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수요일, 7월 28, 2021

The FOMC kept the monetary policy unchanged on Wednesday. Analysts at Wells Fargo, look for Federal Reserve officials to begin dropping hints in the n

The FOMC kept the monetary policy unchanged on Wednesday. Analysts at Wells Fargo, look for Federal Reserve officials to begin dropping hints in the next month or two about an eventual tapering of asset purchases. They expect a formal announcement at the December FOMC meeting. Key Quotes:  “The FOMC acknowledged that "progress" has been made toward reaching the Committee's goals of maximum employment and price stability. But probably not enough progress yet to warrant a near-term commencement of tapering asset purchases.” “It does not seem that the FOMC is in any hurry to taper, although the Committee does seem to acknowledge that the time is drawing nearer.” “We look for the FOMC to make a formal announcement regarding the tapering of its asset purchases at the December 14-15 meeting, and we expect that the Fed will begin the process of winding down its purchases early next year. But before that formal announcement is made, we expect that Fed officials will hint that tapering will be forthcoming.” “The minutes of today's meeting are scheduled to be published on August 18. We will be reading those minutes closely for any explicit references to the timing of tapering.” “We continue to forecast that the FOMC will keep its target range for the fed funds rate unchanged through at least the end of next year.”

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Cha

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is delivering his comments on the policy outlook. Key quotes "Higher capital requirements are a good thing." "Really just a handful of things account for the overshoot on inflation." "Those factors don't carry long-run implications for inflation or the economy." "Reopening of US economy will take some time, will be very uneven." "A number of Fed participants raised questions about MBS and tapering." "Treasuries and MBS affect financial conditions in similar ways." "There is little support for tapering MBS earlier than Treasuries." "I think we will taper both at the same time." About Jerome Powell (via Federalreserve.gov) Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.

The EUR/USD reversed from 1.1771 and jumped to 1.1842, reaching the highest level since July 15. So far, the euro is facing resistance around the 1.18

US dollar reveres and drops across the board during Powell’s press conference.EUR/USD from a fresh daily low to two-week highs.The EUR/USD reversed from 1.1771 and jumped to 1.1842, reaching the highest level since July 15. So far, the euro is facing resistance around the 1.1840 area as market participants digest the FOMC meeting and Powell’s press conference. The bias in EUR/USD points to the upside. Above 1.1850 the upside could gain momentum. On the flip side, 1.1770 is the key short-term support that if broken would expose the July low at 1.1750. Fed sees progress but not yet there The Federal Reserve kept interest rates and the QE program unchanged as expected. It announced that established two standing repurchase-agreement facilities that will work “as backstops in money markets to support the effective implementation of monetary policy and smooth market functioning.” "The economy has made progress toward goals since setting the bar for taper in December and will continue to assess progress in coming meetings", said the Fed. During the press conference, Powell mentioned "the labor market has a ways to go." His comments favored the reversal of the US dollar across the board and boosted only modestly equity prices. Among majors, the greenback is only up for the day versus the yen and the kiwi. The euro, despite the rally versus the dollar, is down against the Swiss franc with EUR/CHF trading at the lowest since January below 1.0800. Technical levels  

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Cha

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is delivering his comments on the policy outlook. Key quotes "Fed has not made any decisions about the timing of taper." "There is a range of views on FOMC on when tapering is appropriate." "Today's meeting was first deep dive on timing, pace and composition of taper, no decisions made." "In the process of writing Jackson Hole speech but would not want to say what will be in it yet." About Jerome Powell (via Federalreserve.gov) Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Cha

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is delivering his comments on the policy outlook. Key quotes "Factors holding people back from work include fear of covid, caretaker needs and generous unemployment benefits." "All of those factors show wane and mean strong job creation moving forward." "We hear from businesses all over the country that it's very hard to hire people." "People have learned to live with covid." "Industries have also adapted to handle covid." "Last winter's big covid wave did have employment impact but effects of delta this winter will probably be less." "Easy to imagine that some people might wait longer until going back to work, particularly if schools delay re-opening." "It does not seem though that the economic effects of delta will be very large." About Jerome Powell (via Federalreserve.gov) Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.

Russia Unemployment Rate below expectations (5%) in June: Actual (4.8%)

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Cha

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is delivering his comments on the policy outlook. Key quotes "No consensus on what explains moves in bond markets." "Don't see in bond market moves anything that challenges the credibility of the framework." "Fed is monitoring inflation very carefully." "Fed thinks it will make good progress over the next couple of years towards maximum employment." "Clearly on a path to a very strong labor market." "It is not timely to think about raising interest rates right now, Fed looking at asset purchases instead." "Ideally, you would not raise rates before you taper." About Jerome Powell (via Federalreserve.gov) Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.

GBP/USD is trading near 1.3900 during the conclusion of the two-day Federal Open Market Committee meeting with what appears to be some 'temporary' US

GBP/USD is holding bid around comments from Fed's chair Powell despite the Fed's hawkish hold statement. Powell is speaking the US economic recovery higher, supporting prospects for tapering, yet the dollar is softer.GBP/USD is trading near 1.3900 during the conclusion of the two-day Federal Open Market Committee meeting with what appears to be some 'temporary' US dollar weakness playing out. The statement has been released and Fed's chairman, Jerome Powell is currently speaking at a press conference.  This event was widely seen as a placeholder meeting and the market's expectations have been widely met, so far.  The market was looking for a modestly hawkish hold which is what the statement and press event, so far, has offered.  Consequently, the markets are holding in a tight familiar range as the expectations of the acknowledgements of inflation risks, risks of the delta variant and discussions of tapering all came to pass. The statement that the "conomy has made progress toward goals since setting the bar for taper in December and will continue to assess progress in coming meetings," should be received well by the US dollar bulls.  FOMC Statement comparison The changes that do stand out in the statement are as follows:  1. The FOMC removed this entire line: "Progress on vaccinations has reduced the spread of COVID-19 in the United States". 2. An addition, "Not fully recovered". 3. The Fed "made progress" towards taper goals. The following highlights the changes between the Jun 16, 2021 and Jul 28, 2021 FOMC meetings:(Source: TD Securities)Markets are now hinging on the words of the Fed's chair, Jerome Powell in the Press conference which has started.  Watch Powell Presser Live Key comments so far ''We are still a ways off from considering raising interest rates.''   ''In near-term, risks to inflation are to the upside.''
''Has confidence in medium-term inflation will move back down.'' Powell speech: Delta variant may weigh on return to labor market Powell speech: There is no numerical threshold currently for maximum employment Powell speech: Committee discussed how asset purchases might be changed Powell speech: Inflation could turn out to be higher, more persistent than expected Powell speech: The labor market has a ways to go The reaction to these comments in the US dollar are in contrast to the bond market's, so the moves to the downside in the greenback may only be a temporary knee jerk reaction.  DXY 15-min chart GBP/USD & US dollar technical analysis Firstly, the US dollar should be analysed for a broad picture and the price has been tinkering on the edge of critical trendline support which is coming under pressure during the presser as follows: This is a bullish backdrop for cable: With that being said, there are prospects of a retest of the critical support block below from a daily perspective if the greenback turns around over the month-end:

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Cha

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is delivering his comments on the policy outlook. Key quotes "Still a ways away from considering raising interest rates." "Inflation overshoot can still be tied to a handful of categories." "In the near term, risks to inflation to the upside." "Have confidence inflation will move back down in the medium term." "Difficult to tell when inflation will move down, the fed will act if it persistently, materially remains above goal." About Jerome Powell (via Federalreserve.gov) Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Cha

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is delivering his comments on the policy outlook. Key quotes "It is clear that inflation will be running at 2% for months ahead." "Fed is in the process at coming meetings to assess the economy's progress, will give additional clarity on thinking." "There is still some ground to cover to reach substantial further progress." "Delta variant will have health consequences but recent waves have shown less economic implications." "Waiting to see if this is also the case with delta variant, is a reasonable expectation." "Delta may weigh on return to the labor market, we are monitoring it carefully." About Jerome Powell (via Federalreserve.gov) Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Cha

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is delivering his comments on the policy outlook. Key quotes "There is no numerical threshold currently for maximum employment." "Still some ground to cover on labor market side." "I'd say we have some ground to cover on the labor market side on substantial further progress." "Inflation is running well above our target." About Jerome Powell (via Federalreserve.gov) Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Cha

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is delivering his comments on the policy outlook. Key quotes "Our new framework emphasises the importance of well-anchored inflation expectations, they appear broadly consistent with our goal." "If the path of inflation move materially and persistently beyond the goal, Fed is prepared to adjust policy." "Continued progress on vaccinations would support the return to more normal economic conditions." "Fed continued to assess progress toward taper goals and considered pace and composition of taper when it begins." "Committee discussed how asset purchases might be changed." "Fed expects the economy will continue to move towards substantial further progress." "Timing of taper will depend on incoming data." "Will provide advance notice before any change." About Jerome Powell (via Federalreserve.gov) Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Cha

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is delivering his comments on the policy outlook. Key quotes "Inflation has increased notably and will remain elevated in coming months before moderating." "Supply bottlenecks have been larger than anticipated." "Inflation still expected to lower to longer-run goal." "Inflation could turn out to be higher, more persistent than expected." About Jerome Powell (via Federalreserve.gov) Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Cha

Following the Federal Open Market Committee's (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is delivering his comments on the policy outlook. Key quotes "Progress on vaccinations, fiscal support providing strong support to economy." "Household spending is rising at especially rapid pace." "Housing sector remains very strong, business investment rising at solid pace." "Conditions in labor market have continued to improve." "The labor market has a ways to go." "Pandemic factors appear to be weighing on employment growth, but should wane in coming months." About Jerome Powell (via Federalreserve.gov) Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.

The AUD/USD tumbled to 0.7316 following the release of the FOMC statement and later started to recover, rising above the level it had before. The pair

Fed sees some progress, keeps policy unchanged; Powell holds press conference.US dollar rises, then reverses; AUD/USD at the same level it had before the statement.The AUD/USD tumbled to 0.7316 following the release of the FOMC statement and later started to recover, rising above the level it had before. The pair is hovering around 0.7350, down for the day but off weekly lows. The initial reaction in AUD/USD was completely reversed. So far, the US dollar is moving without a clear direction. US stocks are moving modestly to the upside and also US yields. Fed holds but sees some progress The Federal Reserve as expected, kept interest rates unchanged and also the asset purchase program. The FOMC mentioned the labor market and inflation have made progress toward preconditions for tapping their support to the economy. "Economy has made progress toward goals since setting the bar for taper in December and will continue to assess progress in coming meetings", said the Fed. The US central bank also announced that it established two standing repurchase-agreement facilities that will work “as backstops in money markets to support the effective implementation of monetary policy and smooth market functioning.” The dollar rose immediately after the statement but then gave up all the gain and even dropped below previous levels. Chair Powell will hold a press conference. Technical levels  

The two-day Federal Open Market Committee meeting has drawn to a close this afternoon and the statement has been released. This event was widely seen

Gold prices are steady at critical daily support post-Fed statement.A benign statement has left markets at a standstill, awaiting Fed's chair presser. The two-day Federal Open Market Committee meeting has drawn to a close this afternoon and the statement has been released.  This event was widely seen as a placeholder meeting by the Fed and the market's expectation was for a modestly hawkish hold which is what the statement has offered.  There were expectations of the acknowledgements of inflation risks, risks of the delta variant and discussions of tapering which is what we have from the statement. Markets are now hinging on the words of the Fed's chair, Jerome Powell in the Press conference.  FOMC Statement comparison The changes that do stand out in the statement are as follows:  1. The FOMC removed this entire line: "Progress on vaccinations has reduced the spread of COVID-19 in the United States". 2. An addition, "Not fully recovered". 3. The Fed "made progress" towards taper goals. The price of gold is being pressured as the US dollar rallies to test daily and 4-hour resistances.  Gold 15-min chart A drop and pop back to the start again.  Fed statement, key takeaways Benchmark interest rate unchanged; target range stands at 0.00% - 0.25% . The interest rate on excess reserves is unchanged at 0.15%. Fed announces the launch of the standing repo facility. Fed says vaccination progress likely to continue to reduce effects of public health crisis on economy, but risks to the economic outlook remain. Watch Powell Presser Live   Gold & US dollar technical analysis Prior to the event, the US dollar was looking into the abyss at trendline support as follows: The 4-hour structure shows that the price has been reinforced to the downside by two levels of resistance structure.  The most key was the higher level of resistance as this was the apex of the correction that met daily lows and the neckline of the M-formation as follows: Live market, post-Fed statement 15-min chart Pop and a drop, back to the start again.  4-hour chart Meanwhile, for gold, the weekly chart was compelling and a prospect for a downside extension has been building over a number of weeks as follows: Gold weekly chart Daily chart support However, the daily support has been a firm roadblock for the bears into the Fed event and we see little movement so far. 

The EUR/USD dropped from 1.1810 to 1.1771 following the release of the FOMC statement. The US dollar rose across the board after the meeting. Now atte

Fed leaves rates unchanged, eyes turn to Powell’s press conference.EUR/USD falls to 1.1770 as the US dollar rises across the board.The EUR/USD dropped from 1.1810 to 1.1771 following the release of the FOMC statement. The US dollar rose across the board after the meeting. Now attention turns to the press conference. Fed fuels the US dollar before Powell The Federal Reserve left interest rates and the QE program unchanged. It announced the establishment of a domestic standing repo facility (SRF) and a repo facility for foreign and international monetary authorities (FIMA repo facility). So far, market participants see the meeting as tilted to the hawkish side. US yield rose modestly and equity prices remained steady. The US gained momentum and rose across the board at a modest pace. The EUR/USD dropped to as low as 1.1770. Below that level attention would turn to the recent lows around 1.1750. On the upside, a rebound could face immediate resistance at 1.1815 and then comes the weekly top at 1.1840. Technical levels  

United States Fed Interest Rate Decision meets forecasts (0.25%)

The Federal Open Market Committee (FOMC) announced on Wednesday that it left the benchmark interest rate, the target range for federal funds, unchange

The Federal Open Market Committee (FOMC) announced on Wednesday that it left the benchmark interest rate, the target range for federal funds, unchanged at 0%-0.25% as widely expected. In its policy statement, the Fed reaffirmed its commitment to using the full range of tools to continue to support the economy.Follow our live coverage of the FOMC decision and the market reaction. 

West Texas Intermediate (WTI) crude is higher on the day following data showed US crude inventories fell more sharply than analysts had forecast. At t

Oil prices are bid ahead of the Fed on-demand expectations. The focus is back on tight supplies rather than rising coronavirus infections.West Texas Intermediate (WTI) crude is higher on the day following data showed US crude inventories fell more sharply than analysts had forecast. At the time of writing, WTI is trading at $72.48 and up over 0.8% after climbing from a low of $71.73 and reaching a high of $72.57.  The focus on Wednesday is on tight supplies rather than rising coronavirus infections. Crude inventories fell by 4.1 million barrels in the week to July 23, the US Energy Information Administration said Wednesday. Gasoline and distillate fuel stocks also dropped.  The data follows the prior day's American Petroleum Institute (API) which had little initial impact on the market: Crude -4.728M.  Cushing -0.126M.  Gasoline -6.226M. Distillate -1.882M. Meanwhile, the spread of the delta variant, despite vaccination programs, had capped progress in rising prices,  and while it remains a concern, the market is taking the view that demand will outstrip supply.  ''While the delta-variant continues to spread in the US, it is unlikely to meaningfully tighten mobility restrictions and derail the recovery in energy demand,'' analysts at TD Securities explained.  Equally, although the Organization of the Petroleum Exporting Countries and allies, known as OPEC+ have agreed to increase supply by 400,000 barrels per day from August, this is seen as too low. ''OPEC's cautious output deal will continue to underwhelm the recovery in energy demand,'' the analysts at TD Securities argued.  Meanwhile, the focus is on the statement from the US Federal Reserve policy meeting due at 1800 GMT and the Fed's chair, Jerome Powell, shortly afterwards. Oil prices could be affected by the outcome of the event from the impact on the US dollar, for which oil is predominately priced, US stocks, the Fed's view on the economy, the delta variant and the possibility of a timetable for tapering.  WTI technical analysis In yesterday's chart analysis, above, it was noted that the price was supported by the 23.6% Fibonacci retracement of the current daily impulse near 70.50. It was stated that the bulls can target the 78.6% Fibonacci retracement of the prior bearing impulse that has a confluence with the 13 July lows at 73.13.  Progress: With all that being said, the Fed could throw a spanner in the works and send the US dollar flying high on an uber hawkish twist, such as mentioning a time frame for tapering within the statement itself.  DXY daily chart If the bulls go in for a harder test of the resistance near 92.80, then oil could come under pressure. This could negatively impact risk appetite and result in a deeper correction to test the bullish commitments at the 38.2% Fibo near 69.50 and below the psychological 70 level.  On the other hand, the dollar is ripe for a downside extension given that the resistance has already been tested and held.  A break of the trendline resistance would be a significant development in the greenback and likely point to lower lows for the near term. DXY, 4-hour chart

Jerome Powell, Chairman of the Federal Reserve System, will be delivering his remarks on the monetary policy outlook at a press conference following t

Jerome Powell, Chairman of the Federal Reserve System, will be delivering his remarks on the monetary policy outlook at a press conference following the meeting of the Board of Governors. Powell's speech will start at 18:30 GMT.Follow our live coverage of the Fed's policy announcements and the market reaction.Related articlesFederal Reserve Preview: Three reasons why Powell could pause, pummeling the dollar.Fed Interest Rate Decision Preview: The horns of an inflation dilemma.About Jerome Powell (via Federalreserve.gov) Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System's principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.

Arizona Senator Krysten Sinema, who is the lead Democratic negotiator on the infrastructure bill, said on Wednesday that they have reached a deal, as

Arizona Senator Krysten Sinema, who is the lead Democratic negotiator on the infrastructure bill, said on Wednesday that they have reached a deal, as reported by Reuters. "Vote to proceed on the bill will be Wednesday night," Sinema further noted and added that US President Joe Biden is very excited and he is on board with the deal. Market reaction Thie headline doesn't seem to be having a significant impact on market sentiment. As of writing, the S&P 500 Index was unchanged on the day at 4,400 and the Dow Jones Industrial Average was down 0.25% at 34,969.

