Investing.com – Bitcoin and other major cryptocurrencies rose on Monday, while reports that South Korea's second largest crypto exchange Bithumb is expanding into Japan and Thailand raised some eyebrows.
Look for the return of volatility at 0200 GMT when China releases its economic reports. GDP is expected to come in at 6.7%, down slightly from 6.8%. Fixed Asset Investment is expected to come in at 6.0%, down slightly from 6.1%. Industrial Production is estimated to have risen 6.5%, down from 6.8%. Retail Sales are expected to come in at 8.8%, up from 8.5%. Last month’s Unemployment Rate was 4.8%.
On Monday, the USD/JPY is going to continue to be sensitive to U.S. Treasury yields and appetite for risk. The Forex pair could continue to climb if tensions rise due to increasing concerns over the trade dispute between the United States and China. This is because investors are treating the dollar like a safe haven asset. Trading is light early Monday because of a bank holiday in Japan. At 1230 GMT, the U.S. is scheduled to release reports on Core Retail Sales, Retail Sales and Empire State Manufacturing Index. At 1400 GMT, Look for a report on Business Inventories.
Based on last week’s price action and the close at .7425, the direction of the AUD/USD this week is likely to be determined by trader reaction to a downtrending Gann angle at .7437. Keep in mind that we are looking a weekly, short-term, counter-trend moves here. The longer-term trend is down and likely remain down due to the divergence in monetary policy between the Fed and the RBA. If you don’t want to play a counter-trend rally then use the upside targets to initiate new short positions if tested.
Based on last week’s close at 1.1687, the direction of the EUR/USD this week is likely to be determined by investor reaction to the pivot at 1.1680. The most important area to watch this week is the 50%/Gann angle combination at 1.1680 to 1.1675. Basically, look for an upside bias to develop on a sustained move over 1.1680 and for a downside bias to develop on a sustained move under 1.1675.
Based on last week’s close at $1241.80, the direction of the August Comex Gold futures contract is likely to be determined by trader reaction to the Fib level at $1242.80.
Investing.com - The strong dollar looks likely to remain a significant headwind for gold this week, with bearish price action in the precious metal looking set to continue despite growing risk aversion.
Investing.com - Investors will be looking ahead to Federal Reserve Chairman Jerome Powell’s testimony on the economy and monetary policy to a Senate committee on Tuesday.
The markets continue to be shackled by geo-political headwinds, with Trump at the center of it all, the U.S – Russian Summit, trade wars, Iran sanctions to name but a few of the U.S President’s handiwork.
This week, investors will continue to focus on demand for the U.S. Dollar and risky assets. Additionally, the U.S. economic data’s influence on Treasury yields and the chances of additional rate hikes from the Fed will be another catalyst driving the price action in gold. At this week’s Congressional testimony on Tuesday and Wednesday, there is no doubt that Powell will be discussing the direction of interest rates, strengthening inflation and the potential impact of a trade war on U.S. economic growth.
This week’s price action is likely to be tied to risk appetite, trade tensions, domestic data and Fed Chairman Powell’s testimony before Congress.
Investors will continue to focus on demand for risky assets and the U.S. economic data’s influence on Treasury yields and the chances of additional rate hikes from the Fed. There are no major reports from Japan this week. This means that traders will be watching the U.S. data closely. Key reports include U.S. Core Retail Sales and Retail Sales, and Building Permits. Fed Chairman Jerome Powell is also scheduled to speak before Congress on Tuesday and Wednesday.
There were no other major releases last week so the price action in the Australian Dollar, New Zealand Dollar and Japanese Yen was primarily influenced by the U.S. producer and consumer inflation data as well as the consumer confidence report. Traders reacted to these reports because they could help influence the Fed’s interest rate decisions later this year.
Gold markets initially trying to rally during the week but found enough resistance near the $1270 level to turn around and break through the $1250 level. At this point, the market looks as if it is trying to break down below the $1240 level, reaching to lower levels which is where I see a lot of demand.
The US dollar has rallied significantly during the trading week, breaking above the ¥111 level, an area that has been very important over the last couple of months.
The British pound continue to go back and forth during the week, ultimately settling on a negative candle focusing on the 1.32 level. This is an area that I think will continue to define where we go longer-term, but I do see a lot of demand underneath that of course makes it a very interesting proposition.
The British pound rallied significantly during the week, after initially dipping against the Japanese yen. It looks as if the Japanese yen will continue to get pounded, mainly because it is obvious that with the inverting yield curve, the Bank of Japan will not be tightening monetary policy anytime soon.
The Euro fell a bit during the week, but still sees a significant amount of support underneath, especially near the 1.15 level underneath. I believe that the market will continue to look at that market as being very well supported, but it’s obvious that the difficulties continue.
The Australian dollar has fallen during the week, reaching towards the 0.7350 level underneath, an area that continues to see a lot of demand. I believe that the demand goes down to the 0.73 level after that, so those who are more apt to look for value propositions, this could be your opportunity.
Gold markets continue to be very noisy overall, and I think that at this point we will more than likely see volatility. I believe that the $1225 level will offer support, just as the $1250 level will massive resistance. I believe that the market will continue to be very difficult over the short term, of course driven by news headlines.
The US dollar has turned sideways overall during the day on Friday, as we hover above the vitally important ¥112.50 level. This was a target for me previously, and I expect to see a lot of digestion of the gains in this area.
The British pound has initially falling during the day on Friday, but then bounced rather hard from the 1.31 level to show signs of resiliency again. By doing so, this shows that there is a lot of demand near the 1.31 handle, and therefore I think we are starting to put a bit of a “floor” in the market.
The British pound initially fell during the day on Friday, breaking down towards the ¥147.50 level before turning around and showing signs of life. The market looks as if it is trying to go higher though, as the Americans, board.
The Euro fell initially during the day on Friday, reaching down to the 1.1600 level initially, but is looking like buyers are coming back into trying to lift this market at what I think is a reasonably strong demand level.