EURUSD
- EUR/USD rose 0.14% to 1.1025, following the European Central Bank's decision to hike its benchmark interest rates by 25 basis points.
- ECB President Christine Lagarde signaled that there could be more rate hikes to come in the future. However, the central bank also noted that previous rate increases had been "transmitted forcefully" into financing and monetary conditions, leading some investors to speculate that the ECB might end its tightening cycle sooner than expected.
- Despite the ECB's hawkish stance, the U.S. monthly jobs report, which was released on Friday, could potentially impact the EUR/USD exchange rate. The report was expected to show that nonfarm payrolls rose by 180,000 in April, a decrease from the previous month's 236,000 job additions.
- The market's reaction to the jobs report could influence the Federal Reserve's monetary policy decisions. If the report indicates weaker-than-expected job growth, it could delay the Fed's plans to raise interest rates, potentially weighing on the USD and boosting the EUR/USD exchange rate.
- Additionally, other factors such as geopolitical tensions, global trade, and economic growth could also impact the EUR/USD market.
| SMA (1D) | Slighty Rising |
| |
| RSI (1D) | Slightly Rising |
| |
| MACD (1D) | Neutral |
Closing statement: Overall, the EUR/USD market remains in a state of flux, with conflicting factors influencing the exchange rate. While the ECB's rate hike signals strength for the euro, weak U.S. job growth could potentially dampen the dollar's appeal. Traders should keep a close eye on economic data releases, geopolitical events, and global market trends to gauge potential opportunities and risks in the EUR/USD market.
GBPUSD
- GBP/USD rose 0.24% to 1.2601, reaching a new one-year high as the Bank of England continues its fight against inflation.
- The UK's headline consumer price inflation stands at 10.1%, which is five times the BOE's mandate and significantly higher than the inflation rates in the euro zone and the US.
- The dollar weakened as the DXY, which tracks the dollar against six other currencies, traded 0.16% lower at 101.28, dropping more than 0.6% in the previous session.
- The Fed raised interest rates on Wednesday, but removed the phrase "anticipates" from its statement, indicating that this may be the peak of its year-long aggressive tightening cycle.
- The market will keep a close eye on the upcoming economic releases, including UK and US inflation data, which could provide more insight into the future direction of the GBP/USD exchange rate.
| SMA (1D) | Slightly Rising |
|
||
| RSI (1D) | Slightly Rising |
|
||
| MACD (1D) | Slightly Rising |
|
Closing statement: With the Bank of England's ongoing battle against inflation and the Fed hinting that it may have reached the peak of its tightening cycle, the GBP/USD exchange rate continues to see strong upward momentum. As economic data releases loom, the market will be watching closely to see if this trend continues.
GOLD
- Gold prices remained below record highs as traders locked in some of the recent profits, while the market remained cautious ahead of key U.S. labor data.
- The demand for gold as a safe haven was also supported by worsening sentiment over a U.S. banking crisis following the collapse of First Republic Bank earlier this week.
- According to Fed Fund futures prices, there is over a 90% chance that the Federal Reserve will keep interest rates steady in June, which could further support gold prices.
- The U.S. dollar fell during early European trade on Friday, as traders worried that the ongoing turmoil in the U.S. banking system might lead to earlier-than-expected rate cuts by the Federal Reserve.
- The price of gold may be influenced by the upcoming U.S. labor data, which is expected to factor into monetary policy, and any further developments in the U.S. banking crisis.
Closing statement: The price of gold may continue to be influenced by market sentiment and economic data, including the U.S. labor data and the ongoing banking crisis. Traders will likely closely monitor any further developments that could impact monetary policy and the demand for safe haven assets like gold.
CRUDE OIL
- Crude oil prices were set for their worst weekly drop in nearly two months, amid concerns of slowing U.S. economic growth and weaker-than-expected rebound in Chinese demand.
- Another factor that weighed on the prices was the fear of a U.S. banking crisis, which could further impede economic growth, following the collapse of yet another U.S. bank this week.
- However, there was some support for oil prices due to supply concerns stemming from Iran and Russia.
- The weakness in the dollar, due to growing expectations for a Federal Reserve rate pause, also limited the decline in crude markets.
- Earlier in the week, Chinese manufacturing activity unexpectedly contracted in April, pointing to an uneven economic recovery in the country as it recovers from three years of COVID disruptions.
| SMA (1D) | Slightly Falling |  |
||
| RSI (1D) | Rising |
|
|
|
| MACD (1D) | Falling |
|
|
Closing statement: While crude oil prices experienced significant losses this week, supply concerns and weakness in the dollar provided some support. However, concerns over U.S. banking crisis and uncertainty surrounding the Chinese economic recovery could continue to weigh on the market in the coming weeks.
DAX
- European stock markets are expected to open higher, aided by positive results from Apple and as investors digest the ECB’s monetary policy decision.
- The DAX futures contract in Germany traded 0.15% higher, while the CAC 40 futures in France climbed 0.39%, and the FTSE 100 futures contract in the U.K. rose 0.27%.
- German industrial orders fell by 10.7% from the previous month in March, significantly more than expected, marking the largest month-on-month decline since 2020 due to the pandemic.
- Adidas stock climbed over 7% after the German sportswear giant's first-quarter results came in better than expected, fueling hopes of a turnaround.
- Investors are awaiting the key U.S. jobs report, which is expected to have an impact on market sentiment and monetary policy.
| SMA (1D) | Slightly Rising |
|
| RSI (1D) | Slightly Rising |
|
| MACD (1D) | Slightly Falling | |
Closing statement:Overall, the European stock markets are looking to open higher on Friday, with the DAX40 and other major indices gaining support from positive earnings and awaiting economic data from the U.S. and Europe.