The USD/MXN is falling on Wednesday, before the FOMC statement, for the sixth consecutive day. It is hovering below the 19.97 zone that contains the 2

Mexican peso remains among the top performers of the week. USD/MXN testing the 19.95 area, looking at uptrend line.The USD/MXN is falling on Wednesday, before the FOMC statement, for the sixth consecutive day. It is hovering below the 19.97 zone that contains the 20 and 55-day moving average. A daily close around the current level would open the doors for a test of an uptrend line from June lows, currently at 19.88. Price is near strong support areas that could prompt a recovery of the dollar. However, a slide under 19.88 would expose the next support areas at 19.80 and 19.70. Technical indicators point to the downside, particularly if it holds under 19.95. Momentum (daily) is breaking under 100 and the RSI is flat around 50. A recovery above 20.05 would alleviate the bearish pressure while a consolidation north of 20.10 should strengthen the greenback for a test of the 200-day moving average (20.19). USD/MXN daily chart  

Data released on Wednesday showed inflation slowed in Canada in June. The Consumer Price Index rose 3.1% from a year ago, after rising 0.3% during the

Data released on Wednesday showed inflation slowed in Canada in June. The Consumer Price Index rose 3.1% from a year ago, after rising 0.3% during the month (consensus: 0.4%). According to analysts at the National Bank of Canada inflation should be somewhat sticky in the medium-term; they see underlying inflation in the upper limit of the central bank’s target over the next quarters.  Key Quotes: “The inflation print for June surprised a little on the downside, showing a weaker growth than expected. This contrasts with the US were inflation has been outpacing consensus for the past few months. That said, the print for June is likely a better reflection of where the Consumer Price Index currently sits. Recall that in June of last year, inflation had risen a significant 0.7% m/m (seasonally adjusted data) which translated into a negative base effect for this latest report. Notwithstanding this lower annual headline figure, CPI is running at a hot 4.4% annualized rate over the past 3 months.” “While some may point to this latest report as an example that recent inflationary pressures are a transitory phenomenon, we maintain our view that inflation should be somewhat sticky in the medium-term.” “In the long-term, we continue to see this cycle as much more conducive to above-target inflation. Both monetary and fiscal policy are expected to stay very stimulating for some time and protectionism/deglobalization as well as the ecological transition are suggesting a regime change for inflation. In sum, we are still seeing underlying inflation in the upper band of the central bank target range in 2021 and 2022.”
 

The GBP/USD printed a fresh daily low during the American session at 1.3843 and then rebounded rising back to the 1.3870 area, near the level it close

US dollar mixed ahead of Fed’s decision.GBP/USD retreats on Wednesday, still looking bullish.The GBP/USD printed a fresh daily low during the American session at 1.3843 and then rebounded rising back to the 1.3870 area, near the level it closed on Tuesday. Market participants await the outcome of the two-day FOMC meeting. The rally of GBP/USD found resistance at the 1.3900 barrier and pulled back. Despite the bearish correction to 1.3840/45, the short-term bias still point to the upside. The pound needs to break the 1.3900 level to clear the way to more gains. Price action remains limited ahead of the FOMC statement. In Wall Street, stocks area mixed and US yields are modestly higher, offering some support to the greenback. The DXY is up 0.10%, at 92.55. At 18:00 GMT the Federal Reserve will release its statement. No change is expected. The tone of the central bank will be watched closely for clues about the future. Analysts at BBH expect a modestly hawkish hold, “as the Fed is likely to acknowledge ongoing inflation risks and continues with its discussions of tapering.  Tapering could be mentioned in the official statement, which would be a very hawkish surprise.”  There won’t be new macroeconomic forecasts.  Technical levels  

The US debt limit suspension expires on 1 August. Analysts at Danske Bank estimate the extraordinary measures are likely exhausted in October or Novem

The US debt limit suspension expires on 1 August. Analysts at Danske Bank estimate the extraordinary measures are likely exhausted in October or November, where they expect a re-suspension. They expect limited near-term market impact, but they warn a re-suspension of the debt limit could come in conjunction with the Federal Reserve starting to taper QE and result in tighter USD liquidity conditions during the fourth quarter, which is not fully priced in the market in their view. Key Quotes:  “The US debt limit suspension expires on 1 August. If the debt limit is not increased or resuspended, the US can no longer issue bonds (besides replacing maturing debt) and needs to rely on so-called extraordinary measures to finance deficit. The debt limit issue is not the same thing as a government shutdown, which occurs when there is no budget.” “In the very near-term, a bipartisan deal seems unlikely. There are already discussions about a bipartisan deal on infrastructure but the Republican leadership is upset about the Democrats’ wish to increase spending (and taxes) further focusing on social and health care.” “The debt ceiling issue in the US has become a repeated game; hence, the market is well aware of the dynamics, e.g. the fall and rise in the cash balance and a deal to suspend the ceiling will come eventually. I.e. we do not expect it to be major market mover. That said the timing of the debt ceiling issue in conjunction with the path forward in Fed’s bond purchases is worth keeping in mind.” “We look for Fed to announce and initiate tapering of its bond purchases around the November and December meeting. Hence, there could potentially be two events, which speaks of tighter USD liquidity conditions in Q4 – a solution to the debt ceiling and subsequent rise in the cash balance and tapering of bond purchases.” “The Fed Funds futures curve is slightly inverted in the front out to around the November and December meeting. We interpret this as an expectation in the market of benign USD liquidity conditions until Q4 before they will start to turn less favourable. It fits well with our outlook for both the debt ceiling and tapering.”
 

Crude Oil Stocks Change in the US was -4.1 million barrels in the week ending July 23, the weekly report published by the US Energy Information Admini

Crude Oil Stocks Change in the US was -4.1 million barrels in the week ending July 23, the weekly report published by the US Energy Information Administration (EIA) revealed on Wednesday. Analysts' estimate was for a decrease of 2.9 million barrels. Market reaction This report doesn't seem to be having a noticeable impact on crude oil prices. As of writing, the barrel of West Texas Intermediate was up 0.22% on the day at $72.07. Additional takeaways "Total motor gasoline inventories decreased by 2.3 million barrels last week and are about 0% below the five year average for this time of year." "US crude oil refinery inputs averaged 15.9 million barrels per day during the week ending July 23, 2021." "US crude oil imports averaged 6.5 million barrels per day last week, decreased by 0.6 million barrels per day from the previous week." "Total products supplied over the last four-week period averaged 20.6 million barrels a day, up by 12.6% from the same period last year."

United States EIA Crude Oil Stocks Change below forecasts (-2.928M) in July 23: Actual (-4.089M)

After rising to a daily high of 1.1830, the EUR/USD pair lost its traction in the early American session and was last seen losing 0.2% at 1.1790. DXY

EUR/USD came under modest bearish pressure in the American session.Rising US Treasury bond yields help USD outperform its rivals.FOMC will release its Monetary Policy Statement at 1800 GMT.After rising to a daily high of 1.1830, the EUR/USD pair lost its traction in the early American session and was last seen losing 0.2% at 1.1790. DXY stays in the positive territory above 92.60 The renewed USD strength is in the second half of the day is causing EUR/USD to edge lower. Ahead of the FOMC's policy announcements, recovering US Treasury bond yields are helping the greenback attract investors. Currently, the benchmark 10-year US Treasury bond yield is up 1.1% on the day at 1.2560 and the US Dollar Index (DXY) is up 0.2% at 92.66. The only data from the US showed earlier in the day that the international trade deficit widened to $91.2 billion in June from $89.2 billion in May. Nevertheless, this print failed to trigger a noticeable market reaction. Investors will look for fresh clues regarding the timing of asset tapering in the Fed's Monetary Policy Statement, which will be released at 1800 GMT. Previewing the FOMC's July meeting, FXStreet analyst Yohay Elam said the Fed is expected to hold firm with its bond-buying scheme and push back against any imminent tightening. "The lack of action by the Fed does not mean stability in currency markets – printing more dollars for longer means a weaker greenback," Elam added.Federal Reserve Preview: Three reasons why Powell could pause, pummeling the dollar.Technical levels to watch for  

Major equity indexes in the US opened on a mixed note on Wednesday as investors refrain from taking large positions while waiting for the FOMC to anno

Wall Street's main indexes trade mixed on Wednesday.S&P 500 Communication Services Index is up more than 1% after the opening bell.Investors await for FOMC to release its Monetary Policy Statement.Major equity indexes in the US opened on a mixed note on Wednesday as investors refrain from taking large positions while waiting for the FOMC to announce its policy decisions following the July meeting. As of writing, the S&P 500 was virtually unchanged on the day 4,400, the Nasdaq Composite was up 0.25% at 15,000 and the Dow Jones Industrial Average was losing 0.18% at 35,062. Among the 11 major S&P 500 sectors, the Communication Services Index is up more than 1% after the opening bell. On the other hand, the Technology Index is losing 0.9%, limiting the tech-heavy Nasdaq's upside.Federal Reserve Preview: Three reasons why Powell could pause, pummeling the dollar.Fed Interest Rate Decision Preview: The horns of an inflation dilemma.S&P 500 chart (daily)

The US Dollar Index (DXY), which tracks the greenback vs. a basket of its main competitors, accelerates gains to the area above 92.60 on Wednesday. US

DXY now moves higher and approaches the 92.70 level.US flash trade balance showed the deficit widened to $91.2 billion.Investors’ attention remains on the FOMC event later on Wednesday.The US Dollar Index (DXY), which tracks the greenback vs. a basket of its main competitors, accelerates gains to the area above 92.60 on Wednesday. US Dollar Index bid ahead of FOMC The index now trades on a firmer note and manages well to reclaim further ground near 92.70 as the FOMC gathering looms closer. Collaborating with the upside momentum in the dollar, yields of the US 10-year benchmark manage to surpass the 1.26% level following recent lows, although the upside stays so far capped by the 1.30% hurdle. In the US calendar, advanced Goods Trade Balance figures showed the trade deficit widened to $91.21 billion during June. Earlier MBA’s Mortgage Applications increased 5.7% on the week finished on July 23. Later, all the attention will be on the FOMC event, where market participants are expected to closely follow any hint of the timing of the QE tapering, inflation prospects and potential earlier-than-anticipated interest rate hikes. US Dollar Index relevant levels Now, the index is gaining 0.20% at 92.65 and a break above 93.19 (monthly high Jul.21) would open the door to 93.43 (2021 high Mar.21) and finally 94.00 (round level). On the other hand, the next down barrier comes in at 92.31 (weekly low Jul.27) followed by 92.00 (monthly low Jul.6) and then 91.51 (weekly low Jun.23).

The NZD/USD pair maintained its offered tone through the early North American session and dropped to fresh one-week lows, around the 0.6925 region in

NZD/USD witnessed some follow-through selling for the second straight session on Wednesday.Rebounding US bond yields, risk-off mood benefitted the safe-haven USD and exerted pressure.Investors keenly await the FOMC monetary policy decision before placing fresh directional bets.The NZD/USD pair maintained its offered tone through the early North American session and dropped to fresh one-week lows, around the 0.6925 region in the last hour. The pair extended the previous day's rejection slide from the key 0.7000 psychological mark and witnessed some follow-through selling for the second successive session on Wednesday. A combination of factors assisted the US dollar to regain positive traction, which, in turn, exerted some downward pressure on the NZD/USD pair. Investors remain worried about the potential economic fallout from the fast-spreading Delta variant of the coronavirus. This was evident from the prevalent cautious mood around the equity markets, which was seen as a key factor that acted as a tailwind for the safe-haven USD and drove some flows away from the perceived riskier kiwi. Apart from this, a goodish pickup in the US Treasury bond yields further underpinned the greenback amid some repositioning trade ahead of the highly-anticipated FOMC monetary policy decision. Given a surprise hawkish shift from the Fed in June, market players will look for fresh clues about the timing of tapering amid surging inflation in the US. The announcement will be followed by the post-meeting press conference, where comments by Fed Chair Jerome Powell will play a key role in influencing the near-term USD price dynamics. This, along with developments surrounding the coronavirus saga, should assist investors to determine the next leg of a directional move for the NZD/USD pair. Technical levels to watch  

After dropping to 1.2560 area during the European trading hours, the USD/CAD pair staged a modest recovery in the early American session. As of writin

USD/CAD continues to fluctuate in a tight range on Wednesday.Annual inflation in Canada softened to 3.1% in June.US Dollar Index holds above 92.60 as focus shifts to FOMC.After dropping to 1.2560 area during the European trading hours, the USD/CAD pair staged a modest recovery in the early American session. As of writing, the pair was trading at 1.2386, still losing 0.12% on a daily basis. Investors ignore Canada CPI data Earlier in the session, the data published by Statistics Canada revealed that inflation, as measured by the Consumer Price Index (CPI), declined to 3.1% in June from 3.6% in May. Additionally, the Bank of Canada's (BoC) Core CPI inched lower to 2.7% on a yearly basis from 2.8%.  Ahead of the FOMC's policy announcements, however, USD/CAD showed little to no reaction to the inflation data. Meanwhile, the US Dollar Index is posting modest daily gains at 92.64, not allowing the pair to turn south. The 1.7% increase seen in the benchmark 10-year US Treasury bond yield on Wednesday seems to be helping the greenback stay resilient against its rivals. Previewing the FOMC's July policy meeting, "tapering is not a question of if, but when – and the timing of the Federal Reserve's announcement to create fewer dollars may have to wait longer," said FXStreet analyst Yohay Elam. "The world's most powerful central bank has been buying bonds at a rate of $120 billion/month for over a year, and economic improvement has implied it could withdraw some support. However, that could take more time, pushing the dollar down and allowing other currencies to rally alongside stock markets." Technical levels to watch for  

Gold refreshed daily lows heading into the North American session, albeit quickly recovered a bit thereafter. Currently hovering around the $1,800 mar

Gold extended its range-bound price action through the early North American session.A goodish pickup in the US bond yields benefitted the USD and capped the early uptick.COVID-19 jitters extended some support to the safe-haven metal ahead of the FOMC.Gold refreshed daily lows heading into the North American session, albeit quickly recovered a bit thereafter. Currently hovering around the $1,800 mark, the XAU/USD struggled to capitalize on its modest intraday gains to the $1,807 area and was capped by a combination of factors. The US dollar was back in demand amid a goodish pickup in the US Treasury bond yields, which, in turn, acted as a headwind for the non-yielding yellow metal. The USD uptick could further be attributed to some repositioning trade ahead of the highly-anticipated FOMC monetary policy decision, scheduled to be announced later during the US session. Market players will look for clues on the timing of tapering amid surging inflation in the US. This will play a key role in influencing the near-term trajectory for the greenback and provided a fresh directional impetus to the dollar-denominated commodity. Meanwhile, investors remain worried about the potential economic fallout from the spread of the highly contagious Delta variant of the coronavirus. This, to a larger extent, helped offset the negative factors and helped limit any meaningful slide for the traditional safe-haven gold. Investors also seemed reluctant heading into the FOMC event risk, warranting some caution before placing any aggressive directional bets. Even from a technical perspective, the XAU/USD has been oscillating in a familiar trading range over the past one week or so. The downside remains cushioned near the $1,790 horizontal support, which should now act as a pivotal point for short-term traders. Given the recent failure near the very important 200-day SMA, a convincing break below might trigger some technical selling and pave the way for some near-term depreciating move. On the upside, the $1,808-10 region now seems to have emerged as immediate strong resistance. A sustained strength beyond is likely to push spot prices back closer to the 200-day SMA, currently around the $1,822-23 region. Some follow-through buying will be seen as a fresh trigger for bullish traders and pave the way for a move towards monthly swing highs, around the $1,834 area, en-route the next relevant hurdle near the $1,850-52 zone.

Bloomberg News Congress correspondent Erik Wasson tweeted out on Wednesday that comments from both parties suggest that there could come an agreement

Bloomberg News Congress correspondent Erik Wasson tweeted out on Wednesday that comments from both parties suggest that there could come an agreement on the infrastructure bill later in the day. Reporting on the same matter, Washington Post reporter Tony Romm said negotiators are closing on a deal after working late into last night but noted that it could be finalized over the weekend.  Market reaction The market mood remains upbeat following these comments. As of writing, the S&P Futures were up 0.15% on the day and the Nasdaq Futures were rising 0.4%.

EUR/USD came under pressure after recording new weekly highs in the 1.1840/45 band on Tuesday. Spot, in the meantime, flirts with the 2020-2021 line i

EUR/USD leaves behind Tuesday’s advance to 1.1840.The resumption of the downtrend could re-test 1.1750.EUR/USD came under pressure after recording new weekly highs in the 1.1840/45 band on Tuesday. Spot, in the meantime, flirts with the 2020-2021 line in the 1.1785/90 band. A sustainable break below this zone would be an important bearish event and carries the potential to accelerate losses. Initial support comes in at the Fibo level at 1.1764 followed by monthly lows around 1.1750 and then the YTD low in the 1.1700 neighbourhood (March 31). Further out, the near-term outlook for EUR/USD is seen on the negative side while below the key 200-day SMA, today at 1.2003. EUR/USD daily chart  

Canada Consumer Price Index - Core (MoM) declined to 0.3% in June from previous 0.4%

The advanced data published by the US Census Bureau revealed on Wednesday that the international trade deficit increased by $3 billion in June to $91.

US international trade deficit US continued to expand in June.US Dollar Index stays in the positive territory above 92.60.The advanced data published by the US Census Bureau revealed on Wednesday that the international trade deficit increased by $3 billion in June to $91.2 billion from $88.2 billion in May. "Exports of goods for June were $145.5 billion, $0.5 billion more than May exports," the publication further read. "Imports of goods for June were $236.7 billion, $3.5 billion more than May imports." Market reaction This report doesn't seem to be having a noticeable impact on the USD's performance against its rivals. As of writing, the US Dollar Index was up 0.18% on the day at 92.63.

Annual inflation in Canada, as measured by the Consumer Price Index (CPI), declined to 3.1% in June from 3.6% in May, the data published by Statistics

Annual inflation in Canada softened modestly in June.USD/CAD stays in the negative territory below 1.2600.Annual inflation in Canada, as measured by the Consumer Price Index (CPI), declined to 3.1% in June from 3.6% in May, the data published by Statistics Canada revealed on Wednesday. This reading came in lower than the market expectation of 3.2%. On a monthly basis, the CPI edged lower to 0.3% from 0.5% in May. Moreover, the Bank of Canada's (BoC) Core CPI, which excludes volatile food and energy prices, arrived at 2.7%, compared to analysts' estimate of 2.4%. Market reaction The USD/CAD pair inched higher after this report and was last seen posting small daily losses at 1.2584.

