1. Forex Market Insight
The euro oscillated broadly against the dollar on Tuesday 7th February 2023, falling to a near one-month low of 1.0669 during the session, rising to 1.0766 after Powell’s speech and closing at 1.0727, close to a close, or about 0.03%.
The ECB may try to correct the market’s dovish interpretation of the February rate decision and statement, which may attract euro buying, but euro confidence is likely to remain low ahead of next week’s U.S. CPI release. The longer-term trend for the euro remains tilted to the upside against the dollar due to its own improving terms of trade, a boost in Chinese growth, a narrowing of the Fed/ECB policy spread and attractive valuations.
The main downside risks lie in a new Russian offensive against Ukraine, a further deterioration in relations between Russia and the West and disruptions in European energy supplies.
(EUR/USD 1-hour Chart)
We focus on the 1.0729 line today. If the EUR runs below the 1.0729 line, then pay attention to the support strength of the two positions of 1.0697 and 1.0642. If the strength of EUR rises over the 1.0729 line, then pay attention to the suppression strength of the two positions of 1.0776 and 1.0802.
GBP Intraday Trend Analysis
The pound bottomed out against the dollar on Tuesday, hitting a near one-month low of 1.1960 during the day and rebounded to 1.2094 after Powell’s speech, closing at 1.2047, up about 0.26%.
After last week’s Bank of England meeting was seen as a dovish result, the market is waiting for further statements from the central bank officials this week. U.K. GDP is expected to be flat in the fourth quarter of 2022, with GDP contracting to 0.4% in December from a year earlier, driven by widespread weakness in construction, manufacturing and services.
(GBP/USD 1-hour Chart)
GBP is mainly focused on the 1.2010-line today. If GBP runs below the 1.2010-line, it will pay attention to the suppression strength of the two positions of 1.902 and 1.782. If GBP runs above the 1.2010-line, then pay attention to the suppression strength of the two positions of 1.2111 and 1.2222.
2. Precious Metals Market Insight
Gold prices reluctantly rose on Tuesday, 7th February 2023, the dollar retreated slightly, Powell said Tuesday, the latest U.S. jobs report showed that the process of driving inflation back to the Fed’s 2% target will take “quite a long time” and pointed out the need to further increase interest rates.
After Powell’s speech, the dollar index fell from a one-month high, pushing gold prices once jumped 0.8%.
(Gold 1-hour Chart)
Gold pays attention to the 1880-line today. If the gold price runs below the 1880-line, then it will pay attention to the support strength of the 1866 and 1847 positions. If the gold price breaks above the 1880-line, then pay attention to the suppression strength of the two positions of 1892 and 1900.
3. Commodities Market Insight
WTI Crude Oil
Oil prices climbed more than 3% Tuesday, 7th February 2023, after Federal Reserve Chairman Jerome Powell eased market concerns about interest rate hikes and a recovery in Chinese demand boosted oil prices.
Federal Reserve Chairman Jerome Powell said Tuesday that the very strong jobs data released last week confirmed that the Fed has some way to go in terms of raising interest rates.
(Crude Oil 1-hour Chart)
Oil prices focus on the 75.04 – line today. If the oil price runs above the 75.04 -line, then focus on the suppression strength of the two positions of 76.00 and 76.89. If the oil price runs below the 75.04 -line, then pay attention to the support strength of the two positions of 73.52 and 72.37.
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