Currencies
- The euro (EUR) crashed yesterday while it reached its 8-month low against the US dollar (USD) at 1.3458. The single currency dropped after the yearly US CPI announcement which was near the target inflation that Fed set. This means that Fed might increase interest rates earlier than expected.
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The US dollar (USD) climbed towards 101.59 against the Japanese yen (JPY). The monthly US CPI and the US Existing Home Sales were near expectations, as US might be the first country raising interest rates.
Equities
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US equities gained yesterday. The US 500 (SPI) advanced to 1980, the US 30 (DOW) went to 17067 and the US Tech (NDQ) to 3958.
Commodities
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WTI Crude (OIL) fell yesterday to 101.80 USD per barrel after industry report showed gasoline supplies expanded in the US. Today the Crude Oil Inventories will be announced with expectations at -2.1M barrels held in inventory.
Mover & Shaker with FX Options
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Gold (XAU) remains range bound and is now trading near 1306 US dollars an ounce. Gold skyrocketed after the yearly US CPI from 1301 all the way up to 1315 before retracing back where is now trading.
- Option traders may consider constructing a Long Straddle on the XAUUSD and gain if the pair moves in either direction, while the risk is limited to the premium paid.
- A Long Straddle can be constructed by buying an at the money Put and an at the money Call.
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Editors’ Picks
EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.