• Prior 59.99k; revised to 60.13k
• Net consumer credit £1.2 billion
• Prior £1.5 billion

On net, UK individuals borrowed £2.7 billion of mortgage debt in June. Meanwhile, the annual growth rate for net mortgage lending rose to 0.5% in June – keeping the positive trend in the last few months.

This article was written by Justin Low at www.forexlive.com.

• Domestic sight deposits CHF 449.5 bn vs CHF 452.9 bn prior

Swiss sight deposits fell in the past week but remains in the range of what we have been seeing in the last few months. So, nothing quite out of the ordinary here.

This article was written by Justin Low at www.forexlive.com.

• Eurostoxx +0.2%
• Germany DAX +0.4%
• France CAC 40 -0.1%
• UK FTSE +0.5%
• Spain IBEX +0.6%
• Italy FTSE MIB +0.7%

French stocks are the ones lagging, keeping with a more cautious mood after last weeks’ drop. US futures are keeping higher though, with S&P 500 futures seen up 0.4% on the day. So, the overall risk mood is in a better spot at least. But again, just be mindful of key earnings on the calendar this week. In particular, four of the dubbed Magnificent Seven will be reporting earnings alongside a number of key firms as well.

This article was written by Justin Low at www.forexlive.com.

• Cannot simply overlook the impact a weak yen and rising prices are having on consumption
• Important for government, BOJ to guide policy with a close eye on recent yen declines

Is this a bit of a suggestion of what they want the BOJ to be doing later this week?

This article was written by Justin Low at www.forexlive.com.

Global Markets:

•  Asian Stock Markets : Nikkei up 2.29%, Shanghai Composite down 0.05%, Hang Seng up 1.71% ASX up 0.80%
• Commodities : Gold at $2436.35 (0.37%), Silver at $28.18 (0.45%), Brent Oil at $80.63 (0.57%), WTI Oil at $77.49 (0.48%)
• Rates : US 10-year yield at 4.187, UK 10-year yield at 4.103, Germany 10-year yield at 2.403

News & Data:

• (USD) Core PCE Price Index m/m  0.2% vs 0.2% expected
• (USD) Personal Income m/m  0.2% vs 0.4% expected
• (USD) Personal Spending m/m  0.3% vs 0.3% expected

Markets Update:

Asia-Pacific markets surged on Monday, led by Japan’s Nikkei 225, following a key U.S. inflation report that raised hopes for an interest rate cut. The U.S. June personal consumption expenditures price index increased by 0.1% month-on-month and 2.5% year-on-year, aligning with economists’ estimates from a Dow Jones poll. The Nikkei 225 rose by 2.26%, and the Topix increased by 2.02%. If the Nikkei maintains its gains, it will end its eight-day losing streak. The Japanese yen also strengthened by 0.18% against the dollar, trading at 153.44.

Mitsubishi Motors was a top performer, jumping over 6% after reports indicated it would join the Honda-Nissan alliance to standardize in-vehicle software. This alliance, which sells over 8 million vehicles globally, aims to consolidate the domestic market into two main groups: Toyota Motor Group and the Honda-Nissan-Mitsubishi alliance. Conversely, shares of Eisai plummeted 13% after the European Medicines Agency did not approve its Leqembi treatment for Alzheimer’s disease, marking it the biggest laggard among the 10 declining Nikkei 225 stocks during a broad rally.

The Bank of Japan’s monetary policy meeting, starting July 30, is this week’s highlight. A Reuters poll predicts the central bank will raise rates by 10 basis points to 0.1%. ING analysts expect a 15 basis point hike and a simultaneous reduction in the bond-buying program, citing economic recovery and solid wage growth. Other regional data include China’s July PMI and Australia’s upcoming inflation data ahead of its Aug. 6 policy meeting.

South Korea’s Kospi rose by 1.3%, while the Kosdaq increased by 0.59%. Hong Kong’s Hang Seng index climbed 1.6%, but China’s CSI 300 fell 0.3% due to declining utilities stocks. Australia’s S&P/ASX 200 rose 0.80%, and Taiwan’s Weighted Index rebounded 1.04%. In the U.S., the Dow Jones Industrial Average gained 1.64%, the S&P 500 climbed 1.11%, and the Nasdaq Composite increased by 1.03% on Friday, driven by oversold sentiment, a robust GDP report, and expectations of Federal Reserve rate cuts, according to CFRA Research’s Sam Stovall.

Upcoming Events: 

• 11:30 PM GMT – JPY Unemployment Rate

The post Monday 29th July 2024: Asia-Pacific Markets Surge Led by Nikkei 225 Following U.S. Inflation Report first appeared on IC Markets | Official Blog.

IC Markets Europe Fundamental Forecast | 29 July 2024

What happened in the Asia session?

The dollar index (DXY) briefly dipped under 104.20 before reversing to edge higher towards 104.30 while spot prices for gold attempted to climb above the threshold of $2,400/oz. WTI oil remained capped under $79 per barrel as overhead pressures persisted for this commodity.

What does it mean for the Europe & US sessions?

With not a single major economic news release lined up for the second half of the day, trading activity could remain subdued once again. With three major central bank announcements scheduled this week along with U.S. jobs data, markets could tread cautiously for the first couple of trading days before springing into life.

The Dollar Index (DXY)

Key news events today

No major news events.

What can we expect from DXY today?

The DXY ranged within an extremely narrow band of 104.08 and 104.55 last week before closing at 104.32 on Friday. It opened this morning to rise towards 104.40 before reversing to fall and dip under 104.20 – these are the support and resistance levels for today.

Support: 103.70

Resistance: 104.50

Central Bank Notes:

• The Federal Funds Rate target range remained unchanged at 5.25% to 5.50% for the seventh meeting in a row.
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and judges that the risks to achieving its employment and inflation goals have moved toward better balance over the past year.
• The economic outlook is uncertain, and the Committee remains highly attentive to inflation risks. Inflation has eased over the past year but remains elevated and in recent months, there has been modest further progress toward the Committee’s 2% inflation objective.
• Recent indicators suggest that economic activity has continued to expand at a solid pace while job gains have remained strong, and the unemployment rate has remained low.
• In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks and does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%.
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
• In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities. Beginning in June, the Committee will slow the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion.
• The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities.
• Next meeting runs from 30 to 31 July 2024.

