Market Analysis

The US dollar is edging higher

FOREX

The US dollar is edging higher versus a basket of other major currencies during early Tuesday trading, following three consecutive sessions marked by greenback weakness. After a pause for Easter, traders returned to their desks to find that the American economy is still in pole position for the economic recovery, something that became clearer after Friday’s employment data and Monday’s non-manufacturing sector figures both surprised to the upside. This positivity is in contrast to the situation in Europe, where it appears that the eurozone may be heading for a protracted recession.

Ricardo Evangelista – Senior Analyst, ActivTrades

Source: ActivTrader

 

GOLD
Gold is consolidating above $1,730 as the greenback is slowing down. From a technical point of view, we are still in a lateral scenario in which only a clear climb above $1,750 can open space for further recoveries. That said, the bearish pressure seen in the last few weeks is losing strength and bullion is trying to regain momentum. We are in a phase where gold remains inversely correlated with US yields and the US dollar where any movement of these two assets is generating the opposite reaction on bullion.

Carlo Alberto De Casa – Chief analyst, ActivTrades

 

EUROPEAN SHARES 
Most European markets opened higher on Tuesday following US indices reaching record levels at yesterday’s market close. Even though China adopting a more hawkish tone towards its lending outlook has tempered some of the market optimism sparked by yesterday’s strong US data, stimulus prospective and lifting restriction in the US, investors’ appetite for stocks remains high. This situation is especially notable in Europe where markets opened after a long holiday, with the aim of catching up with the US’s strong performance. However, while market sentiment remains mostly bullish for stocks, a patchy recovery in different regions (US vs China vs emerging markets) could lead to an uneven market performance and create both trading opportunities and dangerous situations for investors.

Pierre Veyret– Technical analyst, ActivTrades

Source: ActivTrader

 

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