Weekly review: Gold, USD, EURUSD and Dow Jones


Global stocks and precious metals started the new week mixed as investors continued to bet on further Federal Reserve tightening to bring decades-high inflation under control after the latest economic releases from the US showed the US GDP growth exceeded expectations and durable goods orders hit a two-year high.

The main event on the calendar for monetary policy this week is the meeting of the Reserve Bank of Australia on Tuesday and the Bank of England on Thursday. On the other hand, the markets have a lot of economic data to digest this week which includes the Eurozone inflation and GDP, which will be reported on Monday. US ISM manufacturing PMI will be released on Tuesday. The ADP private sector employment report and ISM services PMI are due on Wednesday and Thursday, respectively. However, Friday’s July Non-farm payrolls (NFP) report is expected to be the week’s most closely watched economic release.

On the earnings front, the companies scheduled to release their last quarter financial results this week will be Apple, Amazon, AMD, Pfizer, Moderna, Uber, Robinhood, Coinbase, Starbucks, Shopify and Pinterest.


The precious metal remains undecided as to which way its next directional break will be. Last week, the metal bounced a fresh weekly high to near $1982 after the FED meeting but the metal failed to extend the upside momentum due to concerns over further US interest rate hikes following higher-than-expected U.S. GDP and Jobless claims data. The US employment report is the key release this week for gold. However, traders will also be watching the latest US ISM manufacturing PMI data set to be released on Tuesday.

This week, if the metal stays above 1960, then the next short-term resistance is located in the area of 1974, a break above 1974 will confirm a possible move to 1988/93. On the downside, a breakdown through 1940 would negate that bias and suggest a test of the 1932 and then 1926 support regions.


The dollar index turned bullish again at the end of last week after we saw strong bearish sentiment in the first 3 days of the week. From Thursday, the index regained strong upside momentum following the release of upbeat US economic data. Considering the last two weeks momentum the index can surely rebound in the short term if market sentiment stabilises. This week's main attraction for the USD is the US ADP and NFP employment reports.

This week, the index needs to stay above 102 to have a chance to develop upside momentum in the near term. If the price breaks and closes above 102, the next upside level to watch is 102.40 then 102.70. On the downside, if the DXY breaks below the previous week's low of 100.90 the next immediate downside area is to watch 100.60 and 100.30/20.


The currency pair slipped to a 2-week low of 1.0940 after the European Central bank did not provide any guidance on its next moves, but raised the possibility of a potential pause in September. The sustainability of any gain in the currency pair in the coming days will largely depend on how the US dollar behaves and key macroeconomic releases from the Eurozone and Germany. Moving ahead, this week all eyes will be turning to the Eurozone inflation data which will give us the latest insight into whether inflation continues to rise further upside.

For this week, the key support level is located below the previous week's low 1.0940. In case it breaks below this level, it will head towards the next support level which is located near 1.0900 then 1.0870. On the upper side, 1.1080 will act as an immediate and strong hurdle while 1.1120 will be a critical resistance zone because above this, bulls are likely to dominate.


Dow Jones ended last week essentially flat after trading in a very tight range. This week, the US ISM PMI and jobs numbers will likely have a significant effect on the Dow Jones. On the other hand, with the big tech firms reporting this week, investors will be hoping their earnings can help boost the markets.

Technically the overall momentum remained bullish over the last few weeks. On the bullish side, this week the resistance stays above 35,700, and a break above this exposes the index to the 36,000/50 level. On the flip side, rejection and pullback from the 35,700 resistance allow for a dip towards 35,180 and with 35,000 and 34,850 forming additional downside targets.

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