Next 24 Hours Bias

Weak Bearish

Gold (XAU)

Key news events today

No major news events.

What can we expect from Gold today?

Spot prices for gold tumbled over 2% over the last couple of weeks as it dropped as low as $2,353.14/oz on Thursday before retracing higher to close at $2,387.34/oz on Friday. This precious metal rose towards $2,400.00/oz at the beginning of the Asia session – these are the support and resistance levels for today.

Support: 2,350.00

Resistance: 2,430.00

Next 24 Hours Bias

Weak Bullish

The Australian Dollar (AUD)

Key news events today

No major news events.

What can we expect from AUD today?

The Aussie shed 3.3% over the last couple of weeks as it dived from 0.6783 in mid-July to as low as 0.6513 on Thursday before retracing to climb higher and close at 0.6545 on Friday. This currency pair was trading around 0.6560 as Asian markets came online – these are the support and resistance levels for today.

Support: 0.6465

Resistance: 0.6630

Central Bank Notes:

• The RBA kept the cash rate target unchanged at 4.35%, marking the ninth pause out of the last ten board meetings.
• Over the year to April, the monthly CPI indicator rose by 3.6% in headline terms, and by 4.1% excluding volatile items and holiday travel, which was similar to its pace in December 2023.
• The central forecasts published in May were for inflation to return to the target range of 2–3% in the second half of 2025 and to the midpoint in 2026 while there have been indications that momentum in economic activity is weak, including slow growth in GDP, a rise in the unemployment rate and slower-than-expected wages growth.
• Inflation is easing but has been doing so more slowly than previously expected and it remains high and the Board expects that it will be some time yet before inflation is sustainably in the target range.
• The path of interest rates that will best ensure that inflation returns to target in a reasonable timeframe remains uncertain and the Board is not ruling anything in or out.
• Next meeting is on 6 August 2024.

Next 24 Hours Bias

Weak Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

Significant weakness in the Kiwi has caused it to decline nearly 4.1% over the past three weeks as it hit a low of 0.5880 on Thursday before stabilizing around this level to close at 0.5887 on Friday. Overhead pressures remain and further downside can be expected for the Kiwi – these are the support and resistance levels for today.

Support: 0.5800

Resistance: 0.5980

Central Bank Notes:

• The Monetary Policy Committee kept the OCR unchanged at 5.50% for the eighth meeting in a row and agreed that restrictive monetary policy is reducing domestic demand and consumer price inflation.
• The Committee is confident that inflation will return to within its 1-3% target range over the second half of 2024.
• The decline in inflation reflects receding domestic pricing pressures, as well as lower inflation for goods and services imported into New Zealand while recent monthly Selected Price Indexes suggest weakening in some of the more volatile inflation components, while survey measures of cost pressures and pricing intentions have continued to decline.
• Non-performing bank loans and corporate insolvencies have increased from low levels in line with declining economic activity while bank credit growth also remains very subdued, in line with weakness in the domestic economy and low business and consumer confidence.
• Next meeting is on 14 August 2024.

Next 24 Hours Bias

Weak Bullish

The Japanese Yen (JPY)

Key news events today

No major news events.

What can we expect from JPY today?

The yen strengthened significantly over the last three weeks causing USD/JPY to dive over 4.1%, losing almost 650 pips in the process to close at 153.80 on Friday. This currency pair opened around 153.64 at the beginning of the Asia session – these are the support and resistance levels for today.

Support: 152.00

Resistance: 157.90

Central Bank Notes:

• The Bank considers that the policy framework of Quantitative and Qualitative Monetary Easing (QQE) with Yield Curve Control and the negative interest rate policy to date have fulfilled their roles. With the price stability target of 2%, it will conduct monetary policy as appropriate, guiding the short-term interest rate as a primary policy tool.
• The Bank of Japan decided on the following measures:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0 to 0.1% while continuing its Japanese government bonds (JGB) purchases in accordance with the decisions made at the March 2024 MPM.
  2. The Bank decided, by an 8-1 majority vote, that it would reduce its purchase amount of JGBs thereafter to ensure that long-term interest rates would be formed more freely in financial markets.
• Underlying CPI inflation is expected to increase gradually, since it is projected that the output gap will improve and that medium- to long-term inflation expectations will rise with a virtuous cycle between wages and prices continuing to intensify.
• In the second half of the projection period of the April 2024 Outlook for Economic Activity and Prices (Outlook Report), it is likely to be at a level that is generally consistent with the price stability target of 2%.
• The year-on-year rate of increase in the CPI (all items less fresh food), has been in the range of 2.0-2.5% recently, as services prices have continued to rise moderately, reflecting factors such as wage increases, although the effects of a pass-through to consumer prices of cost increases led by the past rise in import prices have waned. Inflation expectations have risen moderately.
• Japan’s economy has recovered moderately, although some weakness has been seen in part while is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
• Next meeting is on 31 July 2024.

Next 24 Hours Bias

Weak Bearish

The Euro (EUR)

Key news events today

No major news events.

What can we expect from EUR today?

The Euro closed at 1.0855 last Friday and it opened this morning to rise towards 1.0870 – these are the support and resistance levels for today.

Support: 1.0800

Resistance: 1.0950

Central Bank Notes:

• The Governing Council today decided to keep the three key ECB interest rates unchanged in July, following a 25 basis points cut in June.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 4.25%, 4.50% and 3.75% respectively.
• Monetary policy is keeping financing conditions restrictive but at the same time, domestic price pressures are still high, services inflation is elevated and headline inflation is likely to remain above the target well into next year.
• While some measures of underlying inflation ticked up in May owing to one-off factors, most measures were either stable or edged down in June.
• The incoming information indicates that the euro area economy grew in the second quarter, but likely at a slower pace than in the first quarter.
• Services continue to lead the recovery, while industrial production and goods exports have been weak – investment indicators point to muted growth in 2024, amid heightened uncertainty.
• The Eurosystem no longer reinvests all of the principal payments from maturing securities purchased under the pandemic emergency purchase programme (PEPP), reducing the PEPP portfolio by €7.5 billion per month on average and the Governing Council intends to discontinue reinvestments under the PEPP at the end of 2024.
• The Council is determined to ensure that inflation returns to its 2% medium-term target in a timely manner and will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim and is not pre-committing to a particular rate path.
• Next meeting is on 12 September 2024.

