The US dollar returned to its strong upward trajectory amid increasing expectations of the chances of raising US interest rates strongly during 2022. Accordingly, this was a good reason for the EUR/USD pair to decline strongly below the 1.0500 support. As I mentioned before that stability below it will support further collapse to the bottom. The euro’s losses reached the level of 1.0435, which is stable around it in the beginning of trading today, Thursday.

Data from Germany suggests that peak inflation may have passed, lowering eurozone bond yields and euro exchange rates, but there was a partial reversal after Spain’s inflation numbers came in higher than expected. This is an early indication that perhaps the worst of the current inflation spike may have passed and will ease pressure on the European Central Bank to adopt an aggressive rate hike approach.

Commenting on this, Matthias van der Geogt, analyst at KBC Markets says: “European yields and the euro fell after the release of Germany’s first regional CPI reading for June.” It adds to the summer consolidation/correction phase in the bond markets. It also indicates that the EUR/USD could be limited to 1.0350/1.0642 instead of 1.0350/1.08.” “The CPI data for North Rhine-Westphalia (NRW), the most populous federal state in Germany, indicates a much lower reading, which may have been driven by the recent drop in oil prices,” says Tulia Boko, an economist at UniCredit Bank. . And if the NRW data were reversed by other federal states, whose numbers were released later in the morning, the nationwide inflation reading could be only around 7%.

Overall, the European Central Bank is poised to raise interest rates in July and again in September as it grapples with rising inflation, triggering a policy shift that boosted bond yields in the euro zone and provided a floor under the euro. The magnitude and number of spikes received is important to the EUR exchange rates: a 50bp move is seen as a strong commitment to normalization and likely to support the EUR, all else being equal.

But weak inflation readings may encourage a more cautious 25 basis point rate hike, which would disappoint current market expectations for a more aggressive reaction. It may also indicate that the ECB may not make as many rallies over the coming months as the market had been expecting.

Indeed, prior to the data release, markets were pricing as high as 30 basis points from the gains for July, indicating that the prospects for a 50 basis point lift were on edge. As of June 13, the market was expecting a peak in the ECB deposit rate at 2.48%, but it has since fallen back to 2.04% as of June 27 and we expect the latest reading to be lower.

Taming rate hike expectations will trigger a mechanical bearish response in the Euro, as seen in midweek trading. However, don’t expect a complete capitulation for the Euro just yet: Spanish CPI inflation was released hours after German numbers were released higher than expected. The annual figure for May came in at 10.2%, higher than the expected 9.0% and previously announced 8.7%. This is more reactionary than the NRW data in time, but nevertheless the ECB must ensure that its current course is maintained.

EUR/USD forecast today:

Bears control over the EUR/USD pair increased by surpassing the support level of 1.0500 as mentioned in the recent technical analyzes. Currently the closest support levels for the pair are 1.0420 and 1.0380, and from the last level, the technical indicators will move towards oversold levels. The most appropriate resistance levels for the rebound will be above 1.0620 and 1.0800, respectively. The Euro is awaiting the release of German unemployment data and the unemployment rate in the Eurozone. The US dollar is on a date with the announcement of the reading of the personal consumption expenditures price index, the average income and spending of the American citizen, and the weekly jobless claims.

Gold futures retreated from the gains that coincided with the beginning of trading this week, with the yellow metal entering the negative territory throughout the year. Metal commodities suffered a broad sell-off amid recession fears. With stocks still in a bear market and inflation high, will investors return to traditional safe assets?

Yesterday, the price of an ounce of gold jumped to the level of 1841 dollars, and then returned to the level of 1821 dollars an ounce today. In general, gold prices fell by about 1% during trading last week, which increased its losses since the start of the year 2022 to date to about 0.3%. The yellow metal is on track for a monthly decline of at least 1%. Also, silver, the sister commodity to gold, was trading relatively flat at the start of the week’s trading. Silver futures rose to $21.145 an ounce. The white metal comes out of a weekly loss of more than 2%, in addition to its decline since the start of the year 2022 to date by nearly 10%.

