Current Market Trends

Market Overview

Yesterday's testimony by Fed Chairman Jerome Powell offered new insights into the economic landscape and the likelihood of rate cuts. Powell highlighted the need for “more good data” to build confidence that inflation is on track to reach the Fed's 2% target. He remarked that while the labor market remains strong, it isn't overheated. Easing too quickly or too significantly could derail progress on inflation.

The market currently sees a 5% chance of a -25 basis points rate cut at the July 30-31 FOMC meeting, and a 71% chance for the September 17-18 meeting.

Commodity Analysis

GOLD

Gold prices are steady as the market anticipates US inflation rates and the Fed's upcoming rate cut decision. Gold is currently trading within a range of 2365.443 to 2332.174. Despite briefly breaking above resistance yesterday, the price has since returned to this range. Analysts are focusing on September for a potential rate cut decision, which could impact gold prices significantly.

SILVER

Like gold, silver encountered resistance and low volume after Powell's testimony, which boosted Treasury yields and made it difficult for precious metals to gain momentum. However, silver is finding support at 30.668, indicating a potential bullish trend if this support holds.

Currency Analysis

USD (Dollar Index - DXY)

Following Powell's testimony, the dollar experienced a slight recovery, rising above 105.071 before retreating back into the range. The overall bearish trend remains, and we await further price movements.

GBPUSD (Pound Sterling)

The Pound weakened, trading back to 1.27938. Two scenarios are possible: a decline towards 1.26487 or a rally to break above 1.28508 after what seems to be a technical correction. Further price confirmations are needed before making any aggressive moves.

AUDUSD (Australian Dollar)

The Australian Dollar shows continued strength, consolidating where the Pound found weakness. The AUDUSD respects bullish structures, with support at 0.67142. We expect the AUDUSD to rise if positive market conditions continue.

NZDUSD (New Zealand Dollar)

The NZD is expected to strengthen if the Reserve Bank of New Zealand maintains current cash rates, which should bolster the currency against others. We await the rate decision and subsequent market reactions.

EURUSD (Euro)

The Euro consolidates amid political uncertainty in France, trading within the range of 1.08048 to 1.08543. Investors remain cautious, weighing whether to invest in the US or Europe given current uncertainties.

USDJPY (Japanese Yen)

The Yen responded swiftly to Powell's news, losing ground against the dollar and trading above 161.105. We continue to monitor the price movements from here.

USDCHF (Swiss Franc)

The CHF has gained against the dollar, trading below 0.90054 despite recent rate cuts. The overall market direction appears bearish, and we expect further declines if the US proceeds with rate cuts.

USDCAD (Canadian Dollar)

The Canadian Dollar is consolidating between 1.36612 and 1.36328, with a 64% chance of rate cuts expected on July 24. We anticipate the price to remain within this range until the rate decision provides a clearer market direction.