Next 24 Hours Bias

Weak Bullish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

Demand for the franc picked up in July as USD/CHF tumbled nearly 1.6% to lose almost 150 pips in the process. This currency pair was trading around 0.8825 and was sliding lower at the beginning of the Asia session – these are the support and resistance levels for today.

Support: 0.8730

Resistance: 0.8915

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 25 basis points for the second consecutive meeting, going from 1.50% to 1.25% in June.
• The underlying inflationary pressure has decreased again compared to the previous quarter but inflation had risen slightly since the last monetary policy assessment, and stood at 1.4% in May.
• The inflation forecast puts average annual inflation at 1.3% for 2024, 1.1% for 2025 and 1.0% for 2026, based on the assumption that the SNB policy rate is 1.25% over the entire forecast horizon.
• Swiss GDP growth was moderate in the first quarter of 2024 with the services sector continuing to expand, while manufacturing stagnated.
• Growth is likely to remain moderate in Switzerland in the coming quarters as the SNB anticipates GDP growth of around 1% this year while currently expecting growth of around 1.5% for 2025.
• Next meeting is on 26 September 2024.

Next 24 Hours Bias

Weak Bullish

The Pound (GBP)

Key news events today

No major news events.

What can we expect from GBP today?

Cable dropped 1% over the last couple of weeks to close at 1.2865 on Friday. This currency pair rose towards 1.2890 as Asian markets came online and is expected to edge lower as the day progresses – these are the support and resistance levels for today.

Support: 1.2800

Resistance: 1.2950

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 7-to-2 to maintain its Official Bank Rate at 5.25% for the seventh consecutive meeting.
• Two members preferred to reduce the Bank Rate by 25 basis points to 5%, an increase of one from the previous meeting.
• Twelve-month CPI inflation fell to 2.0% in May from 3.2% in March, close to the May Monetary Policy Report projection. CPI inflation is expected to rise slightly in the second half of this year, as declines in energy prices last year fall out of the annual comparison.
• Reflecting a margin of slack in the economy, CPI inflation had been projected to be 1.9% in two years’ time and 1.6% in three years.
• UK GDP appears to have grown more strongly than expected during the first half of this year. Business surveys, however, remain consistent with a slower pace of underlying growth, of around 0.25% per quarter.
• UK real GDP had increased by 0.6% in 2024 Q1, 0.2% stronger than had been expected in the May Monetary Policy Report and Bank staff now expect GDP growth of 0.5% in 2024 Q2 as a whole, stronger than the 0.2% rate that had been incorporated in the May Report.
• The MPC remains prepared to adjust monetary policy as warranted by economic data to return inflation to the 2% target sustainably. It will therefore continue to monitor closely indications of persistent inflationary pressures and resilience in the economy as a whole, including a range of measures of the underlying tightness of labour market conditions, wage growth and services price inflation.
• Next meeting is on 1 August 2024.

Next 24 Hours Bias

Weak Bullish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

Recent weakness in the Loonie has propelled USD/CAD higher as it rose from 1.3600 to a high of 1.3850 before closing at 1.3835 Friday, gaining almost 1.4% in the process. This currency pair was trading around 1.3820 at the beginning of the Asia session and looks set to drift lower today – these are the support and resistance levels for today.

Support: 1.3780

Resistance: 1.3850

Central Bank Notes:

• The Bank of Canada reduced its target for the overnight rate by 25 basis points to 4.50% while continuing its policy of balance sheet normalization.
• Canada’s economic growth likely picked up to about 1.5% through the first half of this year and is forecasted to increase in the second half of 2024 and through 2025.
• Overall, the Bank forecasts GDP growth of 1.2% in 2024, 2.1% in 2025, and 2.4% in 2026, reflecting stronger exports and a recovery in household spending and business investment as borrowing costs ease.
• CPI inflation moderated to 2.7% in June after increasing in May as broad inflationary pressures eased.
• The Bank’s preferred measures of core inflation have been below 3% for several months and the breadth of price increases across components of the CPI is now near its historical norm but shelter price inflation remains high, driven by rent and mortgage interest costs, and is still the biggest contributor to total inflation.
• These preferred measures of core inflation are expected to slow to about 2.5% in the second half of 2024 and ease gradually through 2025 and CPI inflation is expected to come down below core inflation in the second half of this year, largely because of base year effects on gasoline prices.
• There are signs of slack in the labour market with the unemployment rate rising to 6.4%, as employment continues to grow more slowly than the labour force and job seekers taking longer to find work. Wage growth is showing some signs of moderation, but remains elevated.
• The Governing Council’s future monetary policy decisions will be guided by incoming information and assessment of their implications for the inflation outlook.
• Recent data has increased the council’s confidence that inflation will continue to move towards the 2% target. Nonetheless, risks to the inflation outlook remain.
• Next meeting is on 4 September 2024.

Next 24 Hours Bias

Weak Bearish

Oil

Key news events today

No major news events.

What can we expect from Oil today?

Prices for crude oil fell for three straight weeks, a feat last observed at the end of May – WTI oil dived over 8% as it closed at $77.75 per barrel on Friday. This benchmark gapped higher to open at $78.49 but overhead pressures remain for this commodity – these are the support and resistance levels for today.

Support: 77.37

Resistance: 80.81

Next 24 Hours Bias

Weak Bearish

The post IC Markets Europe Fundamental Forecast | 29 July 2024 first appeared on IC Markets | Official Blog.

