Daily Analysis: Dollar Falls, Gold Jumps on Dismal Data before the FED
Wednesday Market Recap
|Asset||Current Value||Daily Change|
|WTI Crude Oil||44.76||-3.72%|
The usual pre-Fed trading fell apart today as the much worse than expected US CPI and Retail Sales reports caused turmoil before tonight’s important announcements. While a rate hike is still more than likely today, the continued deterioration of the consumer-related indicators could push the central banks towards a more cautious outlook. The Dollar got hit hard after the releases, while the shooting Virginia also triggered safe-haven buying in early trading. The Japanese Yen and gold were heavily bought, with the Japanese currency rising to a two-month high against the Greenback.
Gold, 4-Hour Chart Analysis
The Euro also gained ground on the Dollar, while the Great British Pound rallied has been weak after yesterday’s jump. Wage growth was dismal in the UK according to the Employment Report released today, and that weighed on the currency together with the risk-off sentiment. The Canadian Dollar and the Australian Dollar are also strong today, despite the mixed performance of the major commodities, as the Dollar weakness lifted the other majors. Oil and Copper are both lower today, as weakness seems to be returning to the Chinese market. The S&P 500 and the DAX, on the other hand, hit all-time highs overnight, with the NASDAQ still lagging following Friday’s flash correction, underlying the mixed nature of the current market action.
The coins are experiencing a sharp decline today in US trading, led by BTC once again, with Ethereum also following in lower this time around. With the long-term picture still showing overbought conditions, more corrective action wouldn’t surprise us. Ripple jumped higher today in early trading topping the $0.30 level before the broad decline began in the crypto-segment. All of the major are trading lower today, with Stratis, NEM, and Litecoin showing relative strength so far.
Bitcoin, 4-Hour Chart Analysis
The Chinese index failed to follow through following the rebound off the 3000 level in May and it traded in a bearish consolidation since then. The 3150 level acted as resistance lately, with the 3115 level serving as primary support right now. A move below that level would warn of further weakness ahead, while bulls need a break-out above 3150, for the short-term rally to continue. The MACD indicator is also on the verge of a bearish cross.
Key Economic Releases on Wednesday
|14:30||US||Core Retail Sales||-0.3%||0.2%||0.3%|
|16:30||US||Crude Oil Inventories||-1.7 mill||-2.3 mill||3.3 mill|
|14:30||US||Fed Interest Rate Decision||1.25%||1.25%||1%|
|20:00||US||Fed Monetary Statement||–||–||–|
Key Economic Releases on Thursday
|9:30||SWITZERLAND||SNB Monetary Statement||–||–|
|13:00||UK||BOE Monetary Statement||–||–|
|14:30||US||Philly Fed Index||25.5||38.8|
|14:30||US||Initial Jobless Claims||241,000||245,000|