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MTrading Team • 2023-07-21

EURUSD posts first weekly loss in four as traders prepare for next week’s Fed, ECB show

EURUSD posts first weekly loss in four as traders prepare for next week’s Fed, ECB show

Markets consolidate the weekly moves during early Friday amid traders’ anxiety ahead of the next week’s top-tier central bank announcements and preliminary readings of July’s PMIs. With this, the US Dollar pares the first weekly loss in three while the EURUSD licks its wounds by snapping a three-week downtrend.

It should be noted that the yields are sluggish and the Asia-Pacific shares edged lower while the US stock futures print mild gains.

That said, USDJPY bucks the trend amid mixed Japan inflation and dovish concerns about the BoJ whereas the NZDUSD also declines due to pessimism surrounding China. The same weighs on the AUDUSD even if the Aussie buyers resist relinquishing controls of late. It should be observed that GBPUSD cheers the US Dollar weakness the most due to the upbeat UK Retail Sales data for June.

Elsewhere, crude oil rises for the fourth consecutive week whereas the gold price remains indecisive after declining in the last two days.

BTCUSD and ETHUSD also trade on the back foot despite the sluggish US Dollar performance as crypto traders fear harsh US regulations loom as House Republics draft industry framework.

Following are the latest moves of the key assets:

  • Brent oil remains on the front foot around $80.40, up more than 1.0% on a day by the press time.
  • Gold price struggles for clear directions but stays pressured near $1,965 after declining in the last two consecutive days.
  • USD Index seeks clear directions around 100.90 but appears well set for the first weekly gain in three.
  • Wall Street benchmarks closed with mixed, mostly down, whereas stocks in the Asia-Pacific zone edged lower. Even so, equities in Europe and UK trade mixed of late.
  • BTCUSD and ETHUSD print minor losses around $29,800 and $1,890 as we write.
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Dicey markets after a volatile week

Despite mostly impressive Japan inflation, firmer UK Retail Sales and a slew of China measures to defend the skidding economy, the markets remain dicey on early Friday. The reason could be linked to the traders’ indecision ahead of the next week’s top-tier data/events, as well as a lack of confirmation about the Fed’s policy pivot and looming slower economic growth in China and Germany.

It should be noted that the previous day’s upbeat US data and firmer Wall Street performance allowed the US Treasury bond yields and the US Dollar to remain on the front foot, despite the latest inaction. The same prod the riskier assets like commodities, Antipodeans, equities and cryptos, especially when China fails to convince market players.

  • Strong buy: USDCAD
  • Strong sell: ETHUSD, GBPUSD, Gold
  • Buy: USD Index, Nasdaq, USDJPY

Canada Retail Sales, risk news to watch before the crucial week

Canada’s Retail Sales for June may offer the last blow to the likely sluggish day before the weekend. While the data is expected to ease, the US Dollar’s inability to rise joins the upbeat performance of Oil, Canada’s key export item, may help the CAD to remain firmer. Apart from the data, headlines about China, global growth and central banks can also entertain traders.

May the trading luck be with you!