DAILY MARKET ANALYSIS 07-09-2022

Russian President Vladimir Putin on Wednesday accused the U.S. of wanting to maintain a “dictatorship” over global affairs at the expense of Europe and the rest of the world. Putin slammed the West repeatedly during a speech before business leaders gathered in far eastern Russia, saying sanctions imposed on Moscow for its invasion of Ukraine were a “danger” to the whole world and left Europe worse off.

Stocks

U.S. stocks edged higher as investors braced for continued aggressive interest rate hikes by the Federal Reserve. At 10:16 ET (14:16 GMT), the Dow Jones Industrial Average rose 61 points, or 0.2%, while the S&P 500 rose 0.2% and the NASDAQ Composite rose 0.3%. The Fed remains committed to taming inflation, and the market increasingly believes that means the central bank will raise its benchmark rate by another 0.75 percentage point later this month, as it did in each of June and July. Some investors had hoped slowing inflation signs would signal smaller rate cuts.

Currencies

• EUR/USD alternates gains with losses around the 0.9900 region on Wednesday. Against that, the inability of the pair to regain serious upside traction should keep the door to further retracement open in the near term. Extra losses face the immediate target at the 2022 low at 0.9863 (September 6) seconded by 0.9859 (December 2002 low) and then 0.9685 (October 2002 low).

• GBP/USD pair comes under renewed selling pressure on Wednesday and sinks to the lowest level since March 2020 during the mid-European session. The pair is currently trading around the 1.1425-1.1420 region and seems vulnerable to prolonging a nearly one-month-old descending trend.

•  USD/JPY pair builds on the previous day's blowout rally and gains strong follow-through traction on Wednesday. The pair hits a fresh 24-year peak during the first half of the European session and is currently placed just above mid-144.00s

•  AUD/USD pair recovers its intraday losses to sub-0.6700 levels and climbs to the top end of its daily range during the first half of the European session. The pair is currently trading around the 0.6730-0.6735 region, though any meaningful recovery still seems elusive.

Cryptos

The largest cryptocurrencies were mixed during morning trading on Wednesday, with Ethereum ETHUSD, -2.58% seeing the biggest move, dropping 2.75% to $1,536.54.Polkadot DOTUSD, +2.87% lead the increases with a 1.73% climb to $7.05.Three other currencies posted decreases Wednesday. Bitcoin BTCUSD, -0.32% inched down 0.67% to $18,835.85, and Ripple XRPUSD, -0.30% slipped 0.30% to 32 cents.

Commodities

Gold: struggles to capitalize on its modest intraday bounce and attracts fresh selling near the $1,707 region on Wednesday. The XAU/USD remains on the defensive through the early North American session and is currently trading around the $1,700 round-figure mark.

Oil: Oil prices fell by more than $3 on Wednesday to their lowest since Russia invaded Ukraine on demand fears stoked by looming recession risks and downbeat Chinese trade data.

Up Ahead – Thursday 08-08-2022

•          AUD   RBA Gov Lowe Speaks

•          EUR   Monetary Policy Statement

•          USD   Fed Chair Powell Speaks

*The information presented above is intended for informative and educational purposes, should not be considered as investment advice, or an offer or solicitation for a transaction in any financial instrument and thus should not be treated as such. Past performance is not a reliable indicator of future results.