And for now, the volatility in the yen continues to persist as such. USD/JPY itself touched a low of 153.01 earlier before keeping around 153.40 levels now. And the high in Asia trading was at 154.35, so that is a wide range already seen on the day. But the technical picture remains little changed overall:

The downside momentum is still largely holding with key support still seen closer to the May low at 151.85 currently. Then, there is also the 200-day moving average (blue line) at 151.60 to consider.

For now, the near-term bias stays more bearish as well with price action resting below the 100-hour moving average of 154.29. That is keeping sellers in near-term control.

The BOJ is the big event to watch out for this week. The central bank is set to announce tapering of its bond purchases, likely at a more gradual pace to start with.

As for a rate hike, it is still very much up in the air. Traders have been rather wary of that in the last week or so, especially so after this report: BOJ rate hike next week reportedly to be a “close call”

Still, I’d argue that we are setting up for a sell the fact play here on the yen once the dust settles from the BOJ. If not through the dollar, then arguably through EUR/JPY or AUD/JPY as risk trades look to be on the mend.

This article was written by Justin Low at www.forexlive.com.

The post Ex-Dividend 29/07/2024 first appeared on IC Markets | Official Blog.

• Deutsche Bank expect a line ball Bank of England rate cut this week, 5-4 vote in favour
• Oil markets awaiting the results of Venezuela’s presidential election
• Deutsche Bank expect 3 Fed rate cuts in 2024. BoA says just 1
• PBOC sets USD/ CNY reference rate for today at 7.1316 (vs. estimate at 7.2522)
• Brent crude oil has jumped higher following attack in Middle East that killed 12 children
• National Australia Bank expect RBA on hold … until May 2025
• Australian regulator warns of (slowly) rising arrears on mortgage and business loans
• Australian CPI data due this week, a key critical input to next RBA interest rate deciison
• Bank of Japan “paradigm shift” ideas around inflation
• Morgan Stanley says this week’s FOMC statement will lay foundation for 3 cuts this year
• UBS says a Federal Reserve policy pivot is “on the horizon”
• China is considering increasing stock exchange fees on HFT by a massive factor of x10
• Weekend: Trump Bitcoin pump, “Will not sell govmt BTC, on day one will fire Gary Gensler”
• Bitcoin people getting milked for donations by US Senator
• Trade ideas thread – Monday, 29 July, insightful charts, technical analysis, ideas
• Monday morning open levels, indicative FX rates 29 July – little changed from late Friday
• Timiraos: Fed cut unlikely on Wednesday but officials wary of waiting too long
• Newsquawk Week Ahead: Highlights include FOMC, BoJ, NFP, BoE, ISM Mfg. PMI and OPEC+ JMMC
• Trump says to HODL as Bitcoin is going to the moon
• Weekly Market Outlook (29-02 August)
• A technical look at each of the major currency pairs heading into the new trading week

Oil
opened higher for the week after a weekend rocket attack on Golan
killed 12 people including children. Israel’s security cabinet
authorised Prime Minister Benjamin Netanyahu’s government to decide
on the “manner and timing” of a response. Brent opened in
futures trade with a gap higher and has since not filled the gap.

Oil markets are now awaiting the results of the Venezuelan election.

News
flow otherwise was not notable. There was no data related to major FX
during the session.

USD/JPY
traded higher in the early part of Tokyo morning trade. Highs were
above 154.30 but demand dissipated after the fix. USD/JPY fell hard,
down to under 153.05, not quite hitting the figure. As I update its
back over 153.60. Yen crosses traded mainly a similar path. As a reminder, if you need, the Bank of Japan meeting is this week. The BoJ will be releasing plans for how it intends to reduce Japanese Government Bond buying. The market is also pricing in a better than even chance of a rate hike. The BoJ have made a habit of disappointing market expectations re hikes, so don’t bet the farm on this one.

The
EUR, GBP, NZD, CAD are all a few tics higher vs. the US dollar. Gold
is back around $2395. Bitcoin is higher. US Presidential candidate
Trump was at the Nashville Bitcoin conference. Trump is courting the
crypto vote and thus had many supportive comments to make. BTC/USD is
above $69,300.

This article was written by Eamonn Sheridan at www.forexlive.com.

DXY (US Dollar Index):

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price could potentially make a bullish bounce off pivot and head towards 1st resistance.

Pivot: 103.69
Supporting reasons: Identified as a swing low support level, indicating a significant area where previous declines have found support.

1st support: 102.72
Supporting reasons: Identified as an overlap support level, specifically at the 161.80% Fibonacci Extension, suggesting a significant area where previous declines have found support.

1st resistance: 105.15
Supporting reasons: Identified as an overlap resistance level, specifically at the 61.80% Fibonacci Retracement, indicating a historical point where previous rallies have faced selling pressure or reversed.

EUR/USD:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off pivot and drop to 1st support.

Pivot: 1.0948
Supporting reasons: Identified as a multi-swing high resistance level, specifically at the 127.20% Fibonacci Extension, indicating a potential area where sellers could enter the market after a retracement.

1st support: 1.0799
Supporting reasons: Identified as an overlap support level, specifically at the 50% Fibonacci Retracement, suggesting a significant area where previous declines have found support.

1st resistance: 1.1106
Supporting reasons: Identified as a swing high resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.

EUR/JPY:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off pivot and drop to 1st support.

Pivot: 168.34
Supporting reasons: Identified as a pullback resistance level, specifically at the 38.20% Fibonacci Retracement, indicating a potential area where sellers could enter the market after a retracement.

1st support: 164.59
Supporting reasons: Identified as an overlap support level, specifically at the 50% Fibonacci Retracement, suggesting a significant area where previous declines have found support.

1st resistance: 171.60
Supporting reasons: Identified as an overlap resistance level, specifically at the 61.80% Fibonacci Retracement, indicating a historical point where previous rallies have faced selling pressure or reversed.

EUR/GBP:

Overall momentum of the chart: Bearish

Factors contributing to the momentum: Price is below the bearish Ichimoku cloud

Price could potentially make a bearish reaction off pivot and drop to 1st support.

