Precious metals market disrupted

Frank Walbaum FX Strategies.Asia

Important news for the day

Wed, 04th, 01:30 CET AU Gross domestic product.
Wed, 04th, 14:15 CET US ADP employment change.
Wed, 04th, 16:00 ET US ISM services pmi.

Market disruptions

According to news reports by the Financial Times the precious metals market is currently disrupted. Due to airport closures in Dubai in the Middle East metals can’t be transport, which accounts for about 20% of the global market. Furthermore, also oil from Iraq seems to be in a similar situation. With the closure of the Strait of Hormuz, most oil can’t be transported out of the country, as ships are being absent. Following the recent correction in gold and silver, prices could therefore pick up speed again. The oil price is already on an upward trend and could soon test the USD 80.00 mark.

Market alk

The Dollar continues with its strength and the Dollar index has been rising beyond the 50- moving average technical resistance zone baked on the weekly chart. More upside might hence be observed, which could also harm US stocks. The crypto market, on the other hand, is rising slightly. Also, the German DAX is pushing high ron top of the 50- moving average zone also based on the weekly chart. If the situation calms now, equities might start moving higher again, whereas negative headlines could dampen the risk sentiment. The focus might soon shift as well towards US data, with today’s ADP employment report.

Tendencies in the markets

Equities sideways, USD stronger, crypto sideways, oil strong, Silver positive, Gold positive.

Author

Frank Walbaum

FX Strategies.Asia

Frank has been working in the TV business for several years. Acquiring his skills in Germany’s biggest broadcasting station, he then chose to work and live in Asia, which was in 2007.

EUR/USD retreats toward 1.1600 after upbeat US data

EUR/USD pulls away from session highs and declines toward 1.1600 in the American session on Wednesday. Upbeat private sector employment and ISM Services PMI data from the US help the US Dollar (USD) stay resilient against its rivals, limiting the pair's upside.

GBP/USD meets resistance around 1.3400

In line with its risk-linked peers, GBP/USD stages a modest comeback on Wednesday, although meeting some resistance around the 1.3400 neighbourhood. Cable’s humble recovery struggles to gather momentum as the Greenback benefits from better-than-forecast macroeconomic data releases.

Gold loses traction after testing $5,200

Gold corrects lower after testing $5,200 but manages to stay in positive territory in the second hald of the day on Wednesday. The precious metal remains well supported by the deterioration of the geopolitical scenario in the Middle East, while the US Dollar's resilience caps the upside.