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Gold Price Weakens, EUR/USD Eyes Testing Key Support Level, What’s Next?

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Miguel A. Rodriguez
Miguel A. Rodriguez
05 noviembre 2022
Concerns over the coronavirus increasing numbers weigh on market sentiment and sends equities and risk currencies lower. What Moves markets today?

Equities 

Most global stock markets flashed in the red on Monday and Asian equities extended losses on Tuesday due to coronavirus fears as full restriction measures could be reinstated in Europe. As usual, the aviation and hospitality sectors would take the bigger hit as reports talked that the UK PM would encourage Britons to return to work from home. 

The Fed Chair assured on Monday that the Central bank remained committed to doing “all that it takes” to ensure that the recovery will be as strong as possible. Powell will testify before the US congress for three days where he is expected to repeat what he said in the latest Fed policy meeting of keeping on low-interest rates, tolerating higher inflation levels, and targeting better employment rates. Additionally, Powell may repeat his invitation to politicians to break the current deadlock and help the Us economy with another round of fiscal stimulus. 

Stock Market

Change %

S&P 500

- 0.9%

Dow Jones

-1.7%

NASDQ

+0.7%

Japan 225

-1.2%

DAX 30

-3.3%

FTSI 100

-2.6%

CAC 40

-2.6%


Currencies 

The US dollar benefited from weaker risk-on sentiment due to the coronavirus developments and the delay in US fiscal stimulus. The safe-haven currency rallied on Monday to a six-week high against a basket of currencies.

The outlook of the US Dollar index remains neutral while below 94.04. On the other hand, EUR/USD would change its neutral outlook if closes below 1.1713. 

GBP/USD retreated on Monday due to a stronger US dollar and lower chances of the EU-UK trade deal. A close below 1.2773 may resume bearish price action.  

Commodities 

The oil price slipped on Tuesday as the tropical storm in Mexico Gulf lost strength and concerns increase over fuel demand due to the persisting surge of coronavirus cases worldwide. Brent oil fell on Tuesday by 0.9% while, US Crude has lost 1.3% of its value. 

The Gold price fell on Monday to a multi-week low at $1,882 due to the US dollar rally and closed below $1,921 changing the precious metal outlook to negative. XAU/USD may continue falling towards $1,859o/z. 

Looking Ahead 

Markets eyes will be on the Eurozone consumer confidence number for September and the US home sales for July and they expect Fed member Evan’s speech and afterwards, markets will tune in the Powell testimony before the US congress. 


Esta información/estudio preparada por Miguel A. Rodriguez  no tiene en cuenta los objetivos específicos de inversión, la situación financiera o las necesidades particulares de una persona. El analista de estudios es, principalmente, responsable del contenido de este informe de estudio, en parte o en su totalidad, certifica que los puntos de vista sobre las compañías y sus valores expresados en este informe reflejan con exactitud sus puntos de vista personales, y como consecuencia, toda persona que actúe basándose en ellos lo hace bajo su propio riesgo.El estudio proporcionado no constituye los puntos de vista de KW Investments Ltd, ni es una invitación a invertir con KW Investments Ltd El analista de estudios certifica, además, que ninguna parte de su remuneración ha sido, es o será directa o indirectamente relacionada con recomendaciones o puntos de vista específicos expresados en este informe.El analista de estudios no está contratado por KW Investments Ltd Le animamos a buscar asesoramiento con un consejero financiero independiente con respecto a la idoneidad de la inversión, en virtud de otra participación separada, cuando considere oportuno que es conforme con sus objetivos específicos de inversión, su situación financiera o, sus necesidades financieras particulares antes de comprometerse a invertir..Las leyes de la República de Seychelles rigen cualquier reclamación relacionada o que surja por el contenido de la información/análisis proporcionado.

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Miguel A. Rodriguez
Miguel A. Rodriguez
Autor financiero

Miguel worked for major financial institutions such as Banco Santander, and Banco Central-Hispano. He is a published author of currency trading books.