USDIndex slipped to test 106.00, before recovering to 106.20. US Stocks opened positively but closed flat for the day. NVDA –6.3%, Novavax -5.01%, AMC +8.03%, GM +4.16%. Asian markets mixed (Hang Seng flat, Nikkei -0.88%). European FUTS also mixed. Yields fell into close (10yr 2.7657%), Oil bounces close to 2% to recoup the $90 handle, Gold rallied over 1% from $1770 support and BTC moved up to test key $24K area.
China continues exercises around Taiwan for 6th day, Russia installs more troops around captured key Ukrainian nuclear power plant, as US promises Ukraine another $1 billion in military aid.
Week Ahead – Highlight of the week is US CPI tomorrow which is expected to decline to 0.2% m/m and 8.7% y/y.
- USDIndex tested down to 106.00 after blockbuster NFP on Friday and holds 106.20 now. AUD & NZD underperformed in Asian session.
- Equities – USA500 closed flat -5.13pts (-0.12%) (4140), tested & rejected 4175 resistance intraday. US500FUTS at 4144 now. 100 MA at 4100.
- Yields 10-year yield fell into close as Treasuries eased with USD. The 2/10yr. yield curve moved as much as 44bp inverted yesterday. 10yr closed 2.765%, trades at 2.76% now.
- Oil – rallied from 6-month lows under $87.00 again to test last weeks support at $90.70, holds at $90.00.
- Gold – rallied from $1770, support to $1788 highs now. 20-day MA $1757.
- Bitcoin surged to $24.2K Monday, before trading at $23.7k now.
- FX Markets – EURUSD back over 1.02000, USDJPY rejected 135.50 Monday back to 135.00 now. Cable tested up to 1.2130 back to 1.2080 support now.
Overnight – UK July Retail Sales beat (+1.6% vs. -1.3%), AUD Consumer Confidence in line (-3%).
Today – EIA STEO, Supply from UK, Germany & US.
Biggest FX Mover @ (06:30 GMT) EURAUD (+0.36%). Bounced from 1.4580 support on Monday after declining from 1.4775 highs on Friday. MAs aligning higher, MACD histogram negative but signal line rising, RSI 53.62 & rising, H1 ATR 0.00161, Daily ATR 0.0134.
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Stuart Cowell
Head Market Analyst
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