Canada BoC Consumer Price Index Core (MoM) below expectations (0.4%) in June: Actual (0.3%)

Canada BoC Consumer Price Index Core (YoY) came in at 2.7%, above expectations (2.4%) in June

United States Wholesale Inventories: 0.8% (June) vs previous 1.3%

Canada Consumer Price Index (MoM) came in at 0.3% below forecasts (0.4%) in June

Canada Consumer Price Index (YoY) came in at 3.1%, below expectations (3.2%) in June

United States Goods Trade Balance declined to $-91.2B in June from previous $-89.2B

The USD/CHF pair traded with a mild positive bias, around mid-0.9100s heading into the North American session, albeit lacked any strong follow-through

USD/CHF gained some positive traction on Wednesday amid a modest USD strength.A goodish pickup in the US bond yields underpinned the USD and remained supportive.The risk-off mood might benefit the safe-haven CHF and cap gains ahead of the FOMC.The USD/CHF pair traded with a mild positive bias, around mid-0.9100s heading into the North American session, albeit lacked any strong follow-through buying. Having found some support near the 0.9130-25 region, the USD/CHF pair edged higher on Wednesday and for now, seems to have snapped two consecutive days of the losing streak. The US dollar was back in demand amid a goodish pickup in the US Treasury bond yields. This, in turn, was seen as a key factor that acted as a tailwind for the major. However, the prevalent risk-off mood benefitted the safe-haven Swiss franc and capped the upside for the USD/CHF pair. Investors remain worried about the economic fallout from the spread of the highly contagious Delta variant of the coronavirus. This, along with China's regulatory crackdown, took its toll on the global risk sentiment. Apart from this, investors also seemed reluctant to place any aggressive bets, rather preferred to wait on the sidelines ahead of the highly-anticipated FOMC monetary policy decision. Market players will look for a clear answer to the crucial question of when the tapering will begin, which, in turn, will influence the greenback. In the meantime, the US bond yields will play a key role in driving the USD and provide some trading impetus to the USD/CHF pair. Apart from this, traders will further take cues from the broader market risk sentiment to grab some short-term opportunities around the major. Technical levels to watch  

DXY leaves the recent weakness and manages to post decent gains in the 92.50/60 region on Wednesday. Further rangebound around current levels is likel

DXY regains the smile and the 92.50 region pre-FOMC.Extra decline could see 92.30 re-visited.DXY leaves the recent weakness and manages to post decent gains in the 92.50/60 region on Wednesday. Further rangebound around current levels is likely ahead of the key FOMC event later on Wednesday. On the upside, there is an interim hurdle at the monthly tops near 93.20 (July 21) ahead of the 2021 high in the mid-93.00s, while weekly lows in the 92.30 area (July 27) should offer interim support. In the meantime, and looking at the broader scenario, the positive stance on the dollar is expected to remain unchanged as long as the index trades above the 200-day SMA, today at 91.35. DXY daily chart  

EUR/JPY keeps the consolidative mood unchanged around the 130.00 area for yet another session. Extra consolidation appears on the cards in the very ne

EUR/JPY extends the choppy activity around 130.00 so far this week.The mid-128.00s should hold the initial test if the downside picks up pace.EUR/JPY keeps the consolidative mood unchanged around the 130.00 area for yet another session. Extra consolidation appears on the cards in the very near term ahead of the FOMC event. On the downside, decent contention is located in the 128.50 region, which is also reinforced by a Fibo level (128.54) and the 200-day SMA (128.53). In the meantime, while above the 200-day SMA at 128.53, the outlook for EUR/JPY is expected to remain constructive. EUR/JPY daily chart  

Pfizer's Research and Development Chief says they continue to believe it is likely that a third dose booster may be needed within six to 12 months aft

Pfizer's Research and Development Chief says they continue to believe it is likely that a third dose booster may be needed within six to 12 months after full COVID-19 vaccination, Reuters reported on Wednesday, citing prepared remarks. Additional takeaways "Anticipating emergency use authorization submission for COVID-19 vaccine booster as early as August." "In ongoing discussions with regulatory agencies regarding potential third dose booster of current COVID-19 vaccine." "Planning to start immunogenicity and safety study in August to evaluate updated version of COVID-19 vaccine designed to target the delta variant." "Projecting potential US emergency use authorization submission for oral COVID-19 anti-viral in Q4." "Expecting to have safety & immunogenicity data to support US emergency use authorization for use in children ages 5 to 11 years old by end of September." Market reaction These comments don't seem to be having a significant impact on market sentiment. As of writing, S&P Futures were flat on the day at 4,394.

The USD/CAD pair continued with its struggle to find acceptance/build on the momentum beyond the 1.2600 mark and faced rejection near the very importa

USD/CAD faced rejection near 200-day SMA and edged lower on Wednesday.The set-up still favours bulls and supports prospects for a break to the upside.Sustained weakness below 1.2500 is needed to negate the positive outlook.The USD/CAD pair continued with its struggle to find acceptance/build on the momentum beyond the 1.2600 mark and faced rejection near the very important 200-day SMA on Wednesday. The pair dropped to fresh daily lows, around the 1.2560 region and has now reversed a part of the previous day's positive move. A modest uptick in crude oil prices underpinned the commodity-linked loonie and turned out to be one of the key factors that acted as a headwind for the USD/CAD pair. That said, renewed buying interest around the US dollar should help limit any meaningful pullback for the major, at least for the time being. The prevalent risk-off environment continued benefitting the safe-haven greenback, which was further supported by a goodish pickup in the US Treasury bond yields. Apart from this, traders might also be reluctant to place any aggressive bets ahead of the Canadian CPI report and the FOMC monetary policy decision. Looking at the technical picture, the USD/CAD pair has been oscillating in a range over the past one week or so. The top boundary of the trading band coincides with 200-day SMA and should act as a key pivotal point for short-term traders. A sustained strength beyond will set the stage for additional gains. Meanwhile, technical indicators on the daily chart – though have corrected from higher levels – are still holding comfortably in the bullish territory. This, in turn, supports prospects for the emergence of some dip-buying at lower levels. Hence, any subsequent fall might still be seen as a buying opportunity. From current levels, the 1.2525 horizontal zone should protect the immediate downside ahead of the 1.2500 psychological mark. A convincing break below might shift the bias in favour of bearish traders. The USD/CAD pair might then turn vulnerable and accelerate the slide to the next relevant support near the 1.2435 region. On the flip side, some follow-through buying beyond the 1.2600 mark will be seen as a fresh trigger for bulls and lift the USD/CAD pair towards the 1.2665-70 intermediate hurdle. The momentum could further get extended towards the 1.2700 mark before bulls eventually push the pair to the 1.2770-75 resistance zone. USD/CAD 4-hour chart Technical levels to watch  

The USD/JPY pair started the week on the back for and closed the first two days in the negative territory, losing 80 pips during that time span. On We

USD/JPY is edging higher following a two-day slide.10-year US Treasury bond yield is up nearly 1% on Wednesday.US Dollar Index stays in the positive territory ahead of FOMC's policy announcements.The USD/JPY pair started the week on the back for and closed the first two days in the negative territory, losing 80 pips during that time span. On Wednesday, however, the pair managed to stage a rebound and was last seen gaining 0.3% on the day at 110.09. USD stays resilient against its rivals on Wednesday The sharp decline witnessed in the US Treasury bond yields and the broad-based USD weakness weighed on USD/JPY on Monday and Tuesday. Pressured by the safe-haven flows, the benchmark 10-year US T-bond yield fell more than 4% on Tuesday and the US Dollar Index (DXY) dropped to a 12-day low of 92.31. Ahead of the FOMC's monetary policy announcements, the 10-year US T-bond yield is up nearly 1% and the DXY stays in the positive territory, helping USD/JPY edge higher. Earlier in the day, the Bank of Japan reiterated in its Summary of Opinions that it remains important not to tighten the monetary policy prematurely. "In Japan's economy, downward pressure on consumption is likely to intensify in the short run due to the reinstatement of the state of emergency," the publication further read.  Previewing the FOMC's July policy meeting, "FOMC Chairman Jerome Powell is highly unlikely to reveal or even expound on any of Fed's considerations or plans on Wednesday afternoon," said FXStreet senior analyst Joseph Trevisani. "That will not, of course, stop the markets from running with a perception. The Fed does not intend to relent on its policy accommodation."Fed Interest Rate Decision Preview: The horns of an inflation dilemma.Technical levels to watch for  

In opinion of Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, the downtrend in EUR/CHF could be in its final stage. Key Quotes

In opinion of Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, the downtrend in EUR/CHF could be in its final stage. Key Quotes “EUR/CHF is grinding lower but the recent low at 1.0798 has again not been confirmed by the daily RSI, and while we suspect this may be the end stage of the down move, but for now the market continues to weigh on the downside near term. Nearby resistance is seen at the June low at 1.0872 and also at the May 11 and 24 lows at 1.0925/27.” “Failure at 1.0800, on a closing, would target 1.0739, the 2021 low. The 1.0736 December low is regarded as the break down point to the 1.0629 November low.”

Economist at UOB Group Ho Woei Chen, CFA, comments on the latest GDP figures in South Korea. Key Takeaways “South Korea’s 2Q21 GDP was marginally belo

Economist at UOB Group Ho Woei Chen, CFA, comments on the latest GDP figures in South Korea. Key Takeaways “South Korea’s 2Q21 GDP was marginally below consensus expectations at 5.9% y/y, 0.7% q/q seasonally-adjusted (Bloomberg est: 6.0% y/y, 0.8% s/a q/q; UOB est: 5.6% y/y, 0.4% q/q). Nonetheless, the noticeable pick-up in private consumption in 2Q21 (3.6% y/y, 3.5% q/q) pointed to further broadening out of the economic growth drivers but it should also be noted this was before the spike in COVID-19 infections in early-July and new daily cases have remained above 1,000 since then.” “On a q/q seasonally-adjusted basis, GDP expanded for the fourth straight quarter, by 0.7% in 2Q21 compared to 1.7% in 1Q21. This was led by private and government consumption at 3.5% q/q and 3.9% q/q from 1.2% and 1.6% respectively in 1Q21.” “While there are downside risks to South Korea’s outlook from its worst COVID-19 infection wave, we maintain our full-year 2021 GDP growth forecast of 3.7% for now, taking into account the economic recovery so far as well as the fiscal support measures including the second supplementary budget announced in July that is worth KRW33.0 trillion (1.7% of GDP) as well as possible extension of its COVID-19 loan and interest payment deferral program that will expire in September.”

McDonald's (MCD) reported Q2 earnings before the market opened on Wednesday. Earnings Per Share came in at $2.37 versus the average Wall Street estima

McDonald's (MCD) reported Q2 earnings before the market opened on Wednesday. Earnings Per Share came in at $2.37 versus the average Wall Street estimate of $2.08. Revenue came in at $5.89 billion versus the estimate of $5.53 billion by Wall Street analysts.   McDonald's (MCD) stock forecast McDonald's stock is trading at $246.40 in Wednesday's premarket trading, a change of  0.02%. McDonald's shares closed Tuesday's regular session at $246.35 a gain of 0.97% on Tuesday.

Pfizer (PFE) reported Q2 2021 earnings on Wednesday, July 28 before the market opened. Pfizer reported Earnings Per Share (EPS) of $1.07 versus the a

Pfizer (PFE) reported Q2 2021 earnings on Wednesday, July 28 before the market opened. Pfizer reported Earnings Per Share (EPS) of $1.07 versus the average Wall Street analyst estimate of $0.96. Revenue was $19 billion versus the average analyst estimate of $18.45 billion. Pfizer also raised its full-year guidance from $70.5-72.5 billion to $78-80 billion and raises full-year EPS guidance from $3.55-3.65 to $3.95-4.05 range.  Pfizer raised sales forecasts for sales of the Covid-19 vaccine to $33.5 billion from $26 billion. Pfizer stock forecast Pfizer (PFE) stock is trading at $42.40 in Wednesday's premarket, a change of 0.7% . Pfizer closed Tuesday's regular session at $42.10, a change of +0.69% on Tuesday.

United States MBA Mortgage Applications: 5.7% (July 23) vs -4%

The AUD/USD pair rose to a daily high of 0.7376 during the Asian trading hours but lost its traction in the European session. As of writing, the pair

AUD/USD is edging lower for the second straight day.US Dollar Index stays relatively calm around 92.50 on Wedensday.FOMC will release its Monetary Policy Statement at 1800 GMT.The AUD/USD pair rose to a daily high of 0.7376 during the Asian trading hours but lost its traction in the European session. As of writing, the pair was losing 0.25% on the day at 0.7340. Focus shifts to FOMC meeting Earlier in the day, the data published by the Australian Bureau of Statistics showed that the Consumer Price Index (CPI) rose to 0.8% in the second quarter from 0.6%. This reading came in slightly higher than the market expectation of 0.7%. Additionally, the Reserve Bank of Australia's (RBA) Trimmed Mean CPI increased to 1.6% on a yearly basis in Q2 and matched analysts' estimates. Although Australian inflation figures helped the AUD find some demand, AUD/USD failed to preserve its bullish momentum ahead of the FOMC's policy announcements. In the meantime, the US Dollar Index, which closed the first two days of the week in the negative territory, is holding above 92.50 on Wednesday, forcing AUD/USD to stay in the red. Previewing the FOMC's July policy meeting, "the Fed is set to hold firm with its bond-buying scheme and push back against any imminent tightening," said FXStreet analyst Yohay Elam. "The lack of action by the Fed does not mean stability in currency markets – printing more dollars for longer means a weaker greenback."Federal Reserve Preview: Three reasons why Powell could pause, pummeling the dollar.Technical levels to watch for  

The GBP/JPY cross maintained its bid tone through the first half of the European session and shot to near two-week tops, just above mid-152.00s in the

A combination of factors assisted GBP/JPY to regain positive traction on Wednesday.A declining trend in Delta variant infections in the UK underpinned the British pound.The worsening COVID-19 situation in Japan weighed on the JPY amid signs of stability.The GBP/JPY cross maintained its bid tone through the first half of the European session and shot to near two-week tops, just above mid-152.00s in the last hour. Following the previous day's modest pullback, the GBP/JPY cross caught some fresh bids on Wednesday and built on its recent strong rebound from the 148.45 region, or the lowest level since March. In the absence of any negative Brexit-related headlines, the British pound remained well supported by the declining trend in Delta variant infections. In fact, new COVID-19 cases in Britain declined for the seventh consecutive day on Tuesday. Adding to this, UK’s top epidemiologist Neil Ferguson has said that the end of the pandemic in Britain could be just months away. This, in turn, was seen as a key factor that acted as a tailwind for the sterling and continued pushing the GBP/JPY cross higher. On the other hand, the worsening COVID-19 situation in Japan, along with signs of stability in the equity markets, undermined the safe-haven Japanese yen and provided an additional boost to the GBP/JPY cross. In the latest developments, Japan reportedly mulls a state of emergency for Tokyo neighbouring prefectures amid record new cases on Wednesday. The fundamental backdrop favours bullish traders amid absent relevant market moving economic releases. That said, it will still be prudent to wait for some strong follow-through buying before positioning for any further appreciating move towards the 154.00 mark. The momentum could eventually lift the GBP/JPY cross further towards the key 155.00 psychological mark. Technical levels to watch  

Ireland Retail Sales (YoY) declined to 10.6% in June from previous 44%

Ireland Retail Sales (MoM) up to 3.3% in June from previous 1.8%

Silver traded with a mild positive bias through the first half of the European session and was last seen hovering near daily tops, around the $24.80-8

Silver edged higher on Wednesday and recovered a part of the overnight losses.The near-term technical bias remains tilted firmly in favour of bearish traders.Any subsequent move up is more likely to remain capped near the $25.00 mark.Silver traded with a mild positive bias through the first half of the European session and was last seen hovering near daily tops, around the $24.80-85 region. The uptick assisted the commodity to recover a part of the previous day's losses to near four-month lows. From a technical perspective, the overnight slide confirmed a near-term bearish breakdown through a three-day-old trading range. Subsequent weakness below the previous monthly swing lows, around the $24.75 region, supports prospects for an extension of the recent leg down. However, overstretched RSI (14) on the 1-hour chart prompted some short-covering move on Wednesday. That said, technical indicators on 4-hour/daily charts are still far from being in the oversold territory and add credence to the near-term bearish outlook for the XAG/USD. Hence, any subsequent positive move might still be seen as a selling opportunity near the trading range support breakpoint, around the key $25.00 psychological mark. This, in turn, should keep a lid on any meaningful upside for the XAG/USD near the $25.40 heavy supply zone. On the flip side, the overnight swing lows, around mid-$24.00s might act as immediate support. Some follow-through selling should turn the XAG/USD vulnerable to accelerate the downfall further towards the $24.00 round-figure mark en-route YTD lows, around the $23.80-75 region. Silver 1-hour chart Technical levels to watch  

The Reserve Bank of New Zealand (RBNZ) is likely to kick off its rate hiking cycle from August, then hike again in November and take its official cash

The Reserve Bank of New Zealand (RBNZ) is likely to kick off its rate hiking cycle from August, then hike again in November and take its official cash rate (OCR) to 2% or more by the third quarter of 2022, MNI reported, citing comments from the former RBNZ Assistant Governor Grant Spencer. Additional takeaways “The speed of the NZ economy's rebound has been a surprise and it was now overheating.” "We also have very strong demand pushing restricted supply.” “Inflation pressures will continue to be robust because of New Zealand's continued isolation as a result of the pandemic.” On interest rates, there was a "real risk of getting behind the curve" if the bank did not hike rates in August. "The sensible thing to do would be to have a one-notch increase at the next meeting because they will try for a soft landing and that will require an incremental approach.” “A stronger New Zealand dollar was another risk to the economy as it would impact negatively on the terms of trade.” “The RBNZ would soon end its Funding for Lending program, which has offered a cheap funding source for commercial banks.” "If they remove it there may be some upward pressure on bank funding costs. A soft landing for the rampant property market was another challenge for the RBNZ.” "There is a risk of house price reductions, but I don't see a collapse, and without tightening that would increase the risk of a hard landing in that market."

Having faced rejection at the $15 mark earlier this week, USD/ZAR remains in the red zone for the third straight session on Wednesday, looking vulnera

USD/ZAR remains in the red for the third day in a row. The 4H chart shows a potential symmetrical triangle breakdown. RSI has flipped bearish, backing the downside bias in the pair.Having faced rejection at the $15 mark earlier this week, USD/ZAR remains in the red zone for the third straight session on Wednesday, looking vulnerable to additional declines. The currency pair appears to ignore the broad rebound in the US dollar across the board, as technical indicators scream sell. As observed on USD/ZAR’s four-hour chart, the cross is on the verge of confirming a symmetrical triangle breakdown if the bears yield a sustained closing below the rising trendline support at 14.77. If the downside breakout gets confirmed, then a drop towards the upward-sloping 50-Simple Moving Average (SMA) at 14.67 cannot be ruled out. Additional losses could see the 100-SMA support at 14.55 come into play. The Relative Strength Index (RSI) has pierced through the midline from above, reviving the bearish interests. USD/ZAR four-hourly chart However, should the bulls manage to defend the abovementioned triangle support a retest of the 21-SMA at 14.82 could be next in the pipeline for the optimists. Acceptance above the latter could trigger a sharp rally towards the falling trendline resistance at 14.92. All in all, the path of least resistance appears to the downside for USD/ZAR.

