The major downtrend that started last year around September is still in control but it's showing signs of getting ripe for a breakout. Over 7000 would be very bullish for FTSE but we may see 6700 first before 7000 and above.
Author
Burak Caplan, PhD
Trading Channels
Based in London, Burak worked as an aerospace engineer in the early years of his career.
USD/JPY extends sell-off below 157.00 in European trading on Thursday. Traders react negatively to the weak US ADP report, smashing the US Dollar across the board and exerting renewed selling pressure on the pair. Meanwhile, hawkish BoJ expectations and intervention risks continue to lend support to the Japanese Yen, rendering it negative for the major.
AUD/USD struggles to capitalize on the previous day's bounce from a nearly two-week low and ranges above 0.7150 in Asia on Thursday, as dismal Australian trade data counter upbeat China's RatingDog Services PMI. However, the pair's upside remains in check as the US Dollar stalls the weak ADP report-led slide amid escalating US-Iran tensions and firming September Fed rate-hike bets.
Gold maintains its bid tone heading into the European session, though it remains below $4,450 amid mixed fundamental cues. Sliding US bond yields and Wednesday's soft US ADP report weigh on the US Dollar, assisting the commodity build on the previous day's goodish recovery from a nearly four-week low. That said, firming US Federal Reserve rate-hike expectations and inflation risks stemming from higher energy prices could act as a tailwind for US bond yields.
On Thursday, we’ll get the latest read on the US service sector when the Institute for Supply Management publishes its August gauge. Consensus points to a marginal improvement to 54.3 from July’s 54.1. If confirmed, the reading would reinforce the sector’s resilience and offer a modest boost to confidence in the broader economy. The ISM will publish the Services Purchasing Managers Index (PMI) on Thursday at 14:00 GMT.
The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.