Despite the weak US dollar, investors are reacting to higher Treasury yields. In addition, investors are keeping an eye on the latest geopolitical developments after the Group of Seven nations will soon ban imports of Russian gold. US President Joe Biden announced Sunday that the Group of Seven will prevent the import of Russian gold, while the British government confirmed to the media that these countries agreed to the ban.

Investors do not believe that this will have any material impact on the economy because its contribution to the global metals market is minimal. Many countries with huge gold reserves and huge mining infrastructure will be willing to step in and make up the shortfall. However, Moscow contributed the second highest level of gold, totaling 330 tons in 2021.

Meanwhile, the dollar weakened on Monday, with the US Dollar Index (DXY), a measure of the US currency against a basket of major currencies, falling to the 103.91 level, down from an opening at 104.19. The index is emerging from a weekly decline of 0.7%, reducing its annual rise to 8.2%.

A weak dollar is beneficial for dollar-priced commodities because it makes it cheaper for foreign investors to buy them.

The US Treasury market was positive, with the benchmark 10-year bond yield rising 7.5 basis points to 3.2%. The two-year bond yield rose 7.5 basis points to 3.132%. Therefore, the spread between the two debt instruments was less than seven basis points, which is critical to market analysts because a reversal could signal a recession. However, gold is sensitive to the environment of higher prices because it causes it to raise the opportunity cost of holding non-yielding bullion.

In other metals markets, copper futures rose to $3.751 a pound. Platinum futures rose to $904.80 an ounce. Palladium futures rose to $1,861.50 an ounce.

Gold price forecast today:

The gold price is still moving within a downward correction, and the bears’ control of the trend will be strengthened if the gold price moves to the support levels of 1815, 1800 and 1785 dollars, respectively. All in all, I still prefer buying gold from every bearish level. On the other hand, the bulls will return to control the trend if the gold price moves towards the resistance levels 1855 and 1877, respectively. Technical indicators are in a neutral position with a bearish slope.

We expect the lira’s decline to continue.

Today’s recommendation on the lira against the dollar

Risk 0.50%.

The sale transaction has been completed and is still being traded

Best selling entry points

• Entering a short position with a pending order from levels 17.45
• Set a stop-loss point to close the lowest support levels 17.65.
• Move the stop loss to the entry area and continue to profit as the price moves by 50 pips.
• Close half of the contracts with a profit equal to 55 pips and leave the rest of the contracts until the strong resistance levels at 16.40.

Best buy entry points

• Entering a buy position with a pending order from 17.00 levels
• The best points for setting the stop loss are closing the highest levels of 16.88.
• Move the stop loss to the entry area and continue to profit as the price moves by 50 pips.
• Close half of the contracts with a profit equal to 55 pips and leave the rest of the contracts until the support levels 17.40

The Turkish lira has stabilized as investors follow the efforts of the Turkish government to maintain the stability of the local currency. The Treasury is heading to launch a program that is expected to be implemented at the beginning of next month. This allows investors abroad to benefit from a swap plan that allows the purchase of local assets with maturities of at least three to six months. The plan comes as part of the government’s efforts to attract foreign investors away from the restrictions on short selling the lira, which the country suffered during 2008. In another plan that the Turkish Central Bank may put forward, it states the possibility of offering financing to foreigners in the Turkish currency without interest in return for a return of up to 4 percent on the dollar

On the technical front, the Turkish lira stabilized against the US dollar, as it traded within a narrow range, which is shown on the chart. Between levels of 17.19 and 17.33 pounds. The pair maintained the general upward trend, with the pair trading the highest support levels, which are concentrated at 17.00 and 16.80 levels, respectively. The pair also continued trading above the 50, 100 and 200 moving averages, respectively, on the four-hour time frame, while the price traded between the same averages on the 60-minute time frame, indicating a divergence in the short term. At the same time, the lira is trading below the resistance levels at 17.40 and 17.80, respectively. The level of 17.41 represents a strong resistance level. We expect the lira’s decline to continue, as every decline on the pair represents an opportunity to repurchase, especially if it crosses the mentioned resistance levels. Please adhere to the numbers in the recommendation with the need to maintain capital management.