Gold prices face prospects of extra gains if $1,834.16 is cleared, suggested Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank. K

Gold prices face prospects of extra gains if $1,834.16 is cleared, suggested Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank. Key Quotes “Gold is holding steady just above the 1791.45 12th July low. It really needs to overcome the 1834.16 mid-July high to regenerate upside interest and at currently levels we are relatively neutral.” “The daily Elliott wave count remains negative and below 1790 will target the 1752 2019-2021 uptrend line.” “While above there we will retain our longer term upside bias, however the lack of a sustained bounce is worrying. Above 1834.16 lies the 1857.25 4 th June low. This guards the June high at 1916.91 and Fibo at 1921.” “Longer term we still target the 1959/65 November 2020 high and the 2021 high. These guard the 1989/78.6% retracement and the 2072 2020 peak.” “The 78.6% retracement lies at 1728.90 and only below here will target the 1677.73/1676.80 lows seen in March.”

The GBP/USD pair traded with a mild positive bias through the first half of the European session, with bulls still awaiting a sustained move beyond th

GBP/USD was seen consolidating its recent strong gains to near two-week tops.A declining trend in Delta variant infections in the UK underpinned the sterling.A modest USD strength capped any further gains ahead of the FOMC decision.The GBP/USD pair traded with a mild positive bias through the first half of the European session, with bulls still awaiting a sustained move beyond the 1.3900 mark. A combination of diverging forces failed to provide any meaningful impetus to the GBP/USD pair and capped the upside just ahead of the 1.3900 round-figure mark. The US dollar found some support on Wednesday amid a modest pickup in the US Treasury bond yields and the prevalent risk-off environment. This was seen as a key factor that acted as a headwind for the major. The GBP/USD pair, for now, seems to have stalled its upward trajectory, though the bias seems tilted in favour of bulls in the absence of any Brexit-related headlines. The British pound was supported by the declining trend in Delta variant infections and comments by the UK’s top epidemiologist, Neil Ferguson, saying that the end of the pandemic could be just months away. On the other hand, expectations that the Fed will stick to its dovish stance might hold the USD bulls from placing any aggressive bets and help limit any downside for the GBP/USD pair. Hence, the spotlight will remain on the outcome of a two-day FOMC monetary policy meeting. The Fed is scheduled to announce its decision later during the US session this Wednesday. Market participants will look for a clear answer to the crucial question of when the tapering will begin. This will play a key role in influencing the near-term USD price dynamics. Traders might further take cues from developments surrounding the coronavirus saga and the broader market risk sentiment to grab some short-term opportunities around the GBP/USD pair. Technical levels to watch  

Economist at UOB Group Enrico Tanuwidjaja and Haris Handy assess the latest FDI figures in the Indonesian economy during the second quarter. Key Quote

Economist at UOB Group Enrico Tanuwidjaja and Haris Handy assess the latest FDI figures in the Indonesian economy during the second quarter. Key Quotes “Indonesia’s direct investment rose by 16.2% y/y in April – June 2021 period vs. 4.3% in the previous quarter, underpinned by the positive performance of both, foreign direct investment (FDI) and domestic direct investment (DDI).” “Singapore remained as the largest foreign investor in Indonesia, with investment valued at USD 2.1bn for 3,821 projects, followed by Hong Kong at USD 1.4bn for 615 projects.” ‘By sector, housing-industrial-estate-and-office-building were the largest recipients of DDI in 2Q21, valued at IDR 20.5tr (USD 1.4bn). Meanwhile, metal (except machinery and equipment) was the leading sector for FDI at USD 1.8bn.”

“The Fed meeting tonight will likely not lead to a decision on tapering, but a lot of technical issues are on the table, which makes the meeting super

“The Fed meeting tonight will likely not lead to a decision on tapering, but a lot of technical issues are on the table, which makes the meeting super interesting anyway. Here is what to watch,” notes Andreas Steno Larsen, Chief Global FX/FI Strategist at Nordea. Key quotes“On USD liquidity: Liquidity has already effectively peaked as the 5 bps hike to the ON RRP facility incentivized further usage of the facility. We may be in for an additional 200bn USD in liquidity added from the drawdown of the TGA (US Treasury is forced to spend cash from the liquidity buffer due to the debt ceiling) just this week.”“On the Fed funds rate: The effective fed funds rate prints at 10 bps, which is still 2.5 bps below the mid-point, so there is absolutely no reason to think that the Fed regrets hiking the ON RPP and IOER rates by 5 bps before summer.”“On QE: The Fed has recently started “stealth-twisting” it’s QE program with an increasing WAM of the SOMA-portfolio. The increasing WAM of the SOMA-portfolio could be an early sign that the Fed intends to maturity-sugarcoat a tapering process that arrives EARLIER than anticipated.”“On inflation: It is still fairly easy for Powell to explain most of the recent inflation surge away as transitory since it is driven by only a few components such as used cars (due to chip shortage), transport costs (a re-opening base-effect) and energy prices. Expect the word "bottle-neck" to be used a lot tonight.”Related readsFed Interest Rate Decision Preview: The horns of an inflation dilemma

The single currency adds to the weekly recovery vs. the dollar and motivates EUR/USD to extend the recent breakout of the 1.1800 mark on Wednesday. EU

EUR/USD trades in a narrow range above the 1.1800 level.Germany’s GfK Consumer Confidence surprised to the downside.All the attention will be on the FOMC gathering later in the session.The single currency adds to the weekly recovery vs. the dollar and motivates EUR/USD to extend the recent breakout of the 1.1800 mark on Wednesday. EUR/USD stays vigilant ahead of the FOMC event EUR/USD sees its recent upside momentum renewed in response to the inconclusive/cautious stance in the dollar, which prompts some volatility in the US Dollar Index (DXY). The pair is seen alternating gains with losses so far on Wednesday ahead of the key FOMC meeting due later in the NA trading hours. The broad consensus among investors favours the current status quo from the Committee, although any mention of the potential timing of the QE tapering, views on the current high inflation and prospects of rate hikes sooner than expected are likely to take centre stage. In the domestic calendar, GfK noted the German Consumer Confidence stayed unchanged at -0.3 in August, coming in short of estimates. In France and Italy, the same gauge eased to 101 and improved to 116.6, respectively, for the month of July. Later in the US data space and other than the FOMC event, Mortgage Applications, Trade Balance figures and the EIA’s report are also due. What to look for around EUR The recovery in EUR/USD met a tough barrier in the low-1.1800s for the time being, coming back from last week’s lows in the 1.1750 zone. As usual in past weeks, price action around the pair is expected to exclusively hinge on dollar dynamics, with the FOMC meeting on Wednesday gathering special attention. On the euro side of the equation, the re-affirmed dovish stance from the ECB (as per its latest meeting) is expected to keep the upside limited in spot despite auspicious results from key fundamentals and the persistent high morale in the region.Key events in the euro area this week: German GfK Consumer Confidence (Wednesday) – German labour market report/Advanced July CPI, EMU final Consumer Confidence (Thursday) – German, EMU flash Q2 GDP/EMU advanced July CPI (Friday).Eminent issues on the back boiler: Asymmetric economic recovery in the region. Sustainability of the pick-up in inflation figures. Progress of the Delta variant of the coronavirus and pace of the vaccination campaign. Probable political effervescence around the EU Recovery Fund. German elections. Investors’ shift to European equities in the wake of the pandemic. EUR/USD levels to watch So far, spot is up 0.09% at 1.1827 and faces the next up barrier at 1.1841 (weekly high Jul.27) followed by 1.1895 (weekly high Jul.6) and finally 1.1975 (weekly high Jun.25). On the other hand, a breakdown of 1.1751 (monthly low Jul.21) would target 1.1704 (2021 low Mar.31) en route to 1.1602 (November 2020 low).

USD/CAD is extending its choppy trading into the European session, having failed to find acceptance above 1.2600 heading into the Canadian CPI and Fed

USD/CAD returns to the red below 1.2600 despite DXY rebound. Firmer WTI prices weigh on the spot amid risk recovery.  200-DMA continues to cap the upside ahead key event risks. USD/CAD is extending its choppy trading into the European session, having failed to find acceptance above 1.2600 heading into the Canadian CPI and Fed monetary policy decision. The major remains pressured despite the rebound in the US dollar alongside the Treasury yields, as a recovery in the risk appetite amid strong European earnings reports diminishes the safe-haven appeal of the US bonds. The downside pressure in the spot could be attributed to higher WTI prices, as expectations of tighter supplies counter covid fears. Further, chart-based selling also appears to be another catalyst behind USD/CAD’s weakness, especially after the 200-Daily Moving Average (DMA) at 1.2603 continues to limit the bullish potential. Despite the recent leg lower, the currency pair extends its range play between 1.2525-1.2610 levels into the fifth straight session on Wednesday, awaiting a breakout in either direction depending on the Fed outcome. The Fed is widely expected to maintain its monetary policy settings, although any hints on the taper timing could be a big market mover, impacting the US dollar valuations significantly. Also, of note remains the Canadian Consumer Price Index (CPI) data, with the Bank of Canada (BOC) core CPI figure expected to ease to 2.4% in June vs. May’s 2.8%. USD/CAD: Technical levels “From a technical perspective, the overnight positive move stalled near the very important 200-day SMA. The mentioned barrier is pegged near the 1.2605 region, which should now act as a key pivotal point for short-term traders. A sustained strength beyond will set the stage for additional gains and accelerate the move towards the 1.2665-70 horizontal resistance. On the flip side, the 1.2555-50 region now seems to protect the immediate downside ahead of the 1.2525 horizontal zone,” FXStreet’s Analyst, Haresh Menghani explains. USD/CAD: Additional levels  

The NZD/USD pair extended the previous day's rejection slide from the key 0.7000 psychological mark and edged lower for the second consecutive session

NZD/USD witnessed some selling for the second successive session on Wednesday.The risk-off mood benefitted the safe-haven USD and exerted downward pressure.Investors now eye the latest FOMC policy decision for a fresh directional impetus.The NZD/USD pair extended the previous day's rejection slide from the key 0.7000 psychological mark and edged lower for the second consecutive session on Wednesday. The downward trajectory dragged the pair to one-week lows, further below mid-0.6900s during the early European session. Worries about the economic fallout from the fast-spreading Delta variant of the coronavirus, along with China's regulatory crackdown, sent ripples through the global equity markets. The risk-off impulse drove some haven flows towards the US dollar and was seen as a key factor exerting downward pressure on the perceived riskier kiwi. The greenback was further supported by a modest uptick in the US Treasury bond yields, though expectations that the Fed will stick to its dovish stance capped gains. Hence, it will be prudent to wait for some strong follow-through selling before placing fresh bets around the NZD/USD pair and an extension of the ongoing downfall. The Fed is scheduled to announce its policy decision at the conclusion of a two-day meeting later during the US session. Market participants will look for a clear answer to the crucial question of when the tapering will begin. This will influence the near-term USD price dynamics and provide a fresh directional impetus to the NZD/USD. Heading into the key event risk, the US bond yields and the broader market risk sentiment will drive the greenback amid absent relevant market moving economic releases. This, in turn, should allow traders to grab some short-term opportunities around the NZD/USD pair. Technical levels to watch  

According to Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, EUR/GBP remains under pressure and could grind lower in the short

According to Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, EUR/GBP remains under pressure and could grind lower in the short-term horizon. Key Quotes “No change. EUR/GBP is under pressure in its range and near term risks are on the downside. Support lies at the .8503 recent low and then the .8471 long term pivot. Initial resistance is the 55-day ma at .8586 ahead of stronger resistance at .8673, the 25th May high.”

The positive momentum in USD/CNH could extend to the 6.5500 level and beyond in the next weeks, commented UOB Group’s FX Strategists. Key Quotes 24-ho

The positive momentum in USD/CNH could extend to the 6.5500 level and beyond in the next weeks, commented UOB Group’s FX Strategists. Key Quotes 24-hour view: “We did not anticipate the sudden and impulsive surge in USD that sent it rocketing to a 3-1/2 month high of 6.5289. The outsized and rapid rally appears to be overdone and USD is unlikely to strengthen much further. On the other hand, it is too soon to expect a sizeable pullback. All in, USD is more likely to trade between 6.5000 and 6.5330.” Next 1-3 weeks: “We have expected USD to trade within a 6.4400/6.5000 range since the middle of last week. Yesterday (27 Jul), we highlighted that ‘looking ahead, the upside risk appears to greater but USD has to close above 6.5000 before a sustained advance can be expected’. That said, we did not anticipate the sudden surge in USD during Asian session and the subsequent strong daily closing of +0.71% (its biggest 1-day advance in 9-1/2 months). The strong boost in momentum suggests that USD is likely to strengthen further to 6.5500, possibly 6.5880. The positive outlook for USD is deemed intact as long as USD does not move below the ‘strong support’ level (currently at 6.4820).”

The greenback regains some buying interest and manages to reverse the recent weakness, lifting the US Dollar Index (DXY) back above the 92.50 mark on

DXY reverses the recent decline and retakes 92.50.US 10-year yields rebound past the 1.25% level.The FOMC event will be the salient point in the calendar.The greenback regains some buying interest and manages to reverse the recent weakness, lifting the US Dollar Index (DXY) back above the 92.50 mark on Wednesday. US Dollar Index looks to the Fed After two consecutive daily pullbacks, including Tuesday’s multi-day lows around 92.30, the index embarks on a recovery to the 92.50/60 band following the opening bell in the old continent. The leg higher in the dollar appears sponsored by the bounce in yields of the key US 10-year note to levels beyond 1.25%, all within the multi-session consolidative theme. In the meantime, the cautious stance is poised to prevail among market participants and the dollar in light of the upcoming FOMC event, where QE tapering, inflation, employment and the general performance of the US economy are expected to be in the centre of the debate. Additional data in the US docket include the weekly MBA Mortgage Applications, advanced Goods Trade Balance figures and the EIA’s weekly report on US crude oil supplies. What to look for around USD DXY eased some ground in response to the better mood in the riskier assets. It is worth recalling that despite testing the area above the 93.00 mark in several sessions, the index still failed to close above it on a daily basis. In the very near term, the dollar is expected to move into a consolidative phase as markets get closer to the key FOMC event (Wednesday). In the meantime, bouts of risk aversion in response to coronavirus concerns, the solid pace of the economic recovery, high inflation and prospects of earlier-than-expected QE tapering/rate hikes remain factors supportive of further upside in the dollar.Key events in the US this week: FOMC meeting, Powell’s press conference (Wednesday) – Flash Q2 GDP, Initial Claims, Pending Home Sales (Thursday) – PCE/Core PCE, Personal Income/Spending, Final July Consumer Sentiment (Friday).Eminent issues on the back boiler: Biden’s multi-billion plan to support infrastructure and families. US-China trade conflict under the Biden’s administration. Tapering speculation vs. economic recovery. US real interest rates vs. Europe. Could US fiscal stimulus lead to overheating? US Dollar Index relevant levels Now, the index is gaining 0.11% at 92.57 and a break above 93.19 (monthly high Jul.21) would open the door to 93.43 (2021 high Mar.21) and finally 94.00 (round level). On the other hand, the next down barrier comes in at 92.31 (weekly low Jul.27) followed by 92.00 (monthly low Jul.6) and then 91.51 (weekly low Jun.23).

The EUR/GBP cross dropped to fresh multi-month lows during the early European session, though managed to rebound few pips from the key 0.8500 psycholo

EUR/GBP witnessed some intraday selling on Wednesday and dropped to fresh multi-month lows.A declining trend in Delta variant infections in the UK continued acting as a tailwind for the sterling.A stronger USD capped gains for the British pound and helped limit any further losses for the cross.The EUR/GBP cross dropped to fresh multi-month lows during the early European session, though managed to rebound few pips from the key 0.8500 psychological mark. The cross witnessed some selling during the first half of the trading action on Wednesday and dropped to the lowest level since April 6. The British pound's relative outperformance against its European counterpart could be attributed to the declining trend in Delta variant infections in the UK. In fact, new COVID-19 cases in Britain declined for the seventh consecutive day on Tuesday. Adding to this, UK’s top epidemiologist Neil Ferguson has said that the end of the pandemic in Britain could be just months away. This, in turn, was seen as a key factor that underpinned the sterling. That said, the emergence of some fresh buying around the US dollar held traders from placing fresh bullish bets around the GBP. This, along with slightly oversold conditions on intraday charts, helped limit any further losses for the EUR/GBP cross and assisted bulls to defend the 0.8500 mark. Meanwhile, a stronger USD exerted some downward pressure on the shared currency, which should keep a lid on any meaningful recovery for the EUR/GBP cross. Hence, it will be prudent to wait for some strong follow-through buying before confirming that the cross has bottomed out. There isn't any major market-moving economic data due for release on Wednesday, either from the Eurozone or the UK. Hence, the key focus will remain on the FOMC decision, which might infuse some volatility in the markets and produce some trading opportunities around the EUR/GBP cross. Technical levels to watch  

Switzerland ZEW Survey – Expectations: 42.8 (July) vs previous 51.3

Austria Purchasing Manager Index dipped from previous 67 to 63.9 in July

Italy Consumer Confidence above forecasts (115.5) in July: Actual (116.6)

Italy Business Confidence above forecasts (115.4) in July: Actual (115.7)

In light of the recent price action, USD/CHF could slip back to the 0.9117 level, suggests Karen Jones, Team Head FICC Technical Analysis Research at

In light of the recent price action, USD/CHF could slip back to the 0.9117 level, suggests Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank. Key Quotes “USD/CHF has failed at the 4-month downtrend at .9219 and is under pressure near term. We would allow for slippage back to the .9117 recent low and even the .9100/.9075 55 and 200 day ma. These should hold, and we should eventually see recovery.” “Below the 200 day ma would allow for a slide to the .9054/46 late May and early June highs as well as the early February high and then the 78.6% retracement at .9000. This is the last defence for the .8926/31 May lows.”

USD/JPY is still forecast to maintain the consolidation between the 109.20/110.60 band in the next weeks, commented FX Strategists at UOB Group. Key Q

USD/JPY is still forecast to maintain the consolidation between the 109.20/110.60 band in the next weeks, commented FX Strategists at UOB Group. Key Quotes 24-hour view: “The sharp drop in USD to 109.57 came as a surprise (we were expecting sideway-trading). The rapid decline appears to be overdone and USD is unlikely to weaken much further. For today, USD is more likely to consolidate and trade between 109.50 and 110.10.” Next 1-3 weeks: “On Tuesday (26 Jul, spot at 110.55), we highlighted that ‘upward momentum is beginning to improve but USD has close above 110.90 before a sustained advance can be expected’. We added, ‘the prospect for USD to close above 110.90 is not high for now but it would remain intact as long as USD does not move below 109.90 within these few days’. The build-up in momentum fizzled out quickly as USD dropped sharply to 109.57 yesterday (27 Jul). The recent price actions have resulted in a mixed outlook and USD could trade within a 109.20/110.60 range for now.”

