1. Forex Market Insight
The war in Ukraine and its economic impact, particularly soaring food and energy inflation, has been a major drag on the euro, which has depreciated more than 8% against the dollar this year.
The European Central Bank (ECB) and the Federal Reserve have reacted differently to soaring inflation, also weighing on the euro.
Data on Friday, 1st July 2022, showed that eurozone inflation hit a new record high, adding to the rationale for the ECB to raise interest rates this month.
EUR/USD was up 0.2% at $1.0440, barely holding above a five-year low of $1.0349 hit in May.
(EUR/USD 1-hour chart)
We focus on the 1.0357-line today. If EUR runs steadily below the 1.0357-line, then pay attention to the support strength of the two positions of 1.0357 and 1.0184. If the strength of EUR breaks above the 1.0357-line, then pay attention to the suppression strength of the two positions of 1.0529 and 1.0642.
GBP Intraday Trend Analysis
Global recession fears have kept the dollar higher, even as markets have lowered expectations for a U.S. interest rate hike.
Markets are now pricing in about an 85% chance of another 75 basis point rate hike this month, with rates expected to hit 3.25% to 3.5% by the end of the year, with a cut in 2023.
The dollar index retreated 0.03% to 105.02, not far from last month’s 20-year high of 105.790.
GBP/USD rose 0.4% to $1.2143 on Monday, 4th July 2022, after hitting a two-week low of $1.1976 on Friday, 1st July 2022.
(GBP/USD 1-hour chart)
GBP is mainly focused on the 1.2106-line today. If GBP runs below the 1.2106-line, it will pay attention to the suppression strength of the two positions of 1.2056 and 1.1970. If GBP runs above the 1.2106-line, then pay attention to the suppression strength of the two positions of 1.2243 and 1.2301.
2. Precious Metals Market Insight
Gold fell on Monday, 4th July 2022, as the prospect of higher interest rates weakened the appeal for this non-yielding asset, but a weaker dollar helped gold prices hold firm above the $1,800 support level.
Gold bulls are caught in a quagmire of aggressive Fed policy actions as the prospect of higher U.S. interest rates erodes the appeal for the precious metal, with the Fed expected to raise rates by another 75 basis points this month.
(Gold 1-hour chart)
Gold pays attention to the 1816-line today. If the gold price runs steadily below the 1816-line, then it will pay attention to the support strength of the 1793 and 1783 positions. If the gold price breaks above the 1816-line, then pay attention to the suppression strength of the two positions of the 1832 and 1847.
3. Commodities Market Insight
WTI Crude Oil
Oil prices rose on Monday, 4th July 2022, as supply concerns over reduced OPEC production, unrest in Libya and sanctions against Russia outweighed fears of a global demand recession.
Eurozone inflation hit another record high in June, strengthening the case for a rapid rate hike by the European Central Bank, while U.S. consumer confidence hit a record low.
(Crude oil 1-hour chart)
Oil prices focus on the 102.52-line today. If the oil price runs above the 102.52-line, then focus on the suppression strength of the two positions of 105.01 and 107.52. If the oil price runs below the 102.52-line, then pay attention to the support strength of the two positions of 99.50 and 97.33.
While every effort has been made to ensure the accuracy of the information in this document, DOO Prime does not warrant or guarantee the accuracy, completeness or reliability of this information. DOO Prime does not accept responsibility for any losses or damages arising directly or indirectly, from the use of this document. The material contained in this document is provided solely for general information and educational purposes and is not and should not be construed as, an offer to buy or sell, or as a solicitation of an offer to buy or sell, securities, futures, options, bonds or any other relevant financial instruments or investments. Nothing in this document should be taken as making any recommendations or providing any investment or other advice with respect to the purchase, sale or other disposition of financial instruments, any related products or any other products, securities or investments. Trading involves risk and you are advised to exercise caution in relation to the report. Before making any investment decision, prospective investors should seek advice from their own financial advisers, take into account their individual financial needs and circumstances and carefully consider the risks associated with such investment decision.