Pivot: 0.8498
Supporting reasons: Identified as an overlap resistance level, specifically at the 50% Fibonacci Retracement, indicating a potential area where sellers could enter the market after a retracement.

1st support: 0.8385
Supporting reasons: Identified as a swing low support level, suggesting a significant area where previous declines have found support.

1st resistance: 0.8532
Supporting reasons: Identified as an overlap resistance level, specifically at the 78.60% Fibonacci Retracement, indicating a historical point where previous rallies have faced selling pressure or reversed.

GBP/USD:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish bounce off pivot and head towards 1st resistance.

Pivot: 1.2817
Supporting reasons: Identified as a pullback support level, specifically at the 50% Fibonacci Projection, indicating a potential area where buyers could enter the market after a retracement.

1st support: 1.2615
Supporting reasons: Identified as a pullback support level, specifically at the 61.80% Fibonacci Retracement, suggesting a significant area where previous declines have found support.

1st resistance: 1.3008
Supporting reasons: Identified as a swing high resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.

GBP/JPY:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish bounce off pivot and head towards 1st resistance.

Pivot: 197.53
Supporting reasons: Identified as an overlap support level, specifically at the 38.20% Fibonacci Retracement, indicating a potential area where buyers could enter the market after a retracement.

1st support: 191.86
Supporting reasons: Identified as an overlap support level, specifically at the 61.80% Fibonacci Retracement, suggesting a significant area where previous declines have found support.

1st resistance: 207.73
Supporting reasons: Identified as a swing high resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.

USD/CHF:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off pivot and drop to 1st support.

Pivot: 0.8913
Supporting reasons: Identified as an overlap resistance level, specifically at the 50% Fibonacci Retracement, indicating a potential area where sellers could enter the market after a retracement.

1st support: 0.8728
Supporting reasons: Identified as an overlap support level, specifically at the 61.80% Fibonacci Extension, suggesting a significant area where previous declines have found support.

1st resistance: 0.9044
Supporting reasons: Identified as a multi-swing high resistance level, indicating a historical point where previous rallies have faced selling pressure or reversed.

USD/JPY:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Factors contributing to the momentum: Price is in a bearish descending channel

Price could potentially make a bullish bounce off pivot and head towards 1st resistance.

Pivot: 152.91
Supporting reasons: Identified as an overlap support level, specifically at the 38.20% Fibonacci Retracement, indicating a potential area where buyers could enter the market after a retracement.

1st support: 146.42
Supporting reasons: Identified as an overlap support level, specifically at the 78.60% Fibonacci Retracement, suggesting a significant area where previous declines have found support.

1st resistance: 157.89
Supporting reasons: Identified as an overlap resistance level, specifically at the 61.80% Fibonacci Retracement, indicating a historical point where previous rallies have faced selling pressure or reversed.

USD/CAD:

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price has made a bearish reversal off the pivot and could potentially make a pull back towards the 1st support.

Pivot: 1.3828
Supporting reasons: Identified as a swing-high resistance, indicating a significant area where selling pressures could intensify.

1st support: 1.3735
Supporting reasons: Identified as a pullback support that aligns close to a 38.2% Fibonacci retracement, indicating a potential area where price could find support.

1st resistance: 1.3880
Supporting reasons: Identified as a multi-swing-high resistance, indicating a potential area that could halt any further upward movement.

AUD/USD:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price could fall towards the pivot and potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 0.6469
Supporting reasons: Identified as a pullback support that aligns close to a 78.6% Fibonacci retracement level, indicating a potential area where buying interests could pick up to stage a minor rebound.

1st support: 0.6349
Supporting reasons: Identified as a swing-low support, suggesting a potential area where price could find strong support.

1st resistance: 0.6635
Supporting reasons: Identified as a pullback resistance that aligns close to a 38.2% Fibonacci retracement, indicating a significant area that could halt further upward movement.

NZD/USD

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price is trading close to the pivot and could potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 0.5872
Supporting reasons: Identified as a multi-swing-low support that aligns with a 100% Fibonacci projection level, indicating a potential zone where buying interests could pick up to stage a minor rebound.

1st support: 0.5798
Supporting reasons: Identified as a swing-low support, suggesting a significant area that could halt further downward momentum.

1st resistance: 0.5995
Supporting reasons: Identified as a pullback resistance that aligns close to a 50% Fibonacci retracement level, indicating a significant area that could halt further upward movement. 

US30 (DJIA):

Potential Direction: Bullish

Overall Momentum of the Chart: Bullish

Price has made a bullish bounce off the pivot and could potentially rise towards the 1st resistance.

Pivot: 40,056.05
Supporting reasons: Identified as an overlap support that aligns close to a 50% Fibonacci retracement level, indicating a potential area where buying interests could pick up to resume the uptrend.

1st Support: 38,106.51

Supporting Reasons: Identified as a pullback support, suggesting a significant area where price could find strong support.

1st Resistance: 41,277.57

Supporting Reasons: Identified as a pullback resistance that aligns close to a 161.8% Fibonacci extension level, indicating a significant area that could halt further upward movement.

DE40 (DAX):

Potential Direction: Bearish

Overall Momentum of the Chart: Neutral

Price is rising towards the pivot and could potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 18,894.50
Supporting reasons: Identified as a pullback resistance that aligns with a 61.8% Fibonacci projection level, indicating an area where selling pressures could intensify.

1st Support: 18,003.90

Supporting Reasons: Identified as a pullback support that aligns with a 61.8% Fibonacci retracement level, indicating a significant area where price could find strong support.

1st Resistance: 19,487.53

Supporting Reasons: Identified as a resistance that aligns with a 100% Fibonacci projection level, indicating a significant area that could halt further upward movement.

US500 (S&P 500): 

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price is rising towards the pivot and could potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 5,561.91
Supporting reasons: Identified as a pullback resistance that aligns with a 61.8% Fibonacci retracement level, indicating a potential area where selling pressures could intensify to resume the downtrend.