Analysts at Australia and New Zealand Banking Group (ANZ) offer their afterthoughts on the Australian second-quarter CPI release. Key quotes “Headline

Analysts at Australia and New Zealand Banking Group (ANZ) offer their afterthoughts on the Australian second-quarter CPI release. Key quotes “Headline Q2 inflation lifted to a very strong 0.8%, which saw annual headline inflation surge above the RBA’s target band for the first time in a decade. This move is expected to be temporary though, and inflation will soon start to slow over the coming quarters.” “The trimmed mean inflation also lifted, though to a more subdued 0.5% q/q. We expect trimmed mean inflation to return to the target band in H2 2022 and rise from there, triggering cash rate hikes in H2 2023. “  “With the annual figure some way below 2%, the underlying message is that inflation is still a long way from where the RBA wants it to be.”

Sweden Retail Sales (YoY) declined to 8.5% in June from previous 10.3%

Sweden Retail Sales (MoM) fell from previous 2.3% to -0.3% in June

WTI (futures on Nymex) is posting small gains while hovering around the $72 barrier, snapping two straight days of declines. Despite the minor bids, t

WTI is posting small gains around $72 amid pre-Fed market caution. Renewed US dollar buying, covid fears cap the upside.  The US oil draws support from tighter supplies ahead of EIA data.  WTI (futures on Nymex) is posting small gains while hovering around the $72 barrier, snapping two straight days of declines. Despite the minor bids, the pre-Fed decision cautious trading and worries over surging covid cases globally continue to limit the upside attempts in the higher-yielding oil. At the time of writing, the US oil rises 0.50% on the day to trade at $72.03, looking for fresh impetus in order to find acceptance above the latest. While holding at higher levels, the black gold consolidates its staggering recovery from two-month lows of $65.11 reached last week. Expectations of tighter crude supplies continue to offer support to WTI bulls. This comes after the American Petroleum Institute (API) reported a bigger-then-expected draw in the US crude stockpiles. The API report showed that the US crude stocks fell by 4.7 million barrels for the week ended July 23 vs. expectations of a drop of 2.9 million barrels. However, looming worries over the rapid spread of coronavirus and the International Monetary Fund’s (IMF) cutting its growth estimates for Emerging Asia raise concerns over the demand prospects for oil and its products, in turn, weighing on WTI prices. Attention now turns towards the Energy Information Administration (EIA) weekly US crude supplies report and the FOMC decision for fresh trading opportunities in the commodity. The US dollar remains well-bid across its main rivals ahead of the Fed decision. WTI technical levels to consider  

The AUD/USD pair extended its sideways consolidative price action and remained confined in a narrow trading band, around mid-0.7300s heading into the

AUD/USD lacked any firm directional bias and remained confined in a range on Wednesday.A combination of factors extended some support to the USD and capped gains for the major.Bulls shrugged off slightly stronger Australian CPI as the focus remains on FOMC decision.The AUD/USD pair extended its sideways consolidative price action and remained confined in a narrow trading band, around mid-0.7300s heading into the European session. The pair, so far, has been struggling to register any meaningful recovery and oscillating in a range over the past one week or so. Given the recent fall to the lowest level since November 2020, this might still be categorized as a bearish consolidation phase as investors await a fresh catalyst before placing any directional bets. Hence, the key focus will remain on the outcome of a two-day FOMC monetary policy meeting, scheduled to be announced later during the US session. Market participants will look for a clear answer to the crucial question of when the tapering will start, which, in turn, will play a key role in influencing the US dollar in the near term. In the meantime, the shaky risk sentiment extended some support to the safe-haven USD and acted as a headwind for the perceived riskier aussie. Worries about the economic fallout from the fast-spreading Delta variant of the coronavirus, along with China's regulatory crackdown, has sent ripples through the global equity markets. Apart from this, the greenback was further supported by a modest uptick in the US Treasury bond yields. The combination of factors, to a larger extent, offset slightly better-than-expected Australian consumer inflation figures. In fact, the headline CPI rose 0.8% during the second quarter, though did little to impress bullish traders. From a technical perspective, the AUD/USD pair's inability to gain any meaningful traction clearly suggests that the near-term bearish trend might still be far from being over. Hence, any meaningful upside back towards the 0.7400 mark might be seen as a selling opportunity and runs the risk of fizzling out rather quickly. Technical levels to watch  

Here is what you need to know on Wednesday, July 28: Tension is mounting ahead of the Federal Reserve's decision, keeping currencies in range and the

Here is what you need to know on Wednesday, July 28: Tension is mounting ahead of the Federal Reserve's decision, keeping currencies in range and the dollar on the back foot. Concerns about covid in the US and China's techlash are offset by robust earnings by US firms and optimism coming from the UK's falling infections. Cryptocurrencies have been recovering.  The Federal Reserve is set to leave its policy unchanged and provide hints about when it considers tapering down its bond-buying scheme. Rising inflation and an improving labor market provide hope, yet some signs of a slowdown and the spread of the Delta virus are worrying.  Fed Chair Jerome Powell is set to address the press. In his last appearance, he said the conditions for reducing purchases are still "a ways off."  Previews:  Federal Reserve Preview: Three reasons why Powell could pause, pummeling the dollar Fed Interest Rate Decision Preview: The horns of an inflation dilemma The US dollar is trading in a narrow range ahead of the event, typical of such days. The greenback is thus consolidating losses suffered on Tuesday when it edged lower amid falling US Treasury yields and positioning ahead of Wednesday's big event.  The market mood is mixed as Wall Street is mostly pleased with earnings reports from tech giants Microsoft, Apple and Alphabet (Google). In China, authorities are trying to soothe investors after Beijing's "techlash" sent shares tumbling earlier in the week. US coronavirus:The US Center for Disease Control & Prevention (CDC) called on Americans to wear face masks indoors in places with high levels of covid cases, responding to the rapid spread of the Delta strain. The announcement somewhat dampened the mood.  On Tuesday, US data was mostly positive. While Durable Goods Orders for June missed expectations, they came on top of significant upward revision for May, showing that investment is still robust. The data feeds into Thursday's Gross Domestic Product release. The Conference Board's Consumer Confidence gauge beat estimates, contrary to other surveys.  US June Durable Goods: More than meets the eyeEUR/USD is holding above 1.18, little moved by the disappointing drop in Germany's GfK Consumer Climate survey to -0.3.GBP/USD is trading above 1.3850, benefiting from seven consecutive days of falls in COVID-19 infections, a result of restrictions and a high vaccination rate. The effects of Britain's July 19 reopening are yet to be felt. AUD/USD is steady around 0.7350 after Consumer Price Index came out at 0.8% in the second quarter in Australia. Authorities are set to extend lockdowns.USD/CAD is hovering below 1.26 ahead of Canada's release of its inflation figures. WTI Crude Oil is hovering around $72.Bitcoin is trading closer to $40,000 once again, recovering from the fall-related to Amazon's denial it would be accepting cryptocurrencies. Ethereum is somewhat lower, changing hands under $2,300.  See Analyzing inter-market correlations to see if reflation trade is coming to an end – July 2021
 

USD/CAD accumulates losses on Wednesday in the European trading session. The pair opened higher, however, not able to preserve the momentum and retrea

USD/CAD fails to capitalize the previous session’s gains on Wednesday.Bulls face stiff resistance near the 1.2580-1.2620 zone.Momentum oscillator holds onto the oversold zone with negative bias.USD/CAD accumulates losses on Wednesday in the European trading session. The pair opened higher, however, not able to preserve the momentum and retreated towards the lower level. At the time of writing, USD/CAD is trading at 1.2580, down 0.17% for the day. USD/CAD daily chart On the daily chart, the USD/CAD pair has been taking strong support near the 1.2550 level with multiple bottom formations. If price remains below the session low, it could test the previous day’s low at 1.2538 as the first downside target.  The Moving Average Convergence Divergence (MACD) indicator holds over the oversold with bearish crossover. Any downtick in the MACD could intensify the selling pressure toward the 1.2500 horizontal support level. Next, the USD/CAD bears would aim for the 50% Fibonacci retracement, which extends from the low of 1.2129, at 1.2477. Alternatively, if price moves higher then it could be to the 23.6% Fibonacci retracement at 1.2650. A daily close above the mentioned level would prompt bulls to continue with the prevailing upside momentum. The next area of support for the market participant would be the 1.2700 horizontal resistance level followed by the high of July 21 at 1.2730. USD/CAD additional levels
 

Analysts at Danske Bank note that the FOMC decision is the main event risk for Wednesday, adding they expect the Fed to stand pat on its monetary poli

Analysts at Danske Bank note that the FOMC decision is the main event risk for Wednesday, adding they expect the Fed to stand pat on its monetary policy settings. Read: Federal Reserve Preview: Three reasons why Powell could pause, pummeling the dollarKey quotes “Today's main event is the FOMC meeting (announcement 20:00 CEST). It is one of the interim meetings without updated projections (including Fed dots). “ “We do not expect the Fed to send any new policy signals.“ “We expect the Fed to repeat that high inflation is mostly transitory and that the labour market recovery has further to go still. Fed Chair Powell's press conference begins at 20:30 CEST.”

France Consumer Confidence below expectations (102) in July: Actual (101)

Traders scaled back their open interest positions by around 17.5K contracts on Tuesday, the largest single-day drop so far this year, all in light of

Traders scaled back their open interest positions by around 17.5K contracts on Tuesday, the largest single-day drop so far this year, all in light of preliminary readings from CME Group. On the flip side, volume increased for the second consecutive session, this time by almost 7K contracts. Natural gas stays capped around $4.20… for now Prices of natural gas closed with losses on Wednesday for the first time after seven sessions in a row. The downtick came in tandem with shrinking open interest, hinting at the view that a sustained decline is not favoured in the very near term.

GBP/USD has stalled its two-day uptrend, as the sellers continue to lurk just below the 1.3900 level. However, with the UK considering a travel corrid

GBP/USD consolidates before the next push higher. The cable awaits acceptance above 1.3900 to retest 100-DMA.RSI remains bullish, keeping the bulls hopeful ahead of the Fed. GBP/USD has stalled its two-day uptrend, as the sellers continue to lurk just below the 1.3900 level. However, with the UK considering a travel corridor between the US for freer movement and easing Brexit concerns, the GBP traders remain hopeful for another leg higher. Meanwhile, the US dollar holds its recent lower ground heading into the critical Fed decision, awaiting fresh hints on taper timing for the next direction. Looking at the cable technically, the GBP bulls await a firm break above the 1.3900 round number, in order to test the offers at 100-Daily Moving Average (DMA) at 1.3924. Further up, the mildly bearish 50-DMA at 1.3951 could be on the buyers’ radars. The Relative Strength Index (RSI) is in the bullish space, adding credence to a potential move higher. GBP/USD: Daily chart On the flip side, horizontal 21-DMA at 1.3801 will offer strong support on any sustained pullbacks. Ahead of that level, the 1.3850 psychological mark could be probed. If the selling pressure intensifies, a further drop towards the upward-sloping 200-DMA at 1.3726 could be in the offing. GBP/USD: Additional levels  

Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, noted EUR/USD could extend the bounce to the 1.1860/1.1930 zone. Key Quotes “E

Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, noted EUR/USD could extend the bounce to the 1.1860/1.1930 zone. Key Quotes “EUR/USD has eroded its short term downtrend and is upside corrective near term. We would allow for a rebound into the 1.1860/1.1930 band. It will face tougher overhead resistance at 1.1884/82, the highs from last week and the 23.6% retracement and currently we are looking for the 200-day ma at 1.2008 to cap the topside.” “Below 1.1750 attention will revert to the September, November and March lows at 1.1704/1.1600.”

The USD/JPY pair traded with a mild positive bias heading into the European session, albeit lacked any follow-through and remained below the key 110.0

USD/JPY gained traction on Wednesday and recovered a part of the overnight losses.A modest uptick in the US bond yields benefitted the USD and extended some support.The risk-off impulse underpinned the safe-haven JPY and capped gains ahead of FOMC.The USD/JPY pair traded with a mild positive bias heading into the European session, albeit lacked any follow-through and remained below the key 110.00 psychological mark. The pair edged higher on Wednesday and is now looking to build on the overnight modest bounce from one-week lows, or the 100-day SMA support near the 109.60-55 region. A modest uptick in the US Treasury bond yields extended some support to the US dollar. This, in turn, was seen as a key factor that provided a modest lift to the USD/JPY pair. That said, the shaky risk sentiment acted as a tailwind for the safe-haven Japanese yen and capped the upside for the USD/JPY pair. Investors remain worried about the potential economic fallout from the fast-spreading Delta variant of the coronavirus. This, along with China's regulatory crackdown, sent ripples through the global equity markets. Investors also seemed reluctant to place any aggressive bets, rather preferred to wait on the sidelines ahead of the conclusion of a two-day FOMC monetary policy meeting. The Fed is scheduled to announce its decision later during the US session and market participants will look for a clear answer about the crucial question of when the tapering will begin. Nevertheless, the outcome will play a key role in influencing the near-term USD price dynamics and provide a fresh directional impetus to the USD/JPY pair. Heading into the key event risk, the broader market risk sentiment, along with the US bond yields will be looked upon for some short-term trading opportunities amid absent market-moving economic releases. Technical levels to watch  

AUD/USD could now trade within the 0.7320-0.7450 range in the next weeks, suggested FX Strategists at UOB Group. Key Quotes 24-hour view: “Our expecta

AUD/USD could now trade within the 0.7320-0.7450 range in the next weeks, suggested FX Strategists at UOB Group. Key Quotes 24-hour view: “Our expectation for ‘the rebound in AUD to extend to 0.7415’ did not materialize as it traded between within a 0.7338/0.7390 range. The price actions are viewed as part of a consolidation. For today, AUD is likely to trade sideways between 0.7340 and 0.7390.” Next 1-3 weeks: “Our view from last Friday (23 Jul, spot at 0.7385) still stands. As highlighted, AUD could trade between 0.7320 and 0.7450 for period of time. Looking ahead, the downside risk appears to be greater but AUD has to break below last week’s low at 0.7290 before a sustained decline can be expected.”

Open interest in crude oil futures markets rose for yet another session on Tuesday, this time by around 6.7K contracts considering advanced figures fr

Open interest in crude oil futures markets rose for yet another session on Tuesday, this time by around 6.7K contracts considering advanced figures from CME Group. Volume, instead, resumed the downtrend and dropped by more than 58K contracts. WTI faces a moderate barrier around $72.00 Tuesday’s drop and rebound in WTI from the $71.00 region was amidst rising open interest, which leaves the door open to the continuation of the recovery in the very near term from last week’s lows near the $65.00 mark per barrel.

A travel corridor between the UK and US for free movement is being considered, the UK Prime Minister Boris Johnson said in an interview with LBC. He a

A travel corridor between the UK and US for free movement is being considered, the UK Prime Minister Boris Johnson said in an interview with LBC. He added that the UK-US travel corridor will likely allow people to "come freely in a way that they normally do". Britain reported 23,511 new covid cases in the latest 24 hours, according to official figures released on Tuesday. Market reaction GBP/USD caught a fresh bid on the above comments, now heading back towards 1.3900. The spot was last seen trading at 1.3878, modestly flat on the day, bouncing off daily lows at 1.3864.

Cable could edge higher and surpass 1.3900 in the short term, noted FX Strategists at UOB Group. Key Quotes 24-hour view: “We highlighted yesterday th

Cable could edge higher and surpass 1.3900 in the short term, noted FX Strategists at UOB Group. Key Quotes 24-hour view: “We highlighted yesterday that GBP ‘could test 1.3860 first before easing’. We added, ‘the major resistance at 1.3900 is unlikely to be challenged’. While our view for a stronger GBP was not wrong, we did not quite expect the sharp rise to 1.3894. The strong advance could extend above 1.3915 but in view of the overbought conditions, GBP may not be able to maintain a foothold above this level. The next resistance at 1.3955 is unlikely to come into the picture. Support is at 1.3850 followed by 1.3820.” Next 1-3 weeks: “We noted yesterday (27 Jul, spot at 1.3825) that upward momentum has improved and we expected GBP to ‘trade with an upward bias towards 1.3900’. However, we did not quite expect the subsequent rapid advance in GBP to 1.3894. Upward momentum is strong and there is room for GBP to advance further. That said, overbought shorter-term conditions suggests that 1.3955 may not come into the picture so soon. All in, the positive outlook is deemed intact as long as GBP does not move below 1.3770 (‘strong support’ level was at 1.3740 yesterday).”

Palladium (XPD/USD) fades early Asian bounce off weekly low, up 0.10% intraday taking rounds to $2,615, ahead of Wednesday’s Asian session. In doing s

Palladium snaps two-day downtrend, stays pressured of late.Bearish MACD, failures to cross 100-DMA keep sellers hopeful.200-DMA, 61.8% Fibonacci retracement and June’s low add to the extra downside filters.Palladium (XPD/USD) fades early Asian bounce off weekly low, up 0.10% intraday taking rounds to $2,615, ahead of Wednesday’s Asian session. In doing so, the commodity seesaws around 50% Fibonacci retracement (Fibo.) of January-May upside and an ascending trend line from June 18. With the bearish MACD signals firming below 100-DMA, coupled with failures to keep the latest rebound, palladium bears are likely to retake the controls. However, a daily closing below the $2600 round figure becomes necessary ahead of targeting the 200-DMA level of $2,551. Also acting as the downside filters are 61.8% Fibo. and the last month’s bottom, respectively around $2,510 and $2,460. Alternatively, recovery moves remain elusive below the 100-DMA level of $2,750 but the return of $2665 and the $2,700 can’t be ruled out. Overall, XPD/USD teases the bears ahead of the US Federal Open Market Committee (FOMC). Palladium: Daily chart Trend: Further weakness expected  

Norway Retail Sales dipped from previous 5.8% to -0.1% in June

Germany Import Price Index (MoM) meets expectations (1.6%) in June

Germany Gfk Consumer Confidence Survey came in at -0.3, below expectations (1) in August

Germany Import Price Index (YoY) came in at 12.9%, above forecasts (12.8%) in June

United Kingdom Nationwide Housing Prices s.a (MoM) came in at -0.5% below forecasts (0.6%) in July

United Kingdom Nationwide Housing Prices n.s.a (YoY) came in at 10.5% below forecasts (12.1%) in July

According to flash data for gold futures markets from CME Group, open interest shrank by nearly 16K contracts after five consecutive daily builds. Vol

According to flash data for gold futures markets from CME Group, open interest shrank by nearly 16K contracts after five consecutive daily builds. Volume followed suit and went down for the second straight session, no by around 33.2K contracts. Gold now targets the 200-day SMA around $1,820Gold charted an inconclusive session on Tuesday amidst shrinking open interest and volume. That said, price action appears poised to extend the side-lined formation in the very near term,  while occasional bullish attempts are seen facing the next target of note at the 200-day SMA at $1,820 per ounce troy.