During last week’s trading, GBP/USD rebounded sharply from its March 2020 lows and could look to extend its recovery in the coming days. A lot depends on US bond yields and the impact of statements from Fed policy makers and a looming wave of UK economic numbers. The GBP/USD price collapsed below the psychological support 1.2000, which was expected since it fell to the 1.2175 support. The currency pair has settled around the 1.2260 level since yesterday.

The British pound slumped briefly below 1.20 against the dollar last week only to rebound to the 1.24 level last Thursday when the Bank of England (BoE) announced the fifth rate hike since December. This was followed by a sharp rise in market expectations for the bank rate over the coming months. Sterling was also helped significantly when the US dollar fell in general almost along with US government bond yields in the wake of the US Federal Reserve’s monetary policy decision for June.

While the increasingly “hard” market expectations of UK interest rates could be discouraged by either the Bank of England itself or any number of economic numbers set to emerge from the UK this week, they have so far provided a significant boost to the rate of the pound against the dollar. The rising bond yields in Britain combined with falling US yields to raise the spread or gap between these yields in a supportive way for the pound after the Federal Reserve economic forecast in June indicated that the bank was likely to raise US interest rates only as much as financial markets had I did that. Already envisaged for this year.

Last week, the Federal Open Market Committee (FOMC) took another important step toward meeting the inflation target by raising the federal funds rate target by 75 basis points.

To the extent that the above trend in the bond market continues, sterling may help reverse some of the sharp decline in the second quarter.

However, the risk is that the US dollar strengthens regardless of what happens in the bond market this week if comments from Federal Reserve Chairman Jerome Powell on Wednesday and Thursday, or other members of the Federal Open Market Committee (FOMC), exacerbate emerging concerns about the possibility of a US or even global recession in the near future. This is a possibility given the extent to which the Federal Reserve and other global central banks are increasingly focused on curbing inflation to rule out all other concerns including the potential fallout for the labor and employment markets.

According to the technical analysis of the currency pair: The price of the GBP/USD currency pair lacks the strength factors to break through the general bearish trend. As I mentioned before, the continuation of the pessimism of the Bank of England and the negative results of the British economic data negatively affect any attempts of the GBP/USD to rebound to the highest and closest levels. The resistance for the currency pair is 1.2320 and 1.2400 and I still prefer to sell the currency pair from every bullish level.

On the other hand, the return of the sterling dollar price to the vicinity of the support 1.2175 will support expectations again to move towards the psychological support level 1.2000, thus increasing the strength of the downward trend.

ETH/USD did not sell off politely this weekend, it dove through support levels quickly and Ethereum is challenging all traders.

ETH/USD is trading near the 1340.00 price as of this morning. Hopefully, traders with buying positions were using stop loss tactics this weekend, and did not see their entire account get wiped out by the volatility which has been demonstrated. ETH/USD has sunk an astounding amount. When the weekend began, ETH/USD was trading slightly below the 1700.00 mark. Price velocity has been lightning fast and speculators should be braced for additional adventures.

To put the current price of Ethereum into perspective, the price of ETH/USD during a run upwards in one of its first exuberant higher rocket ship like launches hit 1360.00 in January of 2018.  By December of 2018 ETH/USD was touching 70.00. This is not written to suggest ETH/USD is going to fall to 72.00 in the coming months, but it does highlight that nearly 4 and half years ago the price of Ethereum matched its price currently. Buyer beware is a mantra traders may want to repeat.

In the second week of November 2021 ETH/USD was trading at approximately 4850.00. The bearish trend in ETH/USD has been wicked, and traders who are intent on looking for upside momentum to suddenly flourish and be sustained will likely have to be patient. The 1300.00 juncture was flirted with in the early hours of this morning.

If ETH/USD were to break below the 1310.00 level in the short term, that could spark another round of selling today.  The coming week of trading is likely going to produce price fireworks as speculators in Ethereum react to extreme conditions caused by the fragile behavioral sentiment, which is abundant in the broad cryptocurrency markets. As a leader within the market, ETH/USD will be looked to as a road sign also for clues about directions.

