DAILY MARKET ANALYSIS 06-10-2022

The OPEC+ meeting in Vienna yesterday did not disappoint with the organization announcing a supply cut of 2MMbbls/d beginning in November 2022 and concluding at the end of 2023 – this is subject to change should circumstance necessitate. Brent crude oil expectedly rallied on the back of this announcement with pre-meeting rumors pointing to some form of reduction in supply between 1MMbls/d – 2MMbls/d.

Stocks

U.S. stock futures tumbled in the early Thursday morning as investors continued Wednesday’s selling spree after September’s data revealed another month of labor market strength. Investors are now sure about the Fed’s continued aggression, and as a result a recession. Futures on the Dow Jones Industrial Average (DJIA) dipped 0.34%, while those on the S&P 500 (SPX) lost 0.38%, as of 5.27 a.m. EST, Thursday. Meanwhile, the Nasdaq 100 (NDX) futures dipped 0.33%.

Currencies

• EUR/USD trades without a clear direction below the 0.9900 region on Thursday. The pair failed to test/surpass the parity level in the last couple of sessions, opening the door to further weakness in the short-term horizon.

• GBP/USD pair meets with a fresh supply following an uptick to the 1.1385 region and turns lower for the second successive day on Thursday. The downtick drags spot prices to mid-1.1200s, closer to the overnight swing low during the mid-European session and is sponsored by the emergence of some US dollar dip-buying.

•  USD/JPY pair struggles to capitalize on the previous day's bounce from the 143.50 area, or over a one-and-half-week low and oscillates in a narrow band on Thursday. The pair remains below the 145.00 psychological mark through the first half of the European session, though the bias still seems tilted in favour of bullish traders.

•  AUD/USD pair surrenders a major part of its intraday gains and slips below the 0.6500 psychological mark, back closer to the daily low during the first half of the European session.

Cryptos

Cardano has long been a favourite of long-term investors but has struggled for much of 2022 and is down more than 80% since the start of the year when it traded at $2.28. While ADA endured a bearish September like much of the rest of the crypto markets, key updates and solid token fundamentals mean it could be set for a breakout in October - which is traditionally a bullish month for crypto.

Commodities

Gold: struggles to gain any meaningful traction on Thursday and seesaws between tepid gains/minor losses through the early North American session. The XAU/USD is currently placed in neutral territory, around the $1,715 region as traders await a fresh catalyst before positioning for the next leg of a directional move.

Up Ahead – Friday 07-09-2022

•          USD   Non-Farm Employment Change

•          CAD   Unemployment Rate

*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.