Stocks in rotation

Frank Walbaum

Important news this week

Mon, 06th 16:00 CET US ISM Services PMI.
Wed, 08th, 04:00 CET NZ RBNZ interest rate decision.
Wed, 08th, 20:00 CET US FOMC Meeting Minutes.
Fri, 10th, 14:30 CET CA Unemployment Claims.

Markets pause as traders watch for an early-July reversal

Markets have started the week in a cautious mood. The US dollar opened little changed, while equities traded sideways after their recent rally and are beginning to look technically stretched. Early July has often seen markets extend gains before profit-taking emerges later in the month, making the coming sessions particularly important. Whether buyers can push indices to fresh highs or whether a broader retracement begins will likely depend on upcoming macro data and central bank expectations.

In FX markets, the Japanese Yen has resumed its weakness, while the New Zealand Dollar is trading cautiously ahead of this week's RBNZ rate decision. Gold and Silver are both testing important resistance levels. Should the US dollar regain strength, precious metals could struggle to break higher and may be vulnerable to a pullback. Oil has found support after recent declines, suggesting downside momentum is fading for now. Attention this week will also be on Canadian employment data and the FOMC meeting minutes, although no major policy surprises are currently expected.

Market talk

Markets remain in consolidation mode after a strong first half of the year. Investors are now asking whether the seasonal pattern will repeat, with another push higher during early July followed by a period of profit-taking. The US dollar remains the key driver across asset classes. A renewed dollar rally could pressure FX pairs, metals, and equities, while continued dollar weakness would likely support the current risk-on environment. For now, traders are watching technical resistance levels closely and waiting for fresh catalysts before committing to the next major move.

Tendencies in the markets

Equities mixed, USD stronger, BTC positive, oil near support, Silver weak, Gold weak.

Author

Frank Walbaum

AUD/USD hangs near three-week low, below 0.6950 as traders await US NFP report

AUD/USD hits a three-week low during the Asian session on Friday as the RBA’s dovish shift and a rout in equity markets weigh on the risk-sensitive Aussie. However, the recent slump in US bond yields to a two-month low keeps US Dollar bulls on the back foot and limits losses for the currency pair as traders look to the US NFP report for a fresh impetus.

USD/JPY bounces off three-week low; keeps the red near 157.65 as focus remains on US NFP

USD/JPY bounces off the weekly low set during the Asian session, as bears turn cautious ahead of the US NFP report due later this Friday. The upside seems limited as the recent slump in US bond yields and hopes of Iran war de-escalation undermine the US Dollar. Moreover, a hawkish BoJ and intervention risks support the Japanese Yen, capping the pair.

Gold loses the grip; $4,000 comes next on the downside

Gold sets aside two daily advances in a row on Friday, opening the door to a potential test of the key $4,000 mark per troy ounce. The precious metal’s retracement follows a decent improvement in the sentiment surrounding the US Dollar, solid NFP data and higher US Treasury yields across the board.

Democrats win House and Senate in US midterms: Why isn’t all bad news for crypto

The biggest story this week was Tuesday’s US midterm elections, which saw Democrats win control of both the House and the Senate in a clear blue wave. This political shift in the US has triggered sharp price swings across the cryptocurrency market.

Week ahead – Inflation and geopolitics in focus as US political landscape shifts

Post-midterm election euphoria fizzles out as risk aversion prevails. US CPI, PPI and Fedspeak on the radar as Fed hike bets remain supported. Oil retreat pauses on mixed hopes about the ongoing conflicts.

US Dollar breaks below 101.50 as Democrats sweep Congress

The US Dollar (USD) comes under heavy selling pressure on Wednesday, with the US Dollar Index (DXY) falling around 0.5% to trade near 101.35 after sliding below the 101.50 level. The Greenback retreats to its lowest level in four weeks as investors reassess the political and economic outlook following the Democratic Party's sweeping victory in the United States (US) midterm elections.