The U.S. Federal Reserve’s FOMC Meeting Minutes fails to surprise the market with hawkish bias. As per the minutes from the Federal Reserve’s July 30-31 monetary policy meeting, two of the Fed policymakers voiced their preference to make a 50 basis point rate cut in July rather than a 25 basis point cut to address the low inflation.
The U.S. Federal Reserve policymakers were intensely divided over whether to cut interest rates. Minutes from the two-day meeting published yesterday on Wednesday revealed policymakers’ final decision to reduce the central bank’s benchmark interest rate by a quarter percentage point carried more opposition than was displayed in the rate-setting panel’s 8-2 vote, published after the meeting adjourned on July 31.
Economic Calendar – Eurozone’s PMI Figures
Today, the market prepares to trade the series of manufacturing and services PMI data from Eurozone.
EUR/USD – Manufacturing & Services PMI In Focus
Despite mixed FOMC report, the EUR/USD pair managed to maintain its sideways range of 1.1115 – 1.1070. Traders are finding no solid reason to derive breakout of the range, however, today it has a good chance of breaking out of the range. It’s especially a busy day ahead on the Eurozone economic calendar. Important stats due out of the Eurozone include August prelim private division PMI figures out of France, Germany, and the Eurozone.
In addition to PMI figures, the ECB monetary policy meeting minutes are also due out later today.
It’s been the 6th consecutive day, the EUR/USD continues to consolidate in a narrow trading range of 1.1115 to 1.1065. The risk continues for the downside, although to validate a bearish rally, the pair would need to violate 1.1065 on the lower side.
The EUR/USD may have a bullish or bearish breakout on the back of PMI figures. A bearish breakout can lead EUR/USD towards 1.1035 while a bullish breakout at 1.1115 can extend bullish trend until 1.1160.
EUR/USD – Daily Technical Levels
Pivot Point 1.1154
EUR/USD – Daily Forecast
On Thursday, I will be looking to staying bearish below 1.1115 to target 1.1060 support areas. Below this, the EUR/USD can extend bearish rally until 1.1030 today.
On the flip side, buying is preferred near 1.1030 on the lower side or 1.1120 in case of a bullish breakout.
GBP/USD – CBI Retail Sales In Focus
The GBP/USD pair trimmed lower through these last three sessions, finishing the day at nearby 1.2140, as optimism for a change in the Irish backstop calmed down after remarks from German authorities. President Steinmeier and later, FM Scholz bot repeated that the Departure Agreement wouldn’t be re-opened.
Sterling made a bit of bullish progress, but bearish trendline on the 4-hour timeframe has pushed the GBP/USD lower towards 1.2120.
At the moment, Sterling is facing support around 1.2085 along with resistance at 1.2165. Choppy trading is expected within these levels. However, the bearish breakout can extend selling trend until 1.2080 and 1.2040 today. On the upperside, resistance stays at 1.2207.
GBP/USD – Daily Technical Levels
Pivot Point 1.2136
GBP/USD – Daily Forecast
In the absence of British fundamentals, I will be looking to stay bullish above 1.2080 with a target of 1.2170 and 1.2200 on the upper side. Whereas, bearish positions are suggested below 1.2085 support.
Gold – Improved Risk Sentiment Weights on Precious Metal
The yellow metal gold prices slipped more than 1% over concerns mounted that major markets could tip into recession, boosting investors’ association for risk and decreasing from bullion’s safe-haven appeal.
FOMC also failed to drive any major movement in gold prices. Minutes of the Federal Reserve’s July meeting revealed policymakers were divided over whether to cut interest rates but were united in wanting to signal they were not on a path to more easing.
During the Asian session, the precious metal gold continues to trade is sideways, within a narrow trading range of around 1502 – 1494 over risk-on sentiments, where traders are seen to switch their investments from safe-haven assets to risky ones, as they are yielding more profits right now.
Gold’s immediate support stays at 1,494 and 1,489 the violation of these levels can expose gold towards 1,470 area. On the other hand, gold is likely to face resistance around 1,508 and 1,517.
Gold – Daily Technical Levels
Pivot Point 1509.3
Gold – Daily Forecast
I will be looking to stay bullish above 1,489 to 1,509 level. The safe-haven has faded, and most of the traders are now trading risk-on sentiment, moving funds into the global stock markets.
BTC/USD – Daily Forecast
The BTC/USD fell sharply through 10,000.00 on Wednesday. Violation and closing of candles below 10K psychological level is suggesting strong bearish bias among traders. Now if the trend is to turn down the 9467.57 low will be a major level as a break would make a lower high followed by a lower wave low.
Nevertheless, below that, there is another crucial level when it comes to chart structure and that is the 9049.54 wave low from 17th July. This level is the main consolidation low after the most recent rally to 13,880.00.
BTC/USD is facing double bottom support around 9,780. We may see bullish correction until 10,200 but chances of a bearish breakout look dominant. Closing of more candles above 9,780 will trigger buying, and closing of candles below 9,780 can lead BTC/USD towards 9,400.
All the best and have a profitable day!