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The UK begins a 10-day mourning period for 7-decade Queen Elizabeth II who passed away at the age of 96 on Thursday. The Dollar faces a broad selloff after a steep rise to a 20-year high. Chinese inflation eases to 2.5% on a yearly basis. The EU holds an emergency meeting in Brussels to discuss the energy crisis. Fed officials Waller and George will be speaking later in the day.
EURUSD rose +0.95% above parity ahead of ECB’s President Christine Lagarde’s speech. The Euro got boosted by a hawkish ECB on Thursday after delivering a 75bps rate hike to fight inflation. This along with hawkish comments from ECB officials who supported further hikes to tame inflation gave an upper hand to the Euro. Fed’s Powell showed his commitment to fighting inflation yesterday at the CATO Institute, but his comments failed to boost the dollar. The pair still needs to trade above 1.0200 resistance to strengthen a bullish outlook. However, a slide to 0.9800 may be witnessed in the short term.
GBPJPY dipped by -0.65% on the day as the UK mourns their Queen. The Yen found some footing on Kuroda’s intervention remarks against the current Forex moves. The Japanese GDP yesterday showed a healthier economy for the second quarter printing 3.5% vs 2.9% surveyed for the yearly readings and 0.9% against 0.7% expected on a quarterly basis. The pair got rejected at 166.20 resistance and dropped towards 164.00. Further down, the pair may seek 163.50 and 163.00 in the near term.
AUDCAD surged higher in the mid-European session by +0.81% ahead of Canada’s employment data. The number of people employed in the month of August is set to rise to 15K from -30.6K however the unemployment rate is expected to rise by 0.1% to 5.0%. The RBA on Tuesday hiked its rates by 50bps to 2.35% helping the AUD gain some ground. The pair rose from 0.8820 to 0.8920 and a further rally may give bulls 0.9000.
European stocks pocketed some gains to end the week on a positive note, recovering last week’s losses. The FTSE100 gained +1.58% establishing a new high at 7380 in 6 days. A move above may give bulls 7400 and 7500. CAC 40 soared by +1.93% from 6100 to 6250. Another rally may be challenged by 6315. DAX was up +1.64% breaching the 13000 mark and retesting the 13130 support-turned-resistance.
US stock futures moved higher to end the week capitalizing on broad USD weakness. The DJIA futures rose by +0.54% from 31750 intraday support to 32000 psychological resistance. The key levels to watch are 32400 and 32800. S&P 500 futures ticked up by +0.67% moving away from the 4000 level. A bullish cap is seen at 4080 in the near term. Nasdaq100 futures gained +0.82% trading between 12320 support and 12500 resistance.
BTCUSD gained over +8% on the day after ticking slightly below $18 800, a 3-months low. The leg up may still face a challenge at $22 000 before staging a bullish rally. Bears may however seek to retest $20 500 in the near term.
