June 30, 2021 - 04:38 PM 484 views
US building PMI numbers for June were confirmed at record high levels yesterday. The makers, however, are facing shortfalls of raw materials and skilled workers. This creates significant inflationary pressures. Admitting this, the Fed officials have admitted that a period of high-rising prices could be longer than they had expected.
More ‘Fed speak’ is scheduled for today. Traders are now waiting for the core PCE and personal income and passing data releases on Friday to get more data on rising prices pressures. By reading further, you agree with our disclaimer at the end of this report and admit that we do not provide investment advice.
On this side of the pool, the Eurozone Manufacturing PMI data came in at 63.1 (62.4 expected). This corresponds to the fastest pace of business enlargement in 15 years.
This afternoon European time the Bank of England releases its Monetary Policy Summary which is expected to give guidance on the central bank’s thinking on rising prices expectations. The BOE is likely to follow the BOC and the Fed as they are starting to move away from ultra - cooperative monetary policy.
The 10-yr US Treasury Bond returns moved slightly higher (1.3 basis points) to 1.48%. Gold (+0.34%) futures mobilized to a minor resistance intraday, but sellers forced the marketplace down. Silver (+0.98%) showed relative strength, while trading in WTI crude (+0.34%) futures was similar to gold.
The price of oil rallied intraday, but then failed to maintain the higher levels, rooting with a small gain and producing a bearish (shooting star) candle.
Oil has been drifting strongly higher lately, but is now showing the first signs of the upside impulse decreasing.
This could lead to a replacement in the 69.50 – 70.20 range. This is where a recent reactionary low, the SMA(20) and the 23.6 substitution level coincide. Therefore, we expect this to be a key price zone. A decisive break below the level would indicate the 66.50 – 67.70 zone could come into play, while a successful test of the 69.50 – 70.20 range would be likely to take the market to the current price levels.
NZDUSD has been mobilizing against the USD for three days in a row after the sizeable drop that followed the Fed’s acceptance that the explosion pressures might not be that passing after all.
The current uptrend in intraday timeframes might provide possibilities to agile traders, while the resistance area between 0.7115 – 0.7130 (two recently busted support levels and the 38.2% replacement level) is likely to be an area market players focus on as a zone for profit-taking.
This could make the market weak enough to stop the gathering and push the pair again towards the most recent low at 0.6920.