movement but only a correction. Only a break and close below 1.0750 will give a more significant signal and amplify negative sentiment. In the short term, we may see a further potential push down towards the 1.0830/20 area.
The important levels to watch for today: Support- 1.0830 and 1.0800 Resistance- 1.0870 and 1.0900.
GOLD: The metal remains above $1920 but upward momentum is not strong in the last 4 hours. The price actions appear to be part of a consolidation phase and the metal is likely to trade sideways today. On the downside, $1914 will act as an initial cushion, in case it breaks below this level, it will head towards the next support level which is located near $1908 then the key zone near $1900.
The important levels to watch for today: Support- 1914 and 1900 Resistance- 1926 and 1930.
Quote of the day – “Throughout my financial career, I have continually witnessed examples of other people that I have known being ruined by a failure to respect risk. If you don’t take a hard look at risk, it will take you.” — Larry Hite.
Read more - https://gulfbrokers.com/en/daily-market-report-709
Looking ahead, it seems safe to assume that movement in the greenback will remain highly volatile. For today, the dollar traders and investors also should closely monitor the release of July Durable Goods Orders and weekly Initial Jobless Claims data. However, the key speech from Fed Chair Powell Friday at the annual Jackson Hole Symposium will be crucial to watch, his comments could determine the next move for the king dollar.
From a technical perspective, immediate support for DXY is expected at the 103 area, with this zone having been held recently. In contrast, further down, demand is also expected around 102.70, which will act as the next support area. On the flip side, 104/104.10 remains the key supply area to focus on.
EQUITIES
European and UK shares opened higher while US stock futures struggled to extend the upside momentum as investors cautiously awaited Federal Reserve Chair Jerome Powell’s speech. Meanwhile, the overall market sentiment was boosted following the release of strong Q2 earnings results from Nvidia and its upbeat guidance. The chipmaker’s shares surged as much as 10% in aftermarket trading after the company’s latest earnings and forecast beat estimates.
OIL
Crude oil futures slightly rebounded from the previous session's lows. Oil prices ended lower on Wednesday after the PMI figures from Europe and US indicate economic slowdowns. The upside momentum gained after the EIA reported a bigger-than-expected rise in U.S. crude supplies. The EIA inventory data showed that US crude inventories fell by 6.1 million barrels last week, much larger than forecasts for a 2.8-million-barrel drop.
CURRENCIES
In the currency market, the euro recovered more than half of the losses against the US dollar. On Wednesday, Euro plunged to a fresh 2-month low of 1.0805 against the US dollar driven by the soft PMI data from the. Moving ahead, the key data for the Euro for the rest of this week will once again be the GDP data from Germany and ECB President Christine Lagarde’s speech. The US dollar movement will continue to play a vital role in this currency pair's future direction.
GOLD
The precious metal made an impressive comeback on Wednesday as the Treasury yields fell sharply after weak US PMI data raised hopes the Fed would end its tightening campaign to avert a recession. Considering the strong pullback, the metal trades flat on Thursday morning. Therefore, the outlook of the metal is neutral with a bullish bias. More upsides will be confirmed only if it moves above $1930.
Economic Outlook
On the data front, the latest PMI data showed that US business activity nearly stagnated in August. The manufacturing indicator fell to 47.0 points, while the services indicator retreated to 51.0. The US Composite PMI index, which tracks manufacturing and service sectors, fell to 50.4 in August from 52 in July. On the other hand, new home sales in the U.S. increased in July, indicating homebuilders benefit from the shortage of second-hand houses.
Moving ahead today, the important events to watch:
US – Durable goods orders: GMT – 12:30
US – Jobless claims: GMT – 12:30
Technical Outlook and Review
EURUSD: The recent movement is sharp but still above the psycological support of 1.0800, which for now does not mean a downward movement but only a correction. Only a break and close below 1.0750 will give a more significant signal and amplify negative sentiment. In the short term, we may see a further potential push down towards the 1.0830/20 area.
The important levels to watch for today: Support- 1.0830 and 1.0800 Resistance- 1.0870 and 1.0900.
GOLD: The metal remains above $1920 but upward momentum is not strong in the last 4 hours. The price actions appear to be part of a consolidation phase and the metal is likely to trade sideways today. On the downside, $1914 will act as an initial cushion, in case it breaks below this level, it will head towards the next support level which is located near $1908 then the key zone near $1900.
The important levels to watch for today: Support- 1914 and 1900 Resistance- 1926 and 1930.
Quote of the day – “Throughout my financial career, I have continually witnessed examples of other people that I have known being ruined by a failure to respect risk. If you don’t take a hard look at risk, it will take you.” — Larry Hite.
Read more - https://gulfbrokers.com/en/daily-market-report-709