1st support: 5,236.31

Supporting reasons: Identified as a pullback support that aligns close to a 61.8% Fibonacci retracement level, indicating a potential area where price could find strong support. 

1st resistance: 5,673.33

Supporting reasons: Identified as a swing-high resistance that aligns close to the all-time high, suggesting a critical area that could halt further upward movement.

BTC/USD (Bitcoin):

Potential Direction: Bearish

Overall momentum of the chart: Neutral

Price is rising towards the pivot and could potentially make a bearish reversal off this level to pull back towards the 1st support.

Pivot: 73,176.19

Supporting reasons: Identified as a pullback resistance that aligns close to the all-time high, indicating a potential area where selling pressures could intensify.

1st support: 63,982.37

Supporting reasons: Identified as a pullback support, indicating a significant area that could halt further downward movement.

1st resistance: 77,001.53

Supporting reasons: Identified as a resistance that aligns with a 127.2% Fibonacci extension level, indicating a potential barrier that could halt further upward movement.

ETH/USD (Ethereum):

Potential Direction: Bearish

Overall momentum of the chart: Neutral

Price is rising towards the pivot and could potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 3,540.71

Supporting reasons: Identified as a pullback resistance that aligns with a 61.8% Fibonacci retracement level, indicating a potential area where selling pressures could intensify.

1st Support: 2,881.88

Supporting Reasons: Identified as a multi-swing-low support that aligns close to a 61.8% Fibonacci retracement level, indicating a significant area that could halt further downward movement.

1st Resistance: 3,889.27

Supporting Reasons: Identified as a swing-high resistance, indicating a historical barrier where selling pressures could intensify.

WTI/USD (Oil):

Potential Direction: Bearish

Overall Momentum of the Chart: Bearish

Price could fall towards the pivot and potentially make a bearish break through this level to fall towards the 1st support.

Pivot: 77.37

Supporting Reasons: Identified as a potential breakout level where the strong bearish momentum could drive the price lower. The presence of a downward channel adds further significance to the bearish momentum.

1st Support: 72.31

Supporting Reasons: Identified as a multi-swing-low support that aligns with a 78.6% Fibonacci retracement level, indicating a significant area where price could find strong support.

1st Resistance: 80.81

Supporting Reasons: Identified as a pullback resistance that aligns with a 50% Fibonacci retracement level, indicating a potential barrier that could halt further upward movement.

XAU/USD (GOLD):

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reaction off pivot and drop to 1st support.

Pivot: 2468.69
Supporting reasons: Identified as a multi-swing high resistance level, indicating a potential area where sellers could enter the market after a retracement.

1st support: 2286.33
Supporting reasons: Identified as an overlap support level, specifically at the 38.20% Fibonacci Retracement, suggesting a significant area where previous declines have found support.

1st resistance: 2550.94
Supporting reasons: Identified as a 161.80% Fibonacci Extension level, indicating a historical point where previous rallies have faced selling pressure or reversed.

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News, views, opinions, recommendations and other information obtained from sources outside of www.icmarkets.com, used in this site are believed to be reliable, but we cannot guarantee their accuracy or completeness. All such information is subject to change at any time without notice. IC Markets assumes no responsibility for the content of any linked site.

The fact that such links may exist does not indicate approval or endorsement of any material contained on any linked site. IC Markets is not liable for any harm caused by the transmission, through accessing the services or information on this site, of a computer virus, or other computer code or programming device that might be used to access, delete, damage, disable, disrupt or otherwise impede in any manner, the operation of the site or of any user’s software, hardware, data or property. 

The post Monday 29th July 2024: Technical Outlook and Review first appeared on IC Markets | Official Blog.

IC Markets Asia Fundamental Forecast | 29 July 2024

What happened in the U.S. session?

After easing on a monthly and annualised basis in May, the PCE Price Index – which is the Federal Reserve’s preferred gauge of inflation – came mostly in line with June’s estimates. Headline PCE increased 0.1% MoM while easing marginally from 2.6% to 2.5% YoY. Meanwhile the core rose 0.2% MoM while remaining unchanged at 2.6% YoY. In short, this result reflected another month of ‘soft’ price increases and paves the way for the Fed to move ahead with the first rate cut in September. The dollar index (DXY) was hovering around 104.40 and it fell towards 104.20 following the release of this data point.

What does it mean for the Asia Session?

As Asian markets digest the latest inflation data from stateside, the DXY dipped under 104.20 and looks set to drift lower as the day progresses. Accompanied by a barren economic calendar today, trading activity could be rather subdued for the initial half of the day.

The Dollar Index (DXY)

Key news events today

No major news events.

What can we expect from DXY today?

The DXY ranged within an extremely narrow band of 104.08 and 104.55 last week before closing at 104.32 on Friday. It opened this morning to rise towards 104.40 before reversing to fall and dip under 104.20 – these are the support and resistance levels for today.

Support: 103.70

Resistance: 104.50

Central Bank Notes:

• The Federal Funds Rate target range remained unchanged at 5.25% to 5.50% for the seventh meeting in a row.
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and judges that the risks to achieving its employment and inflation goals have moved toward better balance over the past year.
• The economic outlook is uncertain, and the Committee remains highly attentive to inflation risks. Inflation has eased over the past year but remains elevated and in recent months, there has been modest further progress toward the Committee’s 2% inflation objective.
• Recent indicators suggest that economic activity has continued to expand at a solid pace while job gains have remained strong, and the unemployment rate has remained low.
• In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks and does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%.
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
• In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities. Beginning in June, the Committee will slow the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion.
• The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities.
• Next meeting runs from 30 to 31 July 2024.

Next 24 Hours Bias

Weak Bearish

Gold (XAU)

Key news events today

No major news events.

What can we expect from Gold today?

Spot prices for gold tumbled over 2% over the last couple of weeks as it dropped as low as $2,353.14/oz on Thursday before retracing higher to close at $2,387.34/oz on Friday. This precious metal rose towards $2,400.00/oz at the beginning of the Asia session – these are the support and resistance levels for today.