Japanese Economy Minister and Minister in charge of the covid response, Yasutoshi Nishimura, said that three prefectures near Tokyo will ask for a sta

Japanese Economy Minister and Minister in charge of the covid response, Yasutoshi Nishimura, said that three prefectures near Tokyo will ask for a state of emergency on Thursday. “Rise in cases due to test results delayed during last week's holidays expects further rise this week,” Nishimura added.   more to come ...

In opinion of FX Strategists at UOB Group, EUR/USD is forecast to keep trading between 1.1750 and 1.1860 for the time being. Key Quotes 24-hour view:

In opinion of FX Strategists at UOB Group, EUR/USD is forecast to keep trading between 1.1750 and 1.1860 for the time being. Key Quotes 24-hour view: “Our expectation for EUR to ‘trade in a quiet manner within a 1.1750/1.1800 range’ yesterday was incorrect as it dipped to 1.1768 before rising quickly to 1.1840 during NY hours. The rapid rise appears to have room to extend but any advance is unlikely to challenge the major resistance at 1.1860 (minor resistance is at 1.1840). Support is at 1.1800 followed by 1.1780.” Next 1-3 weeks: “Our update from yesterday (27 Jul, spot at 1.1800) still stands. As highlighted, the recent mild downward pressure has eased and EUR has moved into a consolidation phase. From here, EUR is likely to trade within a 1.1750/1.1860 range for a period of time. Shorter-term upward momentum has improved a tad but at this stage, the chance for EUR to move clearly above the top of the expected range at 1.1860 is not high.”

One-month risk reversal of USD/CHF, a gauge of calls to puts, not only snapped a two-day downtrend but also rose the most since January 08, per the la

One-month risk reversal of USD/CHF, a gauge of calls to puts, not only snapped a two-day downtrend but also rose the most since January 08, per the latest data from Reuters. This goes hand-in-hand with the USD/CHF recovery after refreshing the lowest levels in two weeks the previous day. Risk reversals flashed a +0.600 figure for July 27, suggesting the strong bullish bias among the USD/CHF traders. It should, however, be noted that the pair’s sustained trading below the 100-DMA, around 0.9160, on a daily closing basis keeps the sellers hopeful. The same direct USD/CHF bears to the monthly low around 0.9120 before highlighting the 200-DMA level of 0.9070 during the further weakness. Read: USD/CHF Price Analysis: Bears challenge 38.2% Fibonacci retracement

NZD/USD extends the previous day's losses on Wednesday. The pair moves with bearish sentiment in a very narrow trade band. At the time of writing, NZD

NZD/USD remains under pressure in the initial European trading hours.More downside envisioned if price decisively breaks 0.6950.Momentum oscillator holds onto the oversold zone with a neutral stance.NZD/USD extends the previous day's losses on Wednesday. The pair moves with bearish sentiment in a very narrow trade band. At the time of writing, NZD/USD is trading at 0.6952, down 0.06% for the day. NZD/USD daily chart Technically speaking, the descending trendline from the high of 0.7317 made on May 26 acts as a strong barrier for the bulls. The formation of multi supports near the 0.6950 makes it a critical level to trade. That said, If NZD/USD is sustained below 0.6950,  it could find the first support near the June 21 low in the vicinity of the 0.6935 area. The Moving Average Convergence Divergence (MACD) indicator trades in an oversold zone . Any downtick in the MACD could trigger more selling opportunities in the pair. The bears would see the levels last seen in 2020. Next, NZD/USD would test the low of July 21 low at 0.6894 followed by the low made on November 19, 2020, at 0.6878. Alternatively, if price moves higher,  it will first locate the upside target at the 0.7000 horizontal resistance level followed by the July 15 high at 0.7046. Next, the market participants would be encouraged to take over the 0.7080 horizontal resistance level. NZD/USD additional levels
 

Gold price is rising back above $1800, defending the key support area around $1798 amid a cautious market mood heading into the Fed decision. The sell

Gold price bounce after defending key support around $1798 once again.Markets remain cautious ahead of the crucial Fed decision. Gold bears await break below 100-day SMA at $1,796Gold price is rising back above $1800, defending the key support area around $1798 amid a cautious market mood heading into the Fed decision. The sell-off in the Chinese stocks seems to have paused, offering some support to the Asian indices, although surging covid cases in Asia remain a drag on the investors’ sentiment. A retreat in the US Treasury yields and the risk-off mood is boding well for gold price. Meanwhile, the US dollar holds the lower ground amid downbeat US Durable Goods data and pre-Fed repositioning. All eyes remain on the Fed decision, as markets bet on a hawkish signal from the world’s most powerful central bank. The Fed is expected to hint at a likely taper starting off from the final quarter of this year. Gold Price: Key levels to watchThe Technical Confluences Detector shows that gold has managed to defend powerful support around $1798, which is the convergence of the Fibonacci 61.8% one-day, Fibonacci 23.6% one-week and SMA100 one-day.   Acceptance below that level could revive the bearish interests, calling for a test of the previous day’s low at $1794. Further south, the intersection of the previous week’s low and Fibonacci 23.6% one-month at $1791 will be a tough nut to crack for gold bears. Alternatively, if the buyers need to find a strong foothold above the key resistance at $1805 to unleash further upside. That level is the confluence of the previous day’s high and Bollinger Band one-hour Upper. The relevant upside target appears at $1812, where the SMA10 one-day, Fibonacci 61.8% one-week and the pivot point one-day R2 merge. The bulls will then look to take out the Fibonacci 38.2% one-month at $1814. Despite the renewed bids, it's going to be a bumpy ride for gold bulls. Here is how it looks on the tool          About Technical Confluences Detector The TCD (Technical Confluences Detector) is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc.  If you are a short-term trader, you will find entry points for counter-trend strategies and hunt a few points at a time. If you are a medium-to-long-term trader, this tool will allow you to know in advance the price levels where a medium-to-long-term trend may stop and rest, where to unwind positions, or where to increase your position size.

USD/INR stays pressured around 74.45, down 0.16% intraday, during early Wednesday. In doing so, the Indian rupee (INR) pair consolidates the previous

USD/INR consolidates the heaviest daily gains in a week, offered near intraday low.IMF cuts India’s 2021 GDP forecast to 9.5%, China's growth predictions cut by 0.3% to 8.1%.India reports 43,654 covid infections, the highest since July 08.No rate change, tapering is expected from Fed but Powell’s word will be the key.USD/INR stays pressured around 74.45, down 0.16% intraday, during early Wednesday. In doing so, the Indian rupee (INR) pair consolidates the previous day’s gains despite downbeat catalysts for India. Among them, the International Monetary Fund’s (IMF) downward revision to the Asian nation’s FY 2021 GDP forecasts to 9.5%, versus 9.8% prior expectations, gains major attention. The international lender cites “a lack of access to vaccines and renewed waves of COVID-19 cases” as the key catalysts behind the downgrade in GDP predictions, per Reuters.  It’s worth noting that the IMF also cut China’s economic forecast to 8.1% while keeping global growth expectations of 6.0%. Also on the negative side were the latest coronavirus numbers as the daily infections jumped to three weeks high after easing to March lows the previous day. On a broader front, the US revised mask mandate and virus figures from Australia’s New South Wales jumped to March 2020 levels. Furthermore, the UK registered the highest virus-led deaths in four months on Tuesday. Other than the IMF predictions and covid headlines, the US-China tussles and Beijing’s crackdown on IT and education stocks also weigh on the market sentiment, not to forget pre-Fed caution, defending the US dollar from the bears. Against this backdrop, stock futures print mild losses and the US 10-year Treasury yields pause the recovery moves by the press time. Moving on, USD/INR traders will keep their eyes on the Fed announcements for near-term direction as inflation pick-up in India fails to direct the Reserve Bank of India (RBI) of late. Read: Fed Interest Rate Decision Preview: The horns of a inflation dilemma Technical analysis Intraday USD/INR up-moves remain capped by 74.60, comprising 21-DMA, but the downside stays doubtful before breaking late June’s low near 74.05.  

Japan Leading Economic Index meets forecasts (102.6) in May

Japan Coincident Index below expectations (92.7) in May: Actual (92.1)

USD/CAD remains pressured around 1.2585, down 0.14% intraday, ahead of Wednesday’s European session. In doing so, the Loonie pair takes clues from the

USD/CAD consolidates the biggest daily gains in a week, flashed the previous day.Oil benefits from downbeat USD, API stockpile drawdown.Covid woes, pre-Fed cautious weigh on market sentiment.Risk catalysts, EIA stockpiles act as extra factors to follow for immediate direction.USD/CAD remains pressured around 1.2585, down 0.14% intraday, ahead of Wednesday’s European session. In doing so, the Loonie pair takes clues from the recovery in oil prices, as well as the US dollar weakness. However, cautious sentiment ahead of the US Federal Open Market Committee (FOMC) verdict and Canada Consumer Price Index (CPI) for June keeps the buyers hopeful. WTI prints 0.27% gains on a day while keeping the previous day’s rebound from $70.90. The oil benchmark justifies downbeat US dollar and bullish Weekly Crude Oil Stock data from the American Petroleum Institute (API), -4.728M versus +0.806M prior. Also helping the oil prices could be the recent chatters surrounding OPEC+ and developing economies. The US Dollar Index (DXY) prints three-day south-run, down 0.03% around 92.45, as market players await the Fed. It should be noted that the greenback recovers of late, amid safe-haven demand, as the covid woes in Australia and the UK escalates while the US also edits mask mandate. Though, China’s crackdown on IT and tuition sectors join the comparatively hawkish Bank of Canada (BOC) that the Fed to weigh on the USD/CAD prices. Amid these plays, S&P 500 Futures track Wall Street’s losses and the US 10-year Treasury yields lick their wounds around 1.23% by the press time. Although the pre-Fed trading lull can keep USD/CAD pressured, likely softening in Canada’s headline inflation numbers for June may restrict the pair’s downside. However, it all depends upon how well the Fed policymakers, specifically Chairman Jerome Powell, manage to defend the easy-money policies. Read: Federal Reserve Preview: Three reasons why Powell could pause, pummeling the dollar Technical analysis USD/CAD pair’s U-turn from 200-DMA gains support from the bearish MACD signals, which in turn directs short-term sellers towards the weekly horizontal support surrounding 1.2530-25. Though, June’s top near 1.2485 will be a tough nut to crack for the sellers afterward. Meanwhile, a daily closing beyond the key level of 1.2605 will be challenged by the highs marked in April and July, respectively around 1.2655 and 1.2810.  

WTI crude oil fades early Asian strength, eases to $71.90 by the press time of pre-European session trading on Wednesday. Even so, the black gold prin

WTI eases from intraday top, remains mildly bid.Convergence of 200-SMA, three-week-old descending trend line probes bulls.Pullback moves can retest weekly support line, MACD portrays traders’ indecision.WTI crude oil fades early Asian strength, eases to $71.90 by the press time of pre-European session trading on Wednesday. Even so, the black gold prints 0.27% gains on a day while keeping the previous day’s rebound from $70.90. With the sluggish MACD conditions, bearish of late, the recent tops surrounding $72.20, also including 200-SMA and a downward sloping trend line from July 06, will keep testing the oil bulls. However, a clear upside break of the same won’t hesitate to recall the $75.00 to the chart, comprising the mid-month top, before directing the energy buyers toward the monthly top near $76.40. Alternatively, a pullback move, which is widely expected, will revisit a week-old support line near $70.80, a break of which will direct the WTI sellers to the $70.00 threshold. It should be noted though that the oil bears’ dominance past $70.00 will be questioned by the last Thursday’s low near $69.70 before highlighting the monthly low surrounding $65.00. WTI: Four-hour chart Trend: Sideways  

GBP/USD treads water on Wednesday in the Asian trading session on Wednesday. The pair confides in a very narrow trade band with no meaningful traction

GBP/USD halts the previous two day’s strong gains on Wednesday.US dollar stands strong on the mixed US economic data, Fed eyed.The sterling maintains its strong stance on Brexit and fall in COVID-19 cases.GBP/USD treads water on Wednesday in the Asian trading session on Wednesday. The pair confides in a very narrow trade band with no meaningful traction. At the time of writing, GBP/USD is trading at 1.3883, up 0.05% for the day. The US Dollar Index (DXY), which tracks the greenback performance against its six major rivals, trades near  92.50, with 0.01% gains. Investors expected a sooner than expected rate hike from the Fed in today’s meeting. The mixed economic data adds little to the USD valuations. The US New Home Sales data fell for the straight third month. The US Durable Goods Orders rose 0.8% in June, much below the market expectations of 3.2% growth. On the other hand, the sterling remained in higher spirit after the Bank of England (BOE) official Gertjan Vlieghe said on Monday that the central bank should keep its stimulus possibly until 2022. Meantime, the EU pauses legal action against the UK over the Northern Ireland (NI) protocol. As for now, investors await the Fed’s Interests  Rate Decision to gauge the market sentiment. GBP/USD additional levels  
 

EUR/USD remains mildly bid, up for the third consecutive day around 1.1825, heading into Wednesday’s European session. The major currency pair confirm

EUR/USD picks up bids to refresh intraday top, prints three-day uptrend.DXY shrugs off firmer Treasury yields as mixed US data backs Fed’s rejection to tapering.FOMC is up for repeating the status-quo, Powell’s words, policy statement will be the key.Bears could take vengeance on hearing the word ‘tapering’, bulls need validations.EUR/USD remains mildly bid, up for the third consecutive day around 1.1825, heading into Wednesday’s European session. The major currency pair confirmed a bullish chart pattern earlier in the week and the upside momentum extends as markets prepare for the US Federal Open Market Committee (FOMC). Behind the moves could be the mixed data signals from the US, as well as the recently picking up coronavirus variant fears. Also, ECB policymakers' readiness, latest by de Cos,  to stay sidelined before confirming the monetary policy reset contrasts the Fed’s latest hawkish tilt, allowing markets to brace for windfall profits. On Tuesday, US Durable Goods Orders and housing numbers came in softer-than-expected for June and May respectively, the notable upward revision to the priors renewed bets that the Fed hawks have scope. Also on the same line could be the strong readings of US CB Consumer Confidence figures that jumped to the pre-pandemic levels, to 129.10 for July. The US Centers for Disease Control and Prevention (CDC) edits mask mandate and Australia’s key coronavirus infected state, New South Wales (NSW) refreshes the 16-month high of the daily cases to probe the EURUSD bulls. Further, the UK reports the highest death toll since March 17 and offers another reason to be worried. Additionally, China’s crackdown on technology and tuition stocks, as well as the Sino-American tussles, also weighs on the market’s mood and put try to defend the US dollar bulls, but cannot ahead of the Fed. Against this backdrop, Wall Street benchmarks snapped a five-day uptrend and the US 10-year Treasury yields also slipped 3.7 basis points (bps) to 1.23% by the press time. The indecision extends in Asia as stock futures pare early day gains. Looking forward, German GfK Consumer Confidence for August, expected +1 versus -0.3 prior, as well as the risk catalysts, can entertain the EUR/USD traders. However, major attention will be given to the Fed. The latest economic projections from the US central bank hint at firmer inflation and growth rate pushing the Fed towards policy normalization. Even so, Chairman Jerome Powell stayed defensive and the latest Delta covid variant woes offer an extra reason for the policymaker to hold the cautious bias before tapering. Fxstreet’s Joseph Trevisani said, “Mr. Powell is highly unlikely to reveal or even expound on any of Fed's considerations or plans on Wednesday afternoon. That will not, of course, stop the markets from running with a perception.” Read: Fed Interest Rate Decision Preview: The horns of a inflation dilemma Technical analysis EUR/USD rises for the third consecutive day on Wednesday after confirming the falling wedge bullish formation on the daily chart. The MACD histogram also prints the strongest bullish signals since late April, backing the breakout. However, 21-DMA probes the pair’s immediate upside around 1.1820, a break of which will aim for the fresh monthly high near 1.1900. Meanwhile, pullback moves become less worrisome until staying beyond the previous resistance line near 1.1780, a break of which should refresh the monthly low under the present one 1.1751. Read: EUR/USD Price Analysis: Bulls knock the door ahead of Fed  

Australian Prime Minister Scott Morrison announced extra stimulus for New South Wales (NSW) as the state refreshed 16-month high, unfortunately, of co

Australian Prime Minister Scott Morrison announced extra stimulus for New South Wales (NSW) as the state refreshed 16-month high, unfortunately, of covid infections to 177. The details suggest additional monetary support for NSW workers affected due to the pandemic outbreak. As a part of the latest change, the weekly aid will rise from $600 to $750 next week for full time workers and $450 (from $375) for part-time. Additional comments (ABC News) I would expect by Christmas that we would be seeing a very different Australia to what we are seeing now.  What we are seeing overseas is but one country to reach that much higher vaccination rate, which gives their governments a lot more options in the suppression limitations they have to use to deal with the virus. Lockdowns become a thing of the past when you are at that level. What I want to assure you of, absolutely assure you of, as you've already heard from the Premier and the Treasurer of New South Wales, that the Commonwealth government has your back just as we've had the back of Australians all through this crisis. AUD/USD remains lackluster AUD/USD seems to have ignored the news by staying mostly sideways around 0.7365-70. Read: AUD/USD: Bearish consolidation continues below 0.7400 on Australia Q2 CPI

The European Central Bank (ECB) Governing Council member and Spanish central bank chief Pablo Hernandez de Cos said that the central bank consider kee

The European Central Bank (ECB) Governing Council member and Spanish central bank chief Pablo Hernandez de Cos said that the central bank consider keeping some of the flexibility of its emergency bond-buying program when it transitions to other asset purchases after the Covid crisis.   more to come ...

USD/INR edges marginally lower in the Asian trading hours on Wednesday. The pair encounters a strong resistance barrier near the critical 74.50 mark.

USD/INR struggles to preserve the previous session’s upside momentum.Bulls face stiff resistance near the 74.50 critical resistance area.Momentum oscillators hold onto an overbought zone with a neutral bias.USD/INR edges marginally lower in the Asian trading hours on Wednesday. The pair encounters a strong resistance barrier near the critical 74.50 mark. At the time of writing, USD/INR is trading at 74.50, down 0.08% for the day. USD/INR daily chart On the daily chart, the pair has been rising from the lows of 72.91 since early June. The ascending trendline acts as a defensive for USD/INR bulls. A sustained move above 74.50,  the key psychological mark would strengthen the upward price action further. The bulls would march toward the 74.80 horizontal resistance level. The Moving Average Convergence Divergence (MACD) indicator trades consistently above the midline, which indicates a continuation of the prevailing trend in the pair. In doing so, the bulls would attempt to recapture the July 20 high at 75.00  A daily close above the 75.00 would open the gates for the levels last seen in April. USD/INR bulls would aim for the April 26 high at 75.26. Alternatively, if price slips below the session’s low, it could move back to the previous day’s low of 74.27. Market participants would then aim for the 74.00 horizontal support level followed by the June 18 low at 73.82. USD/INR additional levels
 

The US will fear China's nuclear weapons development program, warned the highly influential Chinese media outlet, Global Times, in its editorial on We

The US will fear China's nuclear weapons development program, warned the highly influential Chinese media outlet, Global Times, in its editorial on Wednesday.   more to come ...

