GOLD
Gold prices look well supported above the $1,950 level and even touched a one-month high during early Tuesday trading. The precious metal is benefiting from a weakening US dollar, which continues to lose ground to other major currencies as market expectations increasingly shift towards seeing July’s 25 bp rate hike as the last in the current cycle. The flagging greenback and lower treasury yields support the price of the non-yielding bullion; however, there could still be twists in this story. Later today, we’ll have the release of US retail sales and industrial production. Investors will watch closely because a surprise to the upside could once again highlight the resilience of the American economy and give the Fed food for thought in the runup to this month’s meeting.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
EUROPEAN SHARES
Stock markets opened mixed in Europe on Tuesday, extending the uncertain sentiment registered in Asia overnight, while US futures fluctuated.
The uncertain market sentiment towards riskier assets continues today as investors await more corporate and macro developments.
European investors have temporarily limited their exposure to stocks, especially as benchmarks already trade close to major technical resistances, ahead of the highly awaited EU CPI data due tomorrow. Elsewhere, the focus remains on the corporate agenda with today’s Q2 reports from BofA and Morgan Stanley, which should shape some of the price action in the banking sector.
Meanwhile, the Euro currency is rising while oil markets trade lower and EU bonds fluctuate, which doesn’t provide the ideal set-up for bull traders on the stock markets.
This sentiment is unlikely to change significantly due to the lack of major macro news in today’s agenda. The STOXX-50 index should keep trading sideways between 4,385.0pts and 4,350.0pts as long as no strong market driver shakes today’s mood. More support levels can be found below 4,350.0pts, and around 4,330.0pts, 4,305.0pts and 4,280.0pts, by extension, in the case of a bearish break-out.
Pierre Veyret– Technical analyst, ActivTrades
Source: ActivTrader
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