- June 8, 2021
- Posted by: Trading
- Category: Market Overview
- Markets await inflation data for clues ahead of Fed response
- US Dollar, Treasuries rally
- Gold falters
Despite the expectation that the Biden Administration’s spending plan will provoke a steep hike in inflation, futures on the , and were only moderately higher in trading on Tuesday, while futures were marginally lower. European stocks were also trading in the green, slightly below record highs.
Bitcoin slid to a four-and-a-half month low.
Global Financial Affairs
The Index climbed slightly with havens like utilities. Automakers dropped 0.8% after a six-day rally, which had driven the pan-European benchmark to a record high. German data revealed that Europe’s largest economy’s fell short of expectations, providing further evidence of supply bottlenecks and semiconductor shortages causing a slower than expected recovery in Europe’s steam engine economy.
Swiss drug maker Lonza (SIX:) gained over 5%, taking the stock to an all-time high, after Goldman Sachs upgraded the stock to “buy,” while British American Tobacco (LON:) rose as much as 2.5%, before paring the gain to 1.6%, after raising its annual revenue growth forecast.
Traders in Asia experienced a roller coaster as early gains reversed. China’s (-0.5%) underperformed, while Australia’s (+0.1%) provided the best results.
Focus was on yields, with the rate falling back below 1.6%, though it pared losses and settled at 1.57% as of the time of writing. All eyes are on the data which potentially may influence the Fed’s decision on tapering its stimulus.
Yields may have provided a downside breakout to a symmetrical triangle. After their inability to traverse the 50 DMA, rates are struggling to remain abreast of the 100 DMA, before they fall back toward their uptrend line—at 1.25% where the 200 DMA guards—or even lower to 1.00%.
Taking its cue from Treasuries, the advanced.
The greenback found support at the bottom of a rounding bottom, whose completion would indicate a return to the March highs, which were cut off with a bearish wedge. However, we have been arguing that the price decline from the March 2020 peak was in the shape of a bullish wedge. If we were right, the price should return to a medium-term uptrend. If the price falls below 89.00 we turn wholly bearish.
wiped out yesterday’s gains on dollar strength.
Gold remains within a rising channel, after confirming support of the 200 DMA, which previously realigned with the top of a massive falling channel since the 2020 record top.
is falling for the fourth out of five days after former President Donald Trump—who thinks running for a House seat in 2022 is a “very interesting” idea—warned that Bitcoin is a “scam against the dollar.”
Bitcoin is still suffering from persistent tightening regulations in China and fell significantly after Tesla’s (NASDAQ:) about-face in May on accepting the digital coin as payment for its cars.
Bitcoin extended the downside breakout of a bearish pennant, suggesting the crypto will retest the $30,000 level, challenging our recent bullish call.
extended a decline, losing some momentum after hitting $70 a barrel in New York for the first time in over two years.
We consider the second-day decline is part of a return-move, before prices take off, having completed a bullish triangle.
- The Bank of Canada announces its interest rate on Wednesday.
- Iran nuclear deal talks reconvene in Vienna on Thursday.
- Group of Seven (G7) leaders’ summit begins in Cornwall, England on Friday.
- The STOXX 600 rose 0.1%
- Futures on the S&P 500 were little changed
- Futures on the NASDAQ 100 were little changed
- Futures on the Dow Jones Industrial Average fell 0.1%
- The Index fell 0.2%
- The fell 0.2%
- The Dollar Index rose 0.2%
- The fell 0.1% to $1.2173
- The increased 0.2% to 109.44 per dollar
- The was up 0.2% at 6.39636 per dollar
- The fell 0.3% to $1.4137
- The yield on 10-year Treasuries was little changed at 1.56%
- Germany’s yield was little changed at -0.20%
- Britain’s yield was little changed at 0.80%
- fell 0.7% to $71 a barrel
- fell 0.3% to $1,894 an ounce