EUR: A move above 1.10 remains possible beyond this week – ING

FXStreet Insights Team FXStreet

EUR/USD briefly printed above 1.10 on Monday on the back of the huge Fed easing repricing. As mentioned above, the dollar may recover a bit more ground today, ING’s FX strategist Francesco Pesole notes.

EUR/USD to trade above 1.10 in short term

“EUR/USD briefly printed above 1.10 yesterday on the back of the huge Fed easing repricing. As mentioned above, the dollar may recover a bit more ground today, and we could see EUR/USD slip back to the 1.090 mark.”

“The 2-year EUR:USD swap rate differential is now -100bp after having touched -71bp yesterday. This is huge volatility, but also follows a tightening trend in the spread that started in April (when it was at -160bp). Our short-term models indicate EUR/USD should be trading above 1.10 even if that spread rewidens by another 20bp in favour of the dollar.”

“In the rest of Europe, NOK should lead the pack in an equity rebound after taking the hit yesterday due to its low liquidity character. We would expect SEK to lag NOK due to lower beta-to-risk sentiment and speculation on a 50bp cut by the Riksbank on 20 August.”

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD breaches below 1.3500, two-day lows

GBP/USD faces renewed selling pressure, eroding the earlier advance and slipping back to the sub-1.3500 region on Wednesday. Cable’s loss of upside momentum follows the resurgence of the demand for the Greenback amid steady geopolitical tensions. Looking ahead, the British Pound is expected to remain under scrutiny in light of the release of UK GDP data on Thursday.

EUR/USD weakens to multi-day lows near 1.1520

EUR/USD makes a U-turn and trades with decent losses near 1.1520 following the closing bell on Wall Street on Wednesday. The US Dollar’s recovery post-US CPI data keeps the risk complex under pressure in a context where geopolitics takes centre stage once again. Moving forward, attention remains on US inflation with the release of Producer Prices alongside weekly Claims.

Gold holds comfortably above $4,400, June 5 high amid receding Fed hike bets

Gold climbs back to its highest level since June 5, touched following the release of the US CPI report on Wednesday, and looks to build on an over one-week-old uptrend. Receding Fed-hike bets continue to drive flows towards the non-yielding bullion amid subdued US Dollar price action. However, the US-Iran standoff could limit any meaningful USD decline and cap the precious metal as traders now look to the US PPI for a fresh impetus.

Bitcoin shows early signs of bottom despite lingering market stress

Bitcoin (BTC) is showing several signs of a potential market bottom as multiple indicators show improving market conditions, according to CryptoQuant analysts. CryptoQuant data revealed that Bitcoin has produced a second early bull signal, a pattern that has historically appeared closer to market bottoms.

Gold has priced a Fed pause. The hike is still coming

July inflation landed exactly where the consensus had it, on all four lines of the release, and Gold responded by adding around 1% and holding fast near $4,400/ounce, trading at its highest since early June. A print that surprises nobody is not supposed to move a metal that far.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.