If the 1300.00 level is broken and trading cannot be sustained above this juncture, it could create a test of an almost unimaginable (a few weeks ago) 1225.00 value.  Traders who want to continue to look for downside in ETH/USD cannot be blamed, but they should be extraordinarily cautious in the near term. Speculators looking for upside, almost needless to say, should keep their ambitions realistic. While it may be tempting to aim for 1400.00, it may also prove to be costly if buyers do not emerge.

ETH/USD has entered the landscape of vast volatility and traders should prepare for more instability ahead. The trend has been lower and it may continue to display power, but wagering on this momentum needs to be done with great care.

Ethereum Short-Term Outlook

Current Resistance: 1381.00

Current Support: 1315.00

High Target: 1445.00

Low Target: 1228.00

We expect the lira to continue to decline, especially as long as it continues trading above the bullish trend line, as every dip on the pair represents an opportunity to buy back.

Today’s recommendation on the lira against the dollar

– Risk 0.50%.

– Yesterday’s buy deal was activated and half of the contracts were closed at profits and a stop loss point was provided.

Best selling entry points

Entering a short position with a pending order from 17.11 levels

– Set a stop-loss point to close the lowest support levels 17.26.

– Move the stop loss to the entry area and continue to profit as the price moves by 50 pips.

Close half of the contracts with a profit equal to 55 pips and leave the rest of the contracts until the strong resistance levels at 16.40.

Best entry points buy

Entering a long position with a pending order from 16.58 levels

– The best points for setting the stop loss are closing the highest levels of 16.32.

– Move the stop loss to the entry area and continue to profit as the price moves by 50 pips.

Close half of the contracts with a profit equal to 55 pips and leave the rest of the contracts until the support levels 17.00

The Turkish lira continued to record sharp losses, approaching its lowest levels against the US dollar, as the lira approached its lowest levels during the past year. The bets of selling the lira against the dollar increased after the Turkish President’s statements yesterday, in which he insisted on reducing the interest rate in a counter to the monetary tightening policies pursued by central banks around the world. Analysts believe that the lack of tools from the Turkish Central Bank may contribute to increasing pressures on the Turkish currency, especially with the shrinking of the size of the cash reserves in the country and the expansion of inflation to its highest level in 24 years. On the political front, investors followed the statements of Turkish Defense Minister Hulusi Akar on Tuesday that his country is ready to contribute to the safe export of grain from the ports of Ukraine. Attention was also paid to the measures that could be taken for the safe transportation of grain, sunflower and other agricultural products. Turkey is committed to providing support in this field and renewed its readiness to play its role to achieve peace in the region.

On the technical front, the Turkish lira fell against the dollar to continue recording new lows this year. During today’s trading, the lira approached the main resistance levels at 17.00. The pair maintained its trading above the bullish trend shown on the chart. The pair also continued trading above the moving averages 50, 100 and 200, respectively, on the four-hour time frame as well as on the 60-minute time frame. Referring to the general upward trend. At the same time, the pair is trading the highest support levels, which are concentrated at 16.50 and 16.40 levels, respectively. On the other hand, the lira is trading below the resistance levels at 17.11 and 17.40, respectively. We expect the lira to continue to decline, especially as long as it continues trading above the bullish trend line, as every dip on the pair represents an opportunity to buy back. Please adhere to the numbers in the recommendation with the need to maintain capital management.

I still prefer to sell EUR/USD from every bullish level and the most notable current highs are 1.0785, 1.0830 and 1.0900 respectively.

Despite the successive statements by the monetary policy officials of the European Central Bank and the record European inflation figures that support the hints of these statements, the price of EUR/USD was exposed to profit-taking operations from the resistance level 1.0786 to the support level 1.0680 before settling around the 1.0730 level at the time of writing the analysis.

Inflation rates in Europe jumped stronger than markets once again when it rose to new highs for the month of May, proving in the process a shift in the current monetary policy stance at the European Central Bank (ECB) but also likely to add fuel to an already spirited debate. Yesterday’s Eurostat figures suggested Europe’s headline inflation rose from 7.5% to 8.1% this month, echoing increases announced in France and Germany during the previous session while topping the market consensus that had been eyeing annual price growth to just 7.7%.