AUD/JPY remains pressured around 80.88, following the U-turn from an intraday high of 81.04, amid early Wednesday. The quote’s latest swing ignores st

AUD/JPY extends pullback from 50-SMA following Australia inflation data.Q2 CPI crossed upbeat forecast on QoQ, matches market consensus on YoY.Three-week-old resistance line, 200-SMA adds to the upside filters.Bearish MACD, risk-off mood back sellers targeting monthly low.AUD/JPY remains pressured around 80.88, following the U-turn from an intraday high of 81.04, amid early Wednesday. The quote’s latest swing ignores strong Aussie Consumer Price Index (CPI) and RBA Trimmed Mean CPI figures for the second quarter (Q2). Read: Aussie CPI in line with expectations, AUD steady In doing so, the quote steps back from 50-SMA amid bearish MACD signals, joining the sour mood in the market, to keep sellers hopeful. While the weekly bottom surrounding 80.60 can offer immediate support ahead of the monthly low near 79.80, the 80.00 psychological magnet could act as an extra filter to the south. It’s worth noting that the pair’s weakness past 79.80 will need validation from the yearly low near 79.20 before directing the AUD/JPY bears to late December 2020 tops near 78.80. Meanwhile, an upside break of 50-SMA level of 81.05 will escalate the bounce off weekly low towards a downward sloping trend line from July 07 near 81.40. However, a clear upside break of 81.40 enables the AUD/JPY bulls to aim for 200-SMA figures close to 82.70. During the run-up, the 82.00 threshold may offer an intermediate halt. AUD/JPY: Four-hour chart Trend: Bearish  

The Bank of Japan (BOJ) published the 'Summary of Opinions' of its July meeting earlier on, with the key takeaways noted below. “Japan's economy has p

The Bank of Japan (BOJ) published the  'Summary of Opinions' of its July meeting earlier on, with the key takeaways noted below. “Japan's economy has picked up as a trend, although it has remained in a severe situation due to the impact of the novel coronavirus (COVID-19) at home and abroad.” “In Japan's economy, downward pressure on consumption is likely to intensify in the short run due to the reinstatement of the state of emergency.” “For the time being, there is a risk that economic activity will be under further downward pressure stemming from the spread of COVID-19. On the other hand, if the vaccine rollout accelerates, it could improve by more than expected.” “Even though the year-on-year rate of change in the CPI excluding fresh food is likely to increase on the back of a rise in commodity prices, there is a long way to go to achieve the price stability target of 2 percent and maintain that level in a stable manner. Thus, it is important not to tighten monetary policy prematurely.” Market reaction USD/JPY is picking up bids towards 110.00 mainly due to rising US Treasury yields, although the further upside appears elusive amid cautious BOJ’s release and risk-off tone in the Asian equities. The spot was last seen trading at 109.85, up 0.09% on the day.

AUD/USD seesaws around the intraday top, recently down to 0.7365, following the upbeat Aussie Q2 inflation figures amid early Wednesday. The risk baro

AUD/USD eases from intraday top on despite firmer Aussie inflation figures.Australia’s Q2 CPI crosses QoQ forecasts, RBA Trimmed Mean CPI matches market consensus.NSW propels Aussie infections to 11-month top, extends covid lockdown in Sydney by four weeks.Market sentiment improves ahead of Fed, Aussie PM’s speech, covid updates also become important catalysts.AUD/USD seesaws around the intraday top, recently down to 0.7365, following the upbeat Aussie Q2 inflation figures amid early Wednesday. The risk barometers paid a little heed to the second-quarter (Q2) Consumer Price Index (CPI) data as markets await the US Federal Open Market Committee (FOMC) verdict, as well as Australia PM Scott Morrison’s response to the worsening coronavirus conditions at home. Australia Q2 CPI (QoQ) crossed 0.7% forecast and 0.6% prior with 0.8% figures while matching the 3.8% expected YoY figures versus 1.1% previous readouts. Further, the RBA Trimmed Mean CPI 0.5% and 1.6% respectively strong market consensus on the quarterly and the yearly basis in that order. Read: Aussie CPI in line with expectations, AUD steady As the Reserve Bank of Australia (RBA) policymakers have already conveyed their wish to wait for “multiple quarters” of above 2.0% inflation target and the covid woes are escalating in the Pz nation, AUD/USD shrugs of the data. Recently, New South Wales refreshed the highest daily covid count levels since March with 177 numbers, fueling the national tally to 205, an 11-month high. Following the grim results, NSW Premier Gladys Berejiklian formally announced the extension of a four-week lockdown in Queensland. Additionally, Victoria’s unlock is also subject to multiple local restrictions. The Aussie government jostles with the vaccinations and local outbreak of the Delta covid variant but Prime Minister Morrison remained optimistic during his last public appearance and hence his speech for today will be closely observed. Elsewhere, the International Monetary Fund (IMF) conveyed economic concerns over the virus's resurgence and challenged the market sentiment. Also, China’s crackdown on IT and private education, as well as a deadlock over US President Joe Biden’s infrastructure spending, add to the market’s cautious mood ahead of the key FOMC. However, S&P 500 Futures consolidate the previous day’s losses and the US 10-year Treasury yields also add 1.7 basis points (bps) by the press time, putting a bid under the riskier assets like AUD/USD/ Moving on, comments from the Aussie PM and the Fed decision will be the key for near-term AUD/USD moves. However, the bears are likely to keep the reins. Read: Federal Reserve Preview: Three reasons why Powell could pause, pummeling the dollar Technical analysis AUD/USD bulls battle 10-DMA around 0.7375, a break of which will direct the quote towards a monthly resistance line near 0.7405. However, the pair’s upside remains doubtful until staying below the 200-DMA level close to the 0.7600 threshold.  Meanwhile, tops marked during late 2020 surrounding 0.7340 and the monthly low, also the lowest since November 2020, near 0.7290, could challenge the short-term bears.  

Australia’s second-quarter Consumer Price Index has been published in line with expectations and there has been no market reaction. Australia’s Q2 CPI

Australia’s second-quarter Consumer Price Index has been published in line with expectations and there has been no market reaction.  Australia’s Q2 CPI  Australia Q2 CPI headline rate 3.8% YoY vs. expected 3.8%. More to come... AUD crosses update AUD has stood still in response to the data as follows: Additionally, the prior analysis EUR/AUD bulls banking on a benign Aussie CPI outcome, as not seen a boost as needed.  Aussie COVID lockdowns in focus Meanwhile, markets are more concerned for Sydney’s lockdown that looks likely to be deeper and longer than markets first presumed.  It has been announced that it will extend for another 4-weeks. However, some analysts anticipate tight restrictions to continue until at least the end of September, such as analysts at ANZ Bank. ''There have also been lockdowns in Victorian and South Australia. As a result, we expect Gross Domestic Product to fall 1.3% QoQ in Q3, compared with our previous estimate of +0.4%,'' the analysts said.  ''Further government support seems likely, and this will underpin a rebound in activity once restrictions lift. The RBA is also expected to pitch in by delaying the reduction in weekly bond purchases announced at its July Board meeting until at least November.'' Why CPI matters to traders? The quarterly Consumer Price Index (CPI) published by the Australian Bureau of Statistics (ABS) has a significant impact on the market and the AUD valuation. The gauge is closely watched by the Reserve Bank of Australia (RBA), in order to achieve its inflation mandate, which has major monetary policy implications. Rising consumer prices tend to be AUD bullish, as the RBA could hike interest rates to maintain its inflation target. The data is released nearly 25 days after the quarter ends.

Australia RBA Trimmed Mean CPI (QoQ) in line with forecasts (0.5%) in 2Q

Australia Consumer Price Index (QoQ) came in at 0.8%, above forecasts (0.7%) in 2Q

Australia RBA Trimmed Mean CPI (YoY) in line with expectations (1.6%) in 2Q

Australia Consumer Price Index (YoY) in line with forecasts (3.8%) in 2Q

In recent trade today, the People’s Bank of China (PBOC) set the yuan (CNY) reference rate at 6.4929 vs the estimated 6.4934 and the previous at 6.473

In recent trade today, the People’s Bank of China (PBOC) set the yuan (CNY) reference rate at  6.4929 vs the estimated 6.4934 and the previous at 6.4734. About the fix China maintains strict control of the yuan’s rate on the mainland. The onshore yuan (CNY) differs from the offshore one (CNH) in trading restrictions, this last one is not as tightly controlled. Each morning, the People’s Bank of China (PBOC) sets a so-called daily midpoint fix, based on the yuan’s previous day closing level and quotations taken from the inter-bank dealer.

US Dollar Index (DXY) consolidates the weekly losses, flirts with an intraday top around 92.50, amid early Wednesday. In doing so, the greenback gauge

DXY holds onto bounce off three-week-old support line.Momentum defends weekly trend line breakout, directing bulls to 100-SMA.Short-term resistance line, 200-SMA add to the trading filters.US Dollar Index (DXY) consolidates the weekly losses, flirts with an intraday top around 92.50, amid early Wednesday. In doing so, the greenback gauge justifies the market’s cautious mood ahead of the US Federal Open Market Committee (FOMC) verdict while keeping the bounce off a short-term support line. As the Momentum line keeps Friday’s trend line breakout, the DXY is on the way to a 100-SMA level near 92.60. However, any further advances will be tested by a one-week-old falling trend line resistance around 92.85 and the 93.00 threshold. In a case where the US Dollar Index remains firmer past 93.00, the monthly high of 93.20 and the yearly peak surrounding 93.45-50 will be in focus. On the contrary, a downside break of the nearby support line, at 92.30, will be questioned by the 200-SMA level of 92.12 before recalling the bears. Following that, the monthly low near the 92.00 round figure and late June’s swing lows near 91.50 should lure the DXY bears. DXY: Four-hour chart Trend: Further recovery expected  

US inflation expectations, as measured by the 10-year breakeven inflation rate, per the St. Louis Federal Reserve (FRED) data, eased from the seven-we

US inflation expectations, as measured by the 10-year breakeven inflation rate, per the St. Louis Federal Reserve (FRED) data, eased from the seven-week top on Tuesday. In doing so, the risk barometer fades the one-week-old recovery moves, suggesting further hardships for the traders to predict the market sentiment. The drop in inflation expectations could be linked to the latest US data concerning housing prices and Durable Goods Orders as the figures slipped beneath the market forecasts but the previous readouts were revised up. Also challenging the inflation expectations could be the latest Delta covid strain fears in the Asia-Pacific, as well as in the West. It’s worth noting that the US 10-year Treasury yields followed the inflation expectations to the south the previous day before recently consolidating losses around 1.25%, up 1.7 basis points. While the downtick of the inflation expectations seems to trouble the gold buyers, traders are divided over the metal’s near-term performance ahead of the US Federal Open Market Committee (FOMC) verdict.Read: Gold Price Forecast: XAU/USD stays defensive around $1,800, focus on Fed

EUR/USD is trading at 1.6051 and flat on the sessions so far, consolidating the recent bullish rally into daily resistance. The price is stuck between

EUR/AUD is currently trading on the bid following a daily correction. Aussie CPI outcome will be important for the bulls targeting higher daily highs. EUR/USD is trading at 1.6051 and flat on the sessions so far, consolidating the recent bullish rally into daily resistance.  The price is stuck between a pre-Consumer Price Index event range of 1.6040 and 1.6058.  The euro was picking up overnight on the back of continued weakness in the US dollar and this enabled the cross to move higher from the corrective lows at the end of last week's business just below 1.5900. Meanwhile, the event of the day will be Aussie Consumer Price Index for the second quarter.  ''We think +0.8% QoQ, +3.9%y/y (mkt: +0.7%, +3.7%) for headline CPI, and +0.5% QoQ, +1.6% YoY for trimmed mean (mkt: +0.5%, +1.6%),'' analysts at ANZ Bank said.  Such an outcome should reinforce the Reserve Bank of Australia’s view that “while a pick-up in inflation and wages growth is expected, it is likely to be only gradual and modest.” Therefore, assuming the RBA maintains its low profile on the question of QE and lockdowns, there would be expected to be further downside in the Aussie for the foreseeable future as central bank divergences play out.  This could be reflected in today's response to the CPI data and elevate the cross to fresh daily highs in due course.  With that being said, the markets are unlikely to get too carried away into month-end as well as the Fed and US Gross Domestic Product on Thursday.  EUR/AUD technical analysis Bulls are in control and seek a higher daily high in a continuation of the bullish trend.               

GBP/JPY remains on the front foot around 152.50, up 0.08% intraday, amid Wednesday’s Asian session. The cross-currency pair picks up bids inside a one

GBP/JPY stays mildly bid near intraday top, inside weekly rising channel.Channel resistance, 200-SMA offers a tough nut to crack for the bulls.Further gains envisioned on clear break of monthly descending trend line.GBP/JPY remains on the front foot around 152.50, up 0.08% intraday, amid Wednesday’s Asian session. The cross-currency pair picks up bids inside a one-week-old ascending trend channel formation amid firmer RSI. Even so, a convergence of the stated channel’s resistance line and 200-DMA, around 153.00, will challenge the pair’s further upside. Also acting as a barrier to the additional rise will be the RSI line as it inches closer to the overbought region. If at all the quote successfully cross the 153.00 threshold, the mud-July top surrounding 153.50 and the monthly high surrounding 154.10 will be in focus. Alternatively, pullback moves may levitate around a descending trend line from June 23, close to 152.10, a break of which will highlight the 152.00 round figure and the stated channel’s support line near 151.80 for the GBP/JPY bears to watch. Should the pair sellers manage to conquer the 151.80 support, a downward trend to the early July’s swing low near 150.65 can’t be ruled out. GBP/JPY: Four-hour chart. Trend: Further upside expected  

AUD/NZD gains handsome gains on Wednesday after two day’s consolidation on Wednesday. At the time of writing, AUD/NZD is trading at 1.0589, up 0.01% f

AUD/NZD locks gains on Wednesday in the Asain trading session.Cross hangs near multi-day resistance, additional gains above  1.0600.Momentum oscillators indicate underlying bearish sentiment.AUD/NZD gains handsome gains on Wednesday after two day’s consolidation on Wednesday. At the time of writing, AUD/NZD is trading at 1.0589, up 0.01% for the day. AUD/NZD 4-hour chart On the 4-hour chart, the AUD/NZD pair has been trading above the 50-day Simple Moving Average (SMA) near 1.0572.  A  sustained move above the intraday low high would bring more buying opportunities..  In doing so, the first lower higher is found at the 1.0602  horizontal support level. The Moving Average Convergence Divergence (MACD) indicator trades below the midline with a bullish crossover.  Any uptick in the MACD would accelerate the buying pressure toward July 22 high in the vicinity of 1.0620 Alternatively, if price moves lower, it would retest the 50-day Simple Moving Average at 1.0572, Further, AUD/NZD bears would aim for the previous day’s low at 1.0555.
Market Participants will keep their eyes on the 1.0540 horizontal resistance level. AUD/NZD addiioanl levels  
 

Early on Wednesday, at 01:30 GMT, markets will see 2021’s second quarter (Q2) inflation data, for the Australian economy. The headline Consumer Price

Australian CPI overview Early on Wednesday, at 01:30 GMT, markets will see 2021’s second quarter (Q2) inflation data, for the Australian economy. The headline Consumer Price Index (CPI) QoQ is likely to inch up from 0.6% to 0.7% but the YoY figures bear an upbeat forecast to jump to 3.8% from 1.1% prior. Further, the Reserve Bank of Australia's (RBA) trimmed-mean CPI is also expected to rise from 1.1% to 1.6% whereas the QoQ figures may print an uptick to 0.5% from 0.3% previous readouts. Although the RBA policymakers have already conveyed their bearish bias and readiness to hold the monetary policy unchanged until witnessing multiple quarters of inflation above 2.0%, today’s inflation data will be the key as it will portray the heating price pressure. Ahead of the release, Westpac said: In terms of key drivers, demand for dwellings has surged due to low interest rates and the HomeBuilder grants. We are seeing a temporary boost to the CPI from a spike in fresh fruit & vegetable prices, while the surge in crude oil prices and a weaker AUD has boosted auto fuel prices. There was a seasonal lift in health costs associated with the annual health premium reset. Offsetting the gains in Q2 are falling prices for both domestic and international holidays and travel due to government subsidies for airfares and increasing competition. Market consensus is for a 0.7% rise (3.7% year). Westpac is looking for a 0.9% (4.0% year) rise in the headline CPI, and a 0.5% (1.6% year) rise in the trimmed mean measure. How could it affect the AUD/USD? AUD/USD remains sidelined between 0.7370 and 0.7350, recently bid near 0.7365, ahead of the key inflation data release. Being the risk barometer, the quote justifies the market’s cautious sentiment ahead of the Federal Open Market Committee (FOMC) verdict. Also challenging the pair moves could be the covid woes in Australia and a downbeat mood elsewhere, mainly due to China’s crackdown on IT and private tuitions. That said, today’s Aussie inflation figures may trigger intraday buying should they match the upbeat forecasts, despite the RBA’s rejection to respect the spike. However, as the markets await Fed, no major reaction to the data is anticipated unless witnessing extreme numbers. Meanwhile, downbeat figures will exert additional pressure on the AUD/USD prices. Technically, the pair retreats below the monthly resistance line, around 0.7405, signaling another battle with the 0.7340 support on the way to the month’s low, also the lowest since November 2020, near 0.7290. Key Notes   AUD/USD: Bulls and bears jostle below 0.7400, Australia Q2 CPI, Fed eyed AUD/USD Forecast: Consolidating near 2021 lows About the Australian CPI The Consumer Price Index released by the RBA and republished by the Australian Bureau of Statistics is a measure of price movements by the comparison between the retail prices of a representative shopping basket of goods and services. The purchasing power of AUD is dragged down by inflation. The CPI is a key indicator to measure inflation and changes in purchasing trends. A high reading is seen as positive (or bullish) for the AUD, while a low reading is seen as negative (or Bearish).

