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Midday Update
Markets were at ease during Friday morning, and it seems investors are digesting central banks’ policy direction during this current inflationary period amid a war cloud cover.
The diplomatic meetings between Moscow and Kyiv draw optimism after Russian President positive remarks on the talks although investors remain on the edge. ECB leaders’ summit ends today and there will be a press conference later in the New York session.
The Dollar index was slightly down during the European session opening after bulls lost steam at 0.9870, near-term resistance. The index got a boost on Thursday afternoon from the positive US Inflation data currently at a 40-year high reviving prospects of an aggressive rate hike from the Fed policy meeting scheduled for next week.
Price is currently trading above the 50-day moving average as bulls attempt to reclaim the 99.00 area, however, a failure to break above that area may cause the dollar to trade sideways ahead of the FOMC policy meeting next week.
USDCAD is currently trading sideways ahead of important Job Data from Canada due for release later in New York Session. The price is currently sitting at 1.2750 support which coincides with the 4-hour chart 50-day moving average. A break below that support could see the pair retesting 1.2700 support in the near term.
The GBPNZD is up +0.44% as the Pound gets a boost from positive GDP data (YoY and MoM) while manufacturing figures beat expectations. The pair bounced off weekly support at 1.9057 and bulls have managed to claim 1.9139 area as they target further upside. The trend remains capped by 1.92000 near-term psychological resistance and a break above that could lead to a 1.93000 area.
The AUDUSD rebound was short-lived due to the strengthening dollar and commodity prices which are sliding lower. The pair edged lower in the Asian session after rising for 2 consecutive days, bulls shying away from the 0.7367 area. The bullish outlook is fading away as price crosses down the 50-day moving average on a 1-hour chart leaving room for bears to target 0.7285 near-term support.
European equities were up during the European session as the Russian president makes a comment on positive feedback from diplomatic talks although there is no clarity on the progress so far.
The CAC40 spiked up 2% as bulls attempted to break the 6455.00 near-term resistance. The FTSE soared +1.60% and bulls remain challenged by 7236 resistance and a breach of that area may give more room to the upside. Dax was up +3.45% and broke above weekly high at 13850 near-term resistance.
On commodity markets, US WTI shaded off some of its earlier gains after hitting $109 as bears target 104, Wednesday low. Crude oil prices continue to drop after remarks from OPEC+ members pushing for increased supply. Gold is trading below $2000/oz at $1975 and a breach below that price could pave way for further downside toward $1917.00 near-term support.
Bitcoin is up 1% after bouncing off the $3823.00 near-term low, however, bulls need to break above $40000 near-term resistance to gain further upside.