This was higher than some professional forecasters had expected even after taking into account Monday’s numbers from Germany and France. However, core inflation has risen by a smaller percentage, with the annual rate rising from 3.5% to 3.8% and in the process indicating the significant extent to which price pressures in the Eurozone are driven by largely inorganic and imported factors.

Core inflation removes the volatile prices of mostly imported commodities such as food and energy from the consumer basket, so it is seen as a better representation of domestically generated inflation pressures. Energy prices rose at an annual rate of 39.2% in May, up from 37.5%, although the food, alcohol and tobacco sector saw the second strongest increases from already high levels of inflation when it rose from 6.3% to 7.5%.

Core inflation also overlooks alcohol and tobacco prices.

However, being lower compared to the main gauge of inflation will not be comfortable for the ECB as it is close to twice the level of the identical 2% ECB target and is still rising. According to experts, the main concern is about core inflation. The jump from 3.5 to 3.8% today shows that higher input prices are being paid to the consumer at a rapid pace. While sales price expectations from companies eased slightly in May, expectations are that the underlying will remain well above target in the coming quarters as input prices continue to rise.

Yesterday’s data justifies the European Central Bank’s December decision to begin steadily changing its monetary policy in the direction of less stimulus calibration, although it also leaves the bank in a bind. That’s because the data is effectively throwing gasoline into an already fiery board debate about how fast it should move forward.

ECB Chief Economist Philip Lane said: “I think it was important for President Lagarde to put in place a roadmap indicating the end of net asset purchases in July and the end of negative interest rates in September. And it is a strong and appropriate decision, although it is too early to know what will happen next, because it will depend on how the economy develops.” He added, “Normalization naturally focuses on moving in 25 basis point units, so 25 basis point increases at the July and September meetings are a reference pace. In a conversation with Nuño Rodrigo and Laura Salces, he added that any discussion of further moves would have to prove to move more aggressively from this sequence of rallies in July and September.

According to the technical analysis of the pair: Yesterday’s performance confirms the correctness of our expectation that the price of the euro currency pair against the dollar EUR/USD is subject to profit-taking operations at any time. The factors of the US dollar’s ​​strength continue for a longer period and the date for the European Central to raise interest rates is not soon and the continuation of the Russian-Ukrainian war will continue hinder the euro’s future gains. I still prefer to sell EUR/USD from every bullish level and the most notable current highs are 1.0785, 1.0830 and 1.0900 respectively.

On the other hand, according to the performance on the daily chart below, the bears’ control will be strengthened if the support levels 1.0650 and 1.0540 are breached, respectively.

Gold futures contracts continued to achieve their gains, supported by the decline in the price of the US dollar. The gains of the gold price reached the level of 1870 dollars per ounce, then returned to stability around the level of 1858 dollars per ounce.

In general, the yellow metal was trying to withstand in the face of a myriad of developments that would make it difficult for the rise in gold prices, especially on the monetary policy front. It shows the demand that the public has for the precious metal.

All in all, gold prices are now trading at their best levels since May 11, driven by a weaker US dollar. Since the beginning of 2022 to date, the price of gold has increased by more than 1%. Silver, the sister commodity to gold, made modest gains. As silver futures rose to $21.723 an ounce. The white metal has fallen more than 7% over the year and more than 22% in the past 12 months.

Gold was surprisingly resilient during a rally in global financial markets and may have benefited from the weak dollar.

The US Dollar Index (DXY), which measures the performance of the US currency against a basket of major currencies, fell to 102.11 and a weak profit is a good thing for dollar-denominated commodities as it makes them cheaper to buy for foreign investors. Higher Treasury yields capped gold’s rally, with 10-year bond yields at 2.859%. One-year yields rose 2.6 basis points to 2.1026%, while 30-year yields rose 0.4 basis points to 3.07%.

The gold market is usually sensitive to a high interest rate environment because it raises the opportunity cost of holding non-yielding bullion. However, market analysts acknowledge that gold prices have benefited from lower nominal and real rates.