As per the prior analysis, Silver Price Analysis: Bears taking over and test bullish commitments at key support, silver was finally pushed over the ed

Silver is in the bearish territory after extending the downside. Bulls are looking for a deeper correction to test bearish commitments.As per the prior analysis, Silver Price Analysis: Bears taking over and test bullish commitments at key support,  silver was finally pushed over the edge on Tuesday. Prior analysis, daily and 4-hour charts Live market analysis, 4-hour chart As illustrated, the price indeed fell from the projected resistance area in a retest of the H&S neckline and trendline support.  Meanwhile, the price of silver has corrected close to the 38.2% Fibonacci retracement of the hourly bearish drop. However, there could be some more corrective behaviour to follow for the session ahead should the greenback continue to slide where the DXY now meets hourly resistance in the 91.50s: DXY 15-min chart Overall, XAG is deeper into bearish territories for the longer term as it grapples with weekly support. However, failure to stay below 25 this week, as the 23.6% Fibo, could be bullish for the near term and leave prospects of a 50% mean reversion on the map at 25.63 for the near future:

USD/CAD extends pullback from 1.2604 to refresh intraday low near 1.2590, down 0.08% on a day, amid Wednesday’s Asian session. The loonie pair rose th

USD/CAD consolidates the previous day’s gains around intraday low.Downward sloping RSI line suggests further weakness towards 50, 100-HMA convergence.Weekly rising trend line, descending resistance line from July 19 add to the upside filters.One-week-old horizontal support becomes a tough nut to crack for bears.USD/CAD extends pullback from 1.2604 to refresh intraday low near 1.2590, down 0.08% on a day, amid Wednesday’s Asian session. The loonie pair rose the most in a week the previous day before taking a U-turn from 1.2604. Failures to stay beyond the 1.2600 threshold join a descending RSI line to direct the intraday sellers toward a joint of 100-HMA and 50-HMA near 1.2565. However, a horizontal region comprising multiple lows marked since July 21 restricts the quote’s further weakness around 1.2530-25. Should USD/CAD bears keep reins past 1.2525, June’s top surrounding 1.2485-90 will be in the spotlight. Alternatively, an upward sloping resistance line from July 21, around 1.2635, acts as an extra short-term hurdle to the north of the 1.2600 round figure. Even if the USD/CAD buyers manage to cross the 1.2635 resistance line, a seven-day-old descending trend line near 1.2685 offers an additional challenge for them. USD/CAD: Hourly chart Trend: Pullback expected  

GBP/CAD is a complicated mix of net shorts and technical pointing to a downside continuation in the pending correction towards the daily structure. Th

GBP/CAD is on the verge of a significant correction. GBP net short positions are indicating that there could be more short covering on the way soon. GBP/CAD is a complicated mix of net shorts and technical pointing to a downside continuation in the pending correction towards the daily structure.  The following illustrates the outcome look from both an hourly perspective to a daily perspective.  Hourly chart The bears are stepping in at the highs in early Asia and considering the net short position in GBP and month-end, further squaring of positions could be in order which could equate to an upside continuation in the coming sessions.  The alignment o the 38.2% Fibonacci retracement and the 21-EMA along with the prior hourly lows of 1.7340 are compelling for a meanwhile downside target.  This area would be expected to act as a strong area of support.  However, the first hurdle will be an area of liquidity near 1.7470 and around the 23.6% Fibo. Daily chart Having said that, the daily outlook is bearish below 1.7440 to pick up liquidity from the prior resistance that meets the 10-day EMA.

USD/CHF trades with no clear direction in the Asian trading hours on Wednesday. The pair hovers in a very close trading range with no meaningful tract

USD/CHF remains muted on Wednesday in the Asian trading hour.Bears dominate the trade after the price slips below 20-day SMA.Momentum oscillator tilts in favor of the bearish momentum.USD/CHF trades with no clear direction in the Asian trading hours on Wednesday. The pair hovers in a very close trading range with no meaningful traction. At the time of writing, USD/CHF is trading at 0.9144, up 0.01 % for the day. USD/CHF daily chart On the daily chart, the USD/CHF pair has fallen sharply from the highs of 0.9264 made on July 8. The pair took support near the 38.2% Fibonacci retracement, which extends from the lows of 0.8933, at 0.9140. If price breaks the session’s low, it could test the first downside target at low of July 15 at 0.9117 followed by the 50.0% Fibonacci retracement at 0.9100. The Moving Average Convergence Divergence (MACD) trades above the midline with a bearish crossover. The reading suggests that there is room for further downside to the low made on June 17 at 0.9075. Alternatively, if the pair reverses direction, the first target for USD/CHF bulls could be found at the 20-hour Simple Moving Average (SMA) at 0.9191. Next, the bulls would flex their muscle toward the July 21 high at 0.9231 followed by the 0.9250 horizontal resistance level. USD/CHF additional levels  

AUD/USD remains sidelined, challenging the previous day’s fall, around 0.7360 during Wednesday’s Asian session. The coronavirus woes joined China’s cr

AUD/USD seesaws inside a 20-pips trading range after recalling the bears.Fears over NSW infections supersede optimism over Victoria’s unlock.China stocks, virus woes elsewhere and mixed US data add to bearish momentum.The art of Fed’s rejection to tapering will be the key as no policy action is expected.AUD/USD remains sidelined, challenging the previous day’s fall, around 0.7360 during Wednesday’s Asian session. The coronavirus woes joined China’s crackdown on technology and private tuitions to weigh on the quote on Tuesday. On the same side were the pre-Fed caution and mixed US data, not to forget the deadlock of US stimulus and Sino-American tussles. Having reported the highest daily infections since March, with 175 count, chatters over Australia’s New South Wales (NSW) to mark over 200 figure for the day are all around. The same will propel the national count to a fresh 10 month top while crossing the previous day’s 187 level. Additionally, Victoria officially exits the snap unlock but activity restrictions remain in place for the most of the state. With the NSW outbreak pushing policymakers towards faster inoculation, Aussie PM Scott Morrison is up for a press conference around 11:00 AM Australia Time, the same when the leaders from South Australia (SA), Victoria and NSW will cross the wires. On a different page, US-China tussles escalate over the American ban of Beijing diplomats’ visas as well as the US ties with Hong Kong and Vietnam of late. Furthermore, softer-than-expected prints of US Durable Goods Orders and housing numbers jostle the notable upward revision to the priors, as well as firmer US CB Consumer Confidence to weigh on the sentiment and AUD/USD prices. Amid these plays, S&P 500 Futures track Wall Street’s losses, the first in six days, whereas the US 10-year Treasury yields consolidate recent losses around 1.23% by the press time. Moving on, Australia’s Consumer Price Index (CPI) for the second quarter (Q2) expected 0.7% versus 0.6% QoQ and 3.8% versus 1.1% YoY, will be the key for AUD/USD prices for immediate direction. Should the inflation numbers meet optimistic forecasts, the quote may consolidate the latest losses to prepare for the likely drawdown post-Fed. Also important will be Aussie PM’s press conference as well as the second-tier US data. Read: Federal Reserve Preview: Three reasons why Powell could pause, pummeling the dollar Technical analysis AUD/USD retreats below the monthly resistance line, around 0.7405, signaling another battle with the 0.7340 support on the way to the month’s low, also the lowest since November 2020, near 0.7290.  

GBP/USD extends the previous two day’s gains in Wednesday’s Asian session. The pair trades in a very narrow trade band and awaits for confirmation. At

GBP/USD accumulates minor gains on Wednesday.US dollar trades below 93.00 ahead of the FOMC meeting.The sterling gains on the sharp decline in coronavirus infections.GBP/USD extends the previous two day’s gains in Wednesday’s Asian session. The pair trades in a very narrow trade band and awaits for confirmation. At the time of writing, GBP/USD is trading at 1.3879, up 0.04% for the day. The US Dollar Index (DXY), which tracks the greenback performance against its six major rivals, trades below  92.50, with 0.17% losses. Investors remain nervous about the Fed’s interests rate decision. The Upbeat economic data fails to enhance the USD valuations. The US Durable Goods Orders were up 0.8% in June. The S&P CoreLogic Case-Shiller Home Price Index gained 17% in May on yearly basis. On the other hand, the sterling printed gains against the greenback after the UK recorded 24,950 new cases on Monday, down for a sixth day and well below the 39,950 from a week earlier.
 
On the economic data front, the CBI Retail Sales data came at 23 in July, mildly above the market forecast of 21. Meantime, the EU has backed off a threat of legal action against the UK over the Brexit deal. This, in turn, added to the attractiveness of the pound. As for now, investors await the Fed’s interest rate decision to gauge the market sentiment. GBP/USD additional levels
 

Gold (XAU/USD) aptly repeats the pre-Fed trading lull, consolidates the previous day’s bounce in a tight range surrounding $1,800 amid the early Asian

Gold fades corrective pullback, on a defensive mode of late.Market sentiment sours amid China crackdown on IT, tuition stocks, covid woes and mixed US data.Fed is widely expected to keep monetary policy intact, FOMC statement, press conference will be the key.Gold Weekly Forecast: XAU/USD bears await break below 100-day SMA at $1,796Gold (XAU/USD) aptly repeats the pre-Fed trading lull, consolidates the previous day’s bounce in a tight range surrounding $1,800 amid the early Asian session on Wednesday. The yellow metal cheered the US dollar weakness to snap a two-day downtrend on Tuesday but the recently cautious sentiment seems to weigh on the commodity prices. Mixed data, virus update keep markets worries Although US Durable Goods Orders and housing numbers came in softer-than-expected for June and May respectively, the notable upward revision to the priors renewed bets that the Fed hawks have scope. Also on the same line could be the strong readings of US CB Consumer Confidence figures that jumped to the pre-pandemic levels, to 129.10 for July. Elsewhere, the US Centers for Disease Control and Prevention (CDC) edits mask mandate and Australia’s key coronavirus infected state, New South Wales (NSW) is up for refreshing the 16-month high of the daily cases. Further, the UK reports the highest death toll since March 17 and offers another reason to be worried. In addition to the mixed data and COVID-19 fears, China’s crackdown on technology and tuition stocks, as well as the Sino-American tussles, also weighs on the market’s mood. Against this backdrop, Wall Street benchmarks snapped a five-day uptrend and the US 10-year Treasury yields also slipped 3.7 basis points (bps) to 1.23% by the press time. Although the risk-off mood puts a safe-haven bid under the US dollar, bulls are cautious ahead of the key US Federal Open Market Committee (FOMC) verdict. While inflation pressure remains the concern to press the Fed policymakers towards tapering, recently escalating Delta covid strain woes may stop Chairman Jerome Powell and Company to replay the old art of defending easy-money but keeps bulls on the edge. Amid these plays, Westpac said, “Policy is set to remain on hold at the July FOMC meeting, but we will be looking for additional guidance on the Committee’s perception of the outlook and the balance of risks, and any discussion of the pace of asset purchases. The statement should continue to refer to inflationary pressures as transitory. Fed Chair Powell will deliver the post-meeting press conference at 04:30 AEST.” Read: Federal Reserve Preview: Three reasons why Powell could pause, pummeling the dollar Technical analysis 100-DMA defends gold buyers and so does the upbeat Momentum line but the receding bullish bias of the MACD histogram indicates challenges for the buyers on the way ahead. Also testing the gold optimists is a horizontal line from early May and 200-DMA, close to $1,815 and $1,821 in that order. It’s worth mentioning that the monthly high near $1,835 and May 10 peak around $1,845 offer extra hurdles to the north. Hence, a bumpy road to the north tests the gold’s upside whereas the alternative path has fewer blocks, namely 100-DMA and an ascending trend line from March-end, respectively around $1,799 and $1,775. In a case where the gold prices drop below $1,775, June’s low surrounding $1,750 should return to the chart. Gold: Daily chart Trend: Pullback expected  

United Kingdom BRC Shop Price Index (YoY): -1.2% (June) vs previous -0.7%

USD/JPY edges lower with the previous day’s losses in the Asian session on Wednesday. The movement in the US dollar keeps USD/JPY on the lower side. A

USD/JPY extends the previous session’s decline in the initial Asian trading hours.Lower US Treasury yields undermine the demand for the US dollarUS Dollar Index slips below 92.50, Fed meet eye.USD/JPY edges lower with the previous day’s losses in the Asian session on Wednesday. The movement in the US dollar keeps USD/JPY on the lower side. At the time of writing, USD/JPY is trading at 109.74, down 0.01% for the day. The US 10-year benchmark yields anchored lower near 1.23% ahead of the Fed’s interest rate decision, despite the upbeat economic data. US Consumer Confidence, Housing Prices, and orders for long-lasting products came on the higher side. Investors remained cautious about the Fed’s interest rate decisions and its forward guidance on the inflation and growth outlook. On the other hand, the Japanese yen held the ground on its safe haven appeal as investor’s risk appetite dampens on rising coronavirus infections. The Japanese yen gained against the greenback after the Bank of Japan (BOJ) Governor Haruhiko Kuroda said that the BOJ’s 2% inflation target pulled Japan’s economy out of deflation. As for now, investors wait for the BOJ Summary of Opinions, Leading Economic Index,  and the Fed Interests Rate Decision to gauge the market sentiment. USD/JPY additional levels
 

EUR/USD defends 1.1800 despite the latest pullback from a two-week top, flashed the previous day, amid a quiet Asian morning on Wednesday. That being

EUR/USD struggles to extend two-day uptrend, sidelined of late.21-DMA tests falling wedge bullish chart pattern’s confirmation, MACD back the buyers.Confluence of 50, 100-DMA offers strong resistance, bears have multiple stops on return.EUR/USD defends 1.1800 despite the latest pullback from a two-week top, flashed the previous day, amid a quiet Asian morning on Wednesday. That being said, the quote seesaws around 1.1815 by the press time. The major currency pair rose for the second consecutive day on Tuesday while confirming the falling wedge bullish formation on the daily chart. The MACD histogram also prints the strongest bullish signals since late April, backing the breakout. However, 21-DMA probes the pair’s immediate upside around 1.1820, a break of which will aim for the fresh monthly high near 1.1900. It becomes crucial to note that the EUR/USD advances past 1.1900 will be challenged by the 1.1975-80 region comprising late June tops and convergence of the 50-DMA and 100-DMA. Meanwhile, pullback moves become less worrisome until staying beyond the previous resistance line near 1.1780, a break of which should refresh the monthly low under the present one 1.1751. In doing so, the stated wedge’s support line close to 1.1730 will be in focus. Also challenging the EUR/USD bears will be the yearly low near the 1.1700 round figure. Read: Fed Interest Rate Decision Preview: The horns of a inflation dilemma EUR/USD: Daily chart Trend: Further recovery expected  

US equities paused a five-day march, technology stocks dropped even more, by the end of Tuesday’s North American session. The shares failed to keep th

US equities retreat despite upbeat earnings from the key technology companies.Beijing’s crackdown on technology, education stocks joined upbeat US data to trigger market’s consolidation.Microsoft, Apple, Alphabet all marked upbeat earnings but couldn’t save respective shares.Fed’s move will be the key Amazon earnings are important as well.US equities paused a five-day march, technology stocks dropped even more, by the end of Tuesday’s North American session. The shares failed to keep the bulls happy even as key tech giants marked strong quarterly results and the US data came in below market expectations. The reason could be linked to China’s strong regulatory announcements for the IT and education companies as well as the upwardly revised prior figures of the US data that supersede the latest soft prints. Additionally, a deadlock over US President Joe Biden’s infrastructure spending bill and cautious sentiment ahead of the Federal Reserve (Fed) verdict also weigh on the market sentiment and drag the Wall Street. Read: Forex Today: Dollar weaker as Fed looms Amid these plays, Dow Jones Industrial Average (DJI) dropped 0.24% or 85.79 points to 35,058 whereas S&P 500 Futures slipped 0.47% to 4,401. Nasdaq, however, is the worst affected one with a downside of 1.21% or 180.01 points to 14,660. Apple, Google-parent Alphabet and Microsoft all posted crossed market expectations to the north but concerns over the supply shortage and slightly cautious comments seemed to have disappointed the bulls. It’s worth mentioning that the tech sell-off was all-pervasive as Intel Corp shares dropped over 2.0% despite the firm’s announcement to build Qualcomm chips. On a broader front, US 10-year Treasury yields dropped 3.7 basis points (bps) to 1.239% whereas prices of commodities and Antipodeans also stayed pressured by the end of Tuesday’s North American trading session. Looking forward, Wednesday could be a choppy session ahead of the Federal Open Market Committee (FOMC) decision. Although the US central bank isn’t expected to alter the current monetary policy, equity bears are looking for the policymakers’ hawkish tilt to tighten the grips. Read: Federal Reserve Preview: Three reasons why Powell could pause, pummeling the dollar

NZD/USD portrays the risk-off mood as the US Federal Reserve (Fed) officials roll up their sleeves to rock the markets. That said, the kiwi pair holds

NZD/USD remains pressured following the heaviest daily losses in over a week.Slump in Chinese stocks, firmer US data and covid woes weigh on Antipodeans.Fed is expected to keep monetary policy unchanged, tapering comments eyed.Australia Q2 CPI, virus updates and news from China will be important too.NZD/USD portrays the risk-off mood as the US Federal Reserve (Fed) officials roll up their sleeves to rock the markets. That said, the kiwi pair holds lower ground near 0.6960 amid early Wednesday morning in Asia. Be it China stocks’ south-run or upward revision to the previous readings of the US data, not to forget Delta coronavirus variant fears in Asia and the Sino-American tussles, NZD/USD had to bear it all ahead of the key Federal Open Market Committee (FOMC) verdict. The sour sentiment pulled the US Dollar Index (DXY) back from a two-week low amid the US afternoon trading session. Although US Durable Goods Orders and housing numbers came in softer-than-expected for June and May respectively, the notable upward revision to the priors renewed bets that the Fed hawks have scope. Also on the same line could be the strong readings of US CB Consumer Confidence figures that jumped to the pre-pandemic levels, to 129.10 for July. Elsewhere, Beijing’s crackdown on technology and education stocks joins Australia’s mixed feelings over the covid, after witnessing a fresh high of infections in 10 months, to weigh on the market’s mood and New Zealand dollar (NZD) as well. It’s worth noting that the US-China tension gets heating day-after-day, recently over US restrictions on Chinese diplomats’ visas and relations with Taiwan, which in turn exerts additional downside pressure on the NZD/USD prices, mainly due to New Zealand’s close trading links with China. Amid these plays, Wall Street closed lower, reversing Monday’s gains, whereas the 10-year Treasury yields dropped 3.7 basis points (bps) to 1.239% by the end of Tuesday’s North American trading session. Looking forward, a lack of data/events at home keeps NZD/USD at the mercy of trans-Tasman developments. The same highlights covid updates and Australia’s Consumer Price Index (CPI) for the second quarter (Q2), expected 0.7% versus 0.6% QoQ and 3.8% versus 1.1% YoY. Above all, the Fed meeting will be crucial for today as the art of the policymakers to reject tapering concerns and still not sound bearish will be a test, which if passed can refresh the yearly low of NZD/USD. Read: Fed Interest Rate Decision Preview: The horns of a inflation dilemma Technical analysis A U-turn from the monthly resistance line, near 0.7010, directs NZD/USD bears to 0.6920-15 support confluence comprising multiple lows marked since June 18.  

South Korea Consumer Sentiment Index below expectations (107.7) in July: Actual (103.2)

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