1. Forex Market Insight
The European Central Bank (ECB) is expected to raise interest rates by 25 basis points at its 21st July 2022 meeting, which would be the first rate hike since 2011.
The devaluation of the euro is unlikely to affect the ECB’s interest rate path.
A spokesman for the central bank said the ECB is monitoring the euro exchange rate.
This is because it has an impact on inflation, but does not target a particular level.
(EUR/USD 1-hour chart)
We focus on the 1.0017-line today. If EUR runs steadily below the 1.0017-line, then pay attention to the support strength of the two positions of 0.9938 and 0.9864. If the strength of EUR breaks above the 1.0017-line, then pay attention to the suppression strength of the two positions of 1.0107 and 1.0184.
GBP Intraday Trend Analysis
The unexpectedly strong UK GDP data released in the middle of the week.
That prompted Goldman Sachs economists to raise their forecasts for UK economic growth and cut their forecasts for a recession.
The UK’s GDP grew 0.5% in May, beating expectations of 0.1% growth and showing a return to growth from -0.2% in April, the Office for National Statistics said.
In the three months to May, the economy grew by 0.4%, beating widespread expectations of 0%.
(GBP/USD 1-hour chart)
GBP is mainly focused on the 1.1916-line today. If GBP runs below the 1.1916-line, it will pay attention to the suppression strength of the two positions of 1.1820 and 1.1764. If GBP runs above the 1.1916-line, then pay attention to the suppression strength of the two positions of 1.2005 and 1.2056.
2. Precious Metals Market Insight
Gold rebounded from nearly one-year lows Wednesday, 13th July 2022, as the dollar retreated after an initial surge, helping it avoid pressure from the prospect of a sharp interest rate hike following a spike in U.S. consumer prices.
U.S. consumer prices jumped 9.1% year-over-year in June, the largest increase in more than 40 years.
The American people are having to pay more for gas, food, health care and rent, and have the Fed basically set to raise rates by at least another 75 basis points at the end of July.
The dollar then pared gains, boosting demand for gold from overseas buyers.
(Gold 1-hour chart)
Gold pays attention to the 1740-line today. If the gold price runs steadily below the 1740-line, then it will pay attention to the support strength of the 1722 and 1701 positions. If the gold price breaks above the 1740-line, then pay attention to the suppression strength of the two positions of the 1751 and 1760.
3. Commodities Market Insight
WTI Crude Oil
Oil prices rose slightly on Wednesday, 13th July 2022, despite an increase in U.S. oil inventories and U.S. inflation data supporting another sharp rate hike by the Federal Reserve.
Brent crude, the global benchmark, has fallen sharply since hitting $139 in March, near a record high set in 2008.
Investors have been selling oil recently, fearing that aggressive interest rate hikes to stem inflation would slow economic growth and hit oil demand.
(Crude oil 1-hour chart)
Oil prices focus on the 93.57-line today. If the oil price runs above the 93.57-line, then focus on the suppression strength of the two positions of 97.33 and 99.50. If the oil price runs below the 93.57-line, then pay attention to the support strength of the two positions of 90.44 and 88.02.
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