Support: 2,350.00

Resistance: 2,430.00

Next 24 Hours Bias

Weak Bullish

The Australian Dollar (AUD)

Key news events today

No major news events.

What can we expect from AUD today?

The Aussie shed 3.3% over the last couple of weeks as it dived from 0.6783 in mid-July to as low as 0.6513 on Thursday before retracing to climb higher and close at 0.6545 on Friday. This currency pair was trading around 0.6560 as Asian markets came online – these are the support and resistance levels for today.

Support: 0.6465

Resistance: 0.6630

Central Bank Notes:

• The RBA kept the cash rate target unchanged at 4.35%, marking the ninth pause out of the last ten board meetings.
• Over the year to April, the monthly CPI indicator rose by 3.6% in headline terms, and by 4.1% excluding volatile items and holiday travel, which was similar to its pace in December 2023.
• The central forecasts published in May were for inflation to return to the target range of 2–3% in the second half of 2025 and to the midpoint in 2026 while there have been indications that momentum in economic activity is weak, including slow growth in GDP, a rise in the unemployment rate and slower-than-expected wages growth.
• Inflation is easing but has been doing so more slowly than previously expected and it remains high and the Board expects that it will be some time yet before inflation is sustainably in the target range.
• The path of interest rates that will best ensure that inflation returns to target in a reasonable timeframe remains uncertain and the Board is not ruling anything in or out.
• Next meeting is on 6 August 2024.

Next 24 Hours Bias

Weak Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

Significant weakness in the Kiwi has caused it to decline nearly 4.1% over the past three weeks as it hit a low of 0.5880 on Thursday before stabilizing around this level to close at 0.5887 on Friday. Overhead pressures remain and further downside can be expected for the Kiwi – these are the support and resistance levels for today.

Support: 0.5800

Resistance: 0.5980

Central Bank Notes:

• The Monetary Policy Committee kept the OCR unchanged at 5.50% for the eighth meeting in a row and agreed that restrictive monetary policy is reducing domestic demand and consumer price inflation.
• The Committee is confident that inflation will return to within its 1-3% target range over the second half of 2024.
• The decline in inflation reflects receding domestic pricing pressures, as well as lower inflation for goods and services imported into New Zealand while recent monthly Selected Price Indexes suggest weakening in some of the more volatile inflation components, while survey measures of cost pressures and pricing intentions have continued to decline.
• Non-performing bank loans and corporate insolvencies have increased from low levels in line with declining economic activity while bank credit growth also remains very subdued, in line with weakness in the domestic economy and low business and consumer confidence.
• Next meeting is on 14 August 2024.

Next 24 Hours Bias

Weak Bullish

The Japanese Yen (JPY)

Key news events today

No major news events.

What can we expect from JPY today?

The yen strengthened significantly over the last three weeks causing USD/JPY to dive over 4.1%, losing almost 650 pips in the process to close at 153.80 on Friday. This currency pair opened around 153.64 at the beginning of the Asia session – these are the support and resistance levels for today.

Support: 152.00

Resistance: 157.90

Central Bank Notes:

• The Bank considers that the policy framework of Quantitative and Qualitative Monetary Easing (QQE) with Yield Curve Control and the negative interest rate policy to date have fulfilled their roles. With the price stability target of 2%, it will conduct monetary policy as appropriate, guiding the short-term interest rate as a primary policy tool.
• The Bank of Japan decided on the following measures:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0 to 0.1% while continuing its Japanese government bonds (JGB) purchases in accordance with the decisions made at the March 2024 MPM.
  2. The Bank decided, by an 8-1 majority vote, that it would reduce its purchase amount of JGBs thereafter to ensure that long-term interest rates would be formed more freely in financial markets.
• Underlying CPI inflation is expected to increase gradually, since it is projected that the output gap will improve and that medium- to long-term inflation expectations will rise with a virtuous cycle between wages and prices continuing to intensify.
• In the second half of the projection period of the April 2024 Outlook for Economic Activity and Prices (Outlook Report), it is likely to be at a level that is generally consistent with the price stability target of 2%.
• The year-on-year rate of increase in the CPI (all items less fresh food), has been in the range of 2.0-2.5% recently, as services prices have continued to rise moderately, reflecting factors such as wage increases, although the effects of a pass-through to consumer prices of cost increases led by the past rise in import prices have waned. Inflation expectations have risen moderately.
• Japan’s economy has recovered moderately, although some weakness has been seen in part while is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
• Next meeting is on 31 July 2024.

Next 24 Hours Bias

Weak Bearish

The Euro (EUR)

Key news events today

No major news events.

What can we expect from EUR today?

The Euro closed at 1.0855 last Friday and it opened this morning to rise towards 1.0870 – these are the support and resistance levels for today.

Support: 1.0800

Resistance: 1.0950

Central Bank Notes:

• The Governing Council today decided to keep the three key ECB interest rates unchanged in July, following a 25 basis points cut in June.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 4.25%, 4.50% and 3.75% respectively.
• Monetary policy is keeping financing conditions restrictive but at the same time, domestic price pressures are still high, services inflation is elevated and headline inflation is likely to remain above the target well into next year.
• While some measures of underlying inflation ticked up in May owing to one-off factors, most measures were either stable or edged down in June.
• The incoming information indicates that the euro area economy grew in the second quarter, but likely at a slower pace than in the first quarter.
• Services continue to lead the recovery, while industrial production and goods exports have been weak – investment indicators point to muted growth in 2024, amid heightened uncertainty.
• The Eurosystem no longer reinvests all of the principal payments from maturing securities purchased under the pandemic emergency purchase programme (PEPP), reducing the PEPP portfolio by €7.5 billion per month on average and the Governing Council intends to discontinue reinvestments under the PEPP at the end of 2024.
• The Council is determined to ensure that inflation returns to its 2% medium-term target in a timely manner and will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim and is not pre-committing to a particular rate path.
• Next meeting is on 12 September 2024.