In other metals markets, copper futures fell to $4,335 a pound. Platinum futures fell to $943.40 an ounce. Advanced palladium futures contracts to 1976.00 dollars an ounce.

According to gold technical analysis: On the daily chart below, the price of gold is still in the phase of exiting the bearish channel and moving towards the resistance levels of 1878 and the psychological top of 1900 dollars. This will confirm the stronger control of the bulls on the trend. In general, I still prefer buying gold from every descending level, despite the tendency of global central banks to tighten their monetary policy, which is negative for gold. It finds momentum from other factors, most notably the continuation of the Russian-Ukrainian war and the persistence of the epidemic in the negative impact on the second largest economy in the world.

The closest support levels for gold are currently 1848, 1832 and 1820 dollars, respectively. The gold market will be affected today by the reaction of the US dollar to the announcement of the contents of the minutes of the last meeting of the US Federal Reserve.

Our expectations indicate more decline for the index during its upcoming trading.

The Dow Jones Industrial Average declined during its recent trading at the intraday levels, to record losses for the fourth consecutive day, by -0.26%, to lose about 84.96 points. It then went to settle at the end of trading at the level of 32,160.75, after its decline in Monday’s trading by -1.99%.

16 components of the 30 index fell, with the worst affected stocks being financial stocks, amid continuing uncertainty about the economic outlook. The Federal Reserve follows a violent cycle of interest rate increases and other measures aimed at curbing inflation, which is running at its highest levels in more than four years.

With a so-called soft landing, the Fed was able to tame inflation without causing a recession, while a hard landing necessitated the central bank’s control of inflation through sharp interest rate increases that lead to a recession.

As for the gainers listed on the index, most of them were technology shares after they found some support from the decline in treasury bond yields, as high long-term bond yields make future profits, which are characterized by technology stocks, less valuable at the present time.

There is one potential catalyst this week that could eventually slow down the selling in the market and that is the US inflation data due to be released later in the day on Wednesday. The CPI is expected to have declined to 8.1% in April from the 8.5% reading the previous month. Low inflation is the only thing that can give investors hope.

Technically, the bearish corrective trend dominates the index’s movement in the short term, in light of its being affected by the breach of a major bullish trend line earlier. This is shown in the attached chart for a (daily) period, with the negative pressure continuing for its trading below the simple moving average for the previous 50 days. We notice the influx of negative signals on the relative strength indicators, despite their stability in oversold areas.

Therefore, our expectations indicate more decline for the index during its upcoming trading, especially in case it breaks the current support level 32,000, to target after that the support level 30,547.50.

We expect some increases for the Turkish currency from the current levels before resuming the strong declines.

Today’s recommendation on the lira against the dollar

Risk 0.50%.

Yesterday’s sell recommendation was activated, and it is still trading

Best entry points buy

• Entering a long position with a pending order from 14.88 levels
• Set a stop-loss point to close the lowest support level 14.46.
• Move the stop loss to the entry area and continue to profit as the price moves by 50 pips.
• Close half of the contracts with a profit equal to 75 pips and leave the rest of the contracts until the strong resistance levels at 14.85.

Best selling entry points

• Entering a short position with a pending order from 15.29  levels
• The best points to place the stop loss are closing the highest levels of 15.48.
• Move the stop loss to the entry area and continue to profit as the price moves by 50 pips.
• Close half of the contracts with a profit equal to 75 pips and leave the rest of the contracts until the support levels 14.88

The Turkish lira fell by about half a percent during trading today, Wednesday, as the US dollar continued to rise due to the pressures caused by inflation on the local currency price. Turkey suffers from record levels of inflation, which recorded about 70 percent during the past month, according to the latest data issued by the country’s statistics office. The rise in the price of fuel and energy imports in general has been the main driver of the rapid rise in inflation rates in the country. The war in Ukraine had caused major increases in fuel and food prices globally and in Turkey, which prompted the Turkish Central Bank to pump several billions of dollars to government institutions during the previous months to support energy prices. The lira is not expected to decline in the near term, especially with the monetary policy followed by the