1. Forex Market Insight
Senior Fed officials continue to put hawk, and data show that the U.S. economy has not fallen into recession, inflation has topped foreshadowing, boosting the dollar, but before the release of the U.S. non-farm payrolls this Friday, 5th August 2022, market sentiment is cautious, the dollar maintained in the rally high pull.
Among non-U.S. assets, European currencies are consolidating around key support, still waiting for clear direction.
As this week’s non-farm payrolls for the Fed’s interest rate resolution statement to data speak after the first heavy economic data, the market expects to seek clues from the future rate hikes, until then, market volatility may be cautious.
(EUR/USD 1-hour chart)
We focus on the 1.0190-line today. If EUR runs steadily below the 1.0190-line, then pay attention to the support strength of the two positions of 1.0116 and 0.9999. If the strength of EUR breaks above the 1.0190-line, then pay attention to the suppression strength of the two positions of 1.0277 and 1.0357.
GBP Intraday Trend Analysis
GBP/USD was down 0.8% at 1.2066.
The Bank of England (BoE) raised interest rates by 50 basis points last Thursday, the most in 27 years, despite warnings that a prolonged recession was looming as the central bank moved quickly to curb rising inflation.
BoE warned that the economy will start to shrink from the fourth quarter.
(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 1.2005. 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 prices extended their losses on Friday, 5th August 2022, sliding nearly 1%.
An unexpectedly strong U.S. jobs report eased recession fears and dashed speculation that the Federal Reserve would abandon aggressive monetary tightening.
U.S. job growth unexpectedly accelerated in July, with jobs increasing to levels above those seen before the outbreak.
The unemployment rate fell to a pre-epidemic low of 3.5% from 3.6% in June.
(Gold 1-hour chart)
Gold pays attention to the 1768-line today. If the gold price runs steadily below the 1768-line, then it will pay attention to the support strength of the 1760 and 1751 positions. If the gold price breaks above the 1768-line, then pay attention to the suppression strength of the two positions of the 1783 and 1793.
3. Commodities Market Insight
WTI Crude Oil
Oil prices closed higher on Friday, 5th August 2022, recovering some of the ground lost last week on strong U.S. job growth data, but closed last week at their lowest level since February on concerns that a recession could hit fuel demand.
Last week, oil traders were concerned about inflation, economic growth and demand, but signs of tight supply gave support to oil prices.
The number of active U.S. rigs fell seven to 598 in the week ended 5th August 2022, the first weekly decline in 10 weeks, energy services firm Baker Hughes said in its much-anticipated report on Friday, 5th August 2022.
Supply remains relatively tight and the near-month contract price remains higher than the far-month contract price, a market structure known as the inverse spread.
OPEC and its allies, which make up OPEC+, agreed last week to raise their oil production target by 100,000 barrels per day in September, but it was one of the smallest increases since the production quota system was introduced in 1982, data from the Organization of Petroleum Exporting Countries (OPEC) showed.
The U.S. Treasury Department said on Friday, 5th August 2022, that a senior official from the department will visit Indonesia and Singapore this week to discuss with counterpart officials possible price restrictions on Russian oil exports in response to the conflict between Russia and aggression against Ukraine.
(Crude oil 1-hour chart)
Oil prices focus on the 88.02-line today. If the oil price runs above the 88.02-line, then focus on the suppression strength of the two positions of 90.44 and 91.54. If the oil price runs below the 88.02-line, then pay attention to the support strength of the two positions of 85.72 and 83.74.
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