Markets were seen rallying modestly after days of uncertainty. The US dollar extended declines for a second consecutive day. The trade gap narrowed in July on the back of weakness in the manufacturing sector. The data underlined the slowing trend among investments in the US. Trade deficit in goods and services fell 2.7% on the month. Traders will be looking at todays private payroll figures.
The euro currency logged gains on Wednesday as the US dollar turned weaker. Economic data from theeurozonecomprised of the retail sales report. Retail sales fell 0.6% on the month in August, matching estimates. Previous months data was revised higher to show a 1.2% increase.ECBchief in waiting, Christine Lagarde gave her speech where she pledged to review the ECBs monetary policies.
The modest rally in the currency pair saw the euro testing the previously breached support level of 1.1030. It is possible forEURUSDto consolidate sideways. But this is subject to the resistance level holding up. But for the moment, the declines look to be done. Unless the common currency extends losses below the previously established lows, we expect to see a sideways range.
Rapid developments from the UK on the political front saw the sterling logging gains. The British PM Boris Johnson was met with resistance as lawmakers scramble to block a no-deal Brexit. This is positive for the pound sterling traders as it lowers the odds of a hard Brexit. Lawmakers are also floating the idea of extending theBrexitdeadline to January 31st. The news sent GBP to post gains for a second day after slipping to historic lows briefly on Tuesday.
Price action in the currency pair currently shows a hidden bearish divergence. The Stochastics oscillator forms a higher high against a lower high in price. This could result in prices snapping back. GBPUSD can test the lower support at 1.2082 in the near term. If the declines stall at this support, there is scope forGBPUSDto maintain the upside bias.
The precious metal was trading flat near six-year highs on Wednesday. Improving investor sentiment saw the safe-haven staying muted. The positive reaction came amid receding tensions in Hong Kong. But the China and US trade narrative still remains in the background. However, the lack of new remarks or policies from either side gave room for investors to take on more risk.
Price action in XAU/USD could remain in a holding pattern ahead of key economic releases today. The ADP private payrolls report is due and could be a precursor to Fridays jobs report. The fact that gold prices are trading near 1544 level indicates that this could turn into resistance in the short term.
This market forecast is for general information only. It is not an investment advice or a solution to buy or sell securities.
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EUR/USD is trading off the two-year lows around 1.0950. US Durable Goods Orders fell short of expectations in total while other figures were mixed. Core Earlier, several EU figures disappointed. End-of-quarter moves are in play.
GBP/USD is trading above 1.23amid mostly disappointing US data. Earlier, BOE member Michael Saunders said the bank may cut interest rates as the next move. EU-UK talks are ongoing in Brussels.
US Dollar Index looks to post highest weekly close in more than two years. Trump is reportedly considering the option to delist Chinese companies from stock markets.
10-year United States (US) Treasury bond yield erases Fridays recovery gains.
Thursday saw cryptos in the red at the close of the European session. The drop ledBitcointo shed the significant support line at$7,850. This point was the optimal long entry price, with an economic stop level.
Gold continued losing ground through the early North-American session, farther below the key $1500 psychological mark, and dropped to 1-1/2 week lows in the last hour.
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