A beginning of the new trading week was quite benign. There were no many relevant macroeconomic releases, hence volatility on the FX market was muffled. Unlike currencies, the European stocks drew most of attention as they were sold-off during today’s session, however they managed to get back their mojo ahead of a close.
Arguably, the oil market was the most attractive for traders today owing to the meeting of the OPEC/non-OPEC joint ministerial monitoring committee which took place in St. Petersburg, Russia. Saudi Arabia’s oil minister Falih said there that it has been no discussion on deeper cuts of production. He added that a return of global oil stocks toward a 5Y moving average is only a matter of time though. Moreover, Saudi Arabia said that it does not rule out possible deeper cuts of its out-turn in August.
Gold prices have been on the rise in recent weeks after hitting there lowest level since March on the 9th July. The decline in the US dollar has been one of the chief causes for this rise, with the global risk sentiment remaining fairly sanguine with stock markets, in the US in particular, holding up well. Given an interesting technical setup we present our view regarding the gold market relating to the Wednesday’s FED meeting.
The latest data on the US economy has shown a better than expected level of confidence in the manufacturing sector amongst purchasing managers but a larger than expected decline in housing starts has mitigated the good news to some extent. One of the possible reasons for the recent weakness in home sales could be the rise in mortgage rates. With the Fed already raising rates twice so far this year the interest charge on mortgages has increased, which naturally dampens demand for houses.
Elsewhere, we got PMIs’ readings from European economies which proved to be predominantly weaker than expected, thus it could challenge a further potential upturn in an economic improvement across the Eurozone. To be precise, a composite Purchasing Managers’ Index for EMU fell to 55.8 from 56.3 in June, IHS Markit said on Monday.
Being at the beginning of the new week it’s worth taking a closer look at recent changes which occurred in the positioning across miscellaneous markets. We’ve conducted an analysis on the latest CFTC report pointing out the most notable changes across markets which could affect prices in the nearest future.
The last week of July will bring some important macroeconomic events. Not only the FED, but also macro data should have a significant impact on the markets. Let us present the most notable events for this week.