Daily Market Report - Tuesday, Aug 08, 2023


The euro reversed from the early gains and fell against all its major developed-market peers after the latest German inflation data showed more signs of slowing inflation, easing pressure on the European Central Bank to keep raising interest rates. The CPI data showed the annual inflation rate in Germany dropped to 6.2% in July, down from 6.4% in the previous month.

During the last ECB meeting, ECB President Christine Lagarde declined to say whether the central bank would be hiking or holding rates stable in the future, insisting that the bank would remain data dependent in its future decisions. Lagarde also that the ECB will continue monitoring the relevant inflation data in the months leading up to its September meeting.


Wall Street ended higher on Monday and US major indices recouped some of the declines of the previous week's losses after a series of corporate earnings reports better-than-expected quarterly results. But the momentum slowly faded during the early Asian session on Tuesday following the release of weak economic data from China.

On the earnings front, Rivian, AMC, Upstart and Twilio are amongst those reporting the last quarter's financial results today.


Crude oil futures decline as China trade data disappoint and add to growth concerns. The world's biggest crude importer, China’s imports and exports fell much faster than expected and trade activity slumps to levels once seen before in 2020. Moving ahead, oil investors should closely monitor the release of weekly US inventory data from the American Petroleum Institute and the US Energy Information Administration.


In the currency market, the US Dollar Index, which measures the greenback’s value against the basket of six major currencies regained strong upside momentum, lifted by Fed Governor Michele Bowman's hawkish stance. Fed futures currently price a 13% chance for an additional 25bps hike at Sept 20th's meeting. For today the dollar traders should closely monitor the release of US trade balance data and Fed members Harker and Barkin's statements.


The precious metal struggling to recover and continues to face challenges in gaining momentum. As of this writing, the metal sitting near the 3-week lows. The bearish sentiment was fueled on Tuesday Morning after the hawkish comments from Atlanta Fed Governor Michelle Bowman. He said that additional rate hikes may be necessary to bring inflation back to target levels.

Economic Outlook

On the data front, China’s exports, and imports both posted double-digit declines in July. The country’s exports dropped 14.5% year-on-year in July, while imports contracted 12.4%. The fall in exports was the fastest since the start of the pandemic in early 2020.

Technical Outlook and Review

EURUSD retreats back to below 1.0970 and upward momentum is not strong. The price actions appear to be part of a consolidation phase. The pair needs to stay above 1.1010; otherwise. 1.0940 and 1.0910/00 may be visible soon. On the flip side, in case the euro manages to break above 1.1040, we can expect a strong bullish move to 1.1100 and 1.1150.

The important levels to watch for today: Support- 1.0940 and 1.0910 Resistance- 1.1010 and 1.1040.

GOLD: Technically the overall trend still looks bearish, and the next immediate support is 1926/25 then 1918.

The important levels to watch for today: Support- 1928 and 1922 Resistance- 1940 and 1946.

Quote of the day I always laugh at people who say, “I’ve never met a rich technician.” I love that! It’s such an arrogant, nonsensical response. I used fundamentals for nine years and got rich as a technician. – Marty Schwartz.
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