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27.06.2023 Market Report


EUR/USD is holding ground just above 1.0900, as bulls look to a bunch of ECB policymakers and the US data to defend the previous rebound in Tuesday’s Asian session. The pair is on the front foot amid a sluggish US Dollar performance even though markets stay risk-averse. 


The GBP/USD pair continues to show some resilience below the 1.2700 round-figure mark and regains some positive traction. Spot prices, however, lack any follow-through buying or bullish conviction and currently trade around the 1.2720-1.2725 region, up less than 0.10% for the day.


The USD/JPY pair extends its sideways consolidative price move for the second successive day on Tuesday and oscillates in a narrow band through the Asian session. Spot prices, however, remain well within the striking distance of the YTD peak touched last Friday and currently trade just below mid-143.00s. The Japanese Yen (JPY) continues to draw some support from speculations that authorities will respond to any excessive moves in the currency market. Apart from this, worries about a global economic downturn benefit the JPY’s relative safe-haven status, which, along with subdued US Dollar (USD) demand, acts as a headwind for the USD/JPY pair. The downside, however, remains cushioned in the wake of a big divergence in the monetary policy stance adopted by the Bank of Japan (BoJ) and other major central banks, including the Federal Reserve (Fed).


AUD/USD skates on thin ice around 0.6670-80 as it tries to push back the bears amid a sluggish week, so far, due to the lack of major data/events, as well as mixed risk catalysts. Also restricting the Aussie pair’s moves on early Tuesday in Asia is the cautious mood ahead of the US Durable Goods Orders for May, as well as Wednesday’s Monthly Consumer Price Index (CPI) for Australia.


The NZD/USD pair has jumped to near 0.6190 in the Asian session. The Kiwi asset is expected to recapture the of 0.6200 as the US Dollar Index (DXY) has continued its correction for the second trading session.

S&P500 futures have added significant gains in Asia, portraying a recovery in the risk appetite of the market participants. US equities witnessed a steep fall on Tuesday as investors were cautious ahead of the quarterly result season which will start sooner. A sell-off in US equities was propelled by weakness in technology stocks as investors are anticipating poor guidance from them.


The USD/CAD pair remains under some selling pressure for the second successive day on Tuesday and drops to the 1.3120 area, or its lowest level since September 2022 during the Asian session. Crude Oil prices edge higher amid worries about potential supply disruptions, led by political instability in Russia, which, to a larger extent, help offset concerns that a global economic downturn will dent fuel demand. This, in turn, is seen underpinning the commodity-linked Loonie, which, along with a modest US Dollar (USD) weakness, exerts some downward pressure on the USD/CAD pair.


The USD/CHF pair struggles to capitalize on the previous day’s goodish rebound from the vicinity of the 0.8900 mark and meets with a fresh supply during the Asian session on Tuesday. Spot prices currently trade around the 0.8950 area.


Oil prices gained on Tuesday for the second day in a row following unstable political developments in Russia and concerns about global demand. Brent crude rose 0.5% to $74.71/barrel and WTI Futures traded at $69.75 a barrel. Natural Gas Futures advanced 0.52%.


Gold clings to mild gains around the intraday high as it prints a three-day winning streak amid cautiously optimistic markets. The precious metal cheers the US Dollar’s positioning for the key data, as well as the risk-positive headlines from China, amid dicey trading hours on Tuesday.

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