Market Highlights
1 - European stock markets close mixed. IBEX +0.60%, DAX + 0.46%, FTSE -0.17%
2 - BOE rate unchanged today with 3 members dissenting for higher rates
3 - USD sharply lower today, led by USDJPY down over 500 pips before settling at 159.73
4 - Gold gained $35, closing at $4106; Bitcoin up $1.5K to re-test $65K
5 - Brent down 1.75%, or $1.54 to close at $89.20; $90 mark shaping up to be pivotal
Daily Price Activity
Insights
USD INDEX The USD was sold off aggressively today, dropping below the psychological 100.00 level. Softer US inflation data (PCE), digesting Fed’s rate decision (rates kept on hold) as perhaps less hawkish than anticipated, plus the yen’s sharp rally influencing the index. Noticeably US yields remained relatively high which is USD positive. Perhaps a re-pricing today rather than panic selling. Resistance at 100.89 with support at 99.68.
S&P 500 The US stock markets had a strong rebound after yesterday’s sharp sell-off. Interestingly the rally was not broad based with a handful of large technology companies contributing to gains, with more than half of S&P stocks declining on the day. Today’s falling USDX and rising S&P was consistent with improving risk appetite. Buyers will aim above 7500. Resistance at 7479 with support at 7339.
GOLD The metal had a 2nd consecutive strong day, while still remaining contained within it’s recent range. Normally gold and stocks don’t rise together, but today’s catalyst - falling interest rate expectations and a weaker dollar - resulted in both rallying together. The precarious middle east situation also weighed in. Buyers will aim to maintain above $4100 on the way to targeting $4165 (22nd July). Resistance at $4117 with support at $4026.
BRENT OIL Oil was essentially flat today with the market caught between opposing forces. Downside: concerns about global growth, and the current “heat-off” climate in the US/Iran conflict, for now. Upside: weaker USD makes oil cheaper, geopolitical risk remains elevated, notwithstanding the current cease-fire. The lack of direction indicates the market is more focused on supply/demand fundamentals than Fed policy. Price action below the relevant $90 mark adds to the bearish bias. Resistance at $89.60 with support at $86.19.
BITCOIN Buyers remained in control today with BTC adding to the recent upward bias. Notwithstanding the gentle move higher, the trend remains down with price activity confined to a narrow $1.5K range. Contributing to the bullish feel is the fact that dips have been bought rather than turning into bouts of heavy selling. Today’s resistance marks a relevant level as it coincides with the descending trendline. A breakout to the upside would have buyers aiming to test the $67K area and reverse the trend. Resistance at $65K with support at $63.4K.
FX Pivot Levels