Next 24 Hours Bias

Weak Bullish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

Demand for the franc picked up in July as USD/CHF tumbled nearly 1.6% to lose almost 150 pips in the process. This currency pair was trading around 0.8825 and was sliding lower at the beginning of the Asia session – these are the support and resistance levels for today.

Support: 0.8730

Resistance: 0.8915

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 25 basis points for the second consecutive meeting, going from 1.50% to 1.25% in June.
• The underlying inflationary pressure has decreased again compared to the previous quarter but inflation had risen slightly since the last monetary policy assessment, and stood at 1.4% in May.
• The inflation forecast puts average annual inflation at 1.3% for 2024, 1.1% for 2025 and 1.0% for 2026, based on the assumption that the SNB policy rate is 1.25% over the entire forecast horizon.
• Swiss GDP growth was moderate in the first quarter of 2024 with the services sector continuing to expand, while manufacturing stagnated.
• Growth is likely to remain moderate in Switzerland in the coming quarters as the SNB anticipates GDP growth of around 1% this year while currently expecting growth of around 1.5% for 2025.
• Next meeting is on 26 September 2024.

Next 24 Hours Bias

Weak Bullish

The Pound (GBP)

Key news events today

No major news events.

What can we expect from GBP today?

Cable dropped 1% over the last couple of weeks to close at 1.2865 on Friday. This currency pair rose towards 1.2890 as Asian markets came online and is expected to edge lower as the day progresses – these are the support and resistance levels for today.

Support: 1.2800

Resistance: 1.2950

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 7-to-2 to maintain its Official Bank Rate at 5.25% for the seventh consecutive meeting.
• Two members preferred to reduce the Bank Rate by 25 basis points to 5%, an increase of one from the previous meeting.
• Twelve-month CPI inflation fell to 2.0% in May from 3.2% in March, close to the May Monetary Policy Report projection. CPI inflation is expected to rise slightly in the second half of this year, as declines in energy prices last year fall out of the annual comparison.
• Reflecting a margin of slack in the economy, CPI inflation had been projected to be 1.9% in two years’ time and 1.6% in three years.
• UK GDP appears to have grown more strongly than expected during the first half of this year. Business surveys, however, remain consistent with a slower pace of underlying growth, of around 0.25% per quarter.
• UK real GDP had increased by 0.6% in 2024 Q1, 0.2% stronger than had been expected in the May Monetary Policy Report and Bank staff now expect GDP growth of 0.5% in 2024 Q2 as a whole, stronger than the 0.2% rate that had been incorporated in the May Report.
• The MPC remains prepared to adjust monetary policy as warranted by economic data to return inflation to the 2% target sustainably. It will therefore continue to monitor closely indications of persistent inflationary pressures and resilience in the economy as a whole, including a range of measures of the underlying tightness of labour market conditions, wage growth and services price inflation.
• Next meeting is on 1 August 2024.

Next 24 Hours Bias

Weak Bullish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

Recent weakness in the Loonie has propelled USD/CAD higher as it rose from 1.3600 to a high of 1.3850 before closing at 1.3835 Friday, gaining almost 1.4% in the process. This currency pair was trading around 1.3820 at the beginning of the Asia session and looks set to drift lower today – these are the support and resistance levels for today.

Support: 1.3780

Resistance: 1.3850

Central Bank Notes:

• The Bank of Canada reduced its target for the overnight rate by 25 basis points to 4.50% while continuing its policy of balance sheet normalization.
• Canada’s economic growth likely picked up to about 1.5% through the first half of this year and is forecasted to increase in the second half of 2024 and through 2025.
• Overall, the Bank forecasts GDP growth of 1.2% in 2024, 2.1% in 2025, and 2.4% in 2026, reflecting stronger exports and a recovery in household spending and business investment as borrowing costs ease.
• CPI inflation moderated to 2.7% in June after increasing in May as broad inflationary pressures eased.
• The Bank’s preferred measures of core inflation have been below 3% for several months and the breadth of price increases across components of the CPI is now near its historical norm but shelter price inflation remains high, driven by rent and mortgage interest costs, and is still the biggest contributor to total inflation.
• These preferred measures of core inflation are expected to slow to about 2.5% in the second half of 2024 and ease gradually through 2025 and CPI inflation is expected to come down below core inflation in the second half of this year, largely because of base year effects on gasoline prices.
• There are signs of slack in the labour market with the unemployment rate rising to 6.4%, as employment continues to grow more slowly than the labour force and job seekers taking longer to find work. Wage growth is showing some signs of moderation, but remains elevated.
• The Governing Council’s future monetary policy decisions will be guided by incoming information and assessment of their implications for the inflation outlook.
• Recent data has increased the council’s confidence that inflation will continue to move towards the 2% target. Nonetheless, risks to the inflation outlook remain.
• Next meeting is on 4 September 2024.

Next 24 Hours Bias

Weak Bearish

Oil

Key news events today

No major news events.

What can we expect from Oil today?

Prices for crude oil fell for three straight weeks, a feat last observed at the end of May – WTI oil dived over 8% as it closed at $77.75 per barrel on Friday. This benchmark gapped higher to open at $78.49 but overhead pressures remain for this commodity – these are the support and resistance levels for today.

Support: 77.37

Resistance: 80.81

Next 24 Hours Bias

Weak Bearish

The post IC Markets Asia Fundamental Forecast | 29 July 2024 first appeared on IC Markets | Official Blog.

Venezuela’s presidential election results are not yet known.

Polls began to close on Sunday.

The contest is Nicolás Maduro’s facing off with opposition candidate Edmundo González. González has been leading in the polls, but in echoes of what we have heard another presidential election, Maduro says a big electoral victory is necessary to avoid “a bloodbath, or a fratricidal civil war”.

For oil, S&P analysts say:

• The winner of Venezuela’s July 28 presidential election will face an uphill battle in restoring crude production, which has tumbled following years of US sanctions.
• Those sanctions might be eased if opposition candidate Edmundo González wins, which could help bring in much-needed investments to restore the country’s dilapidated infrastructure.

S&P provide this excellent summary in infographic form:

This article was written by Eamonn Sheridan at www.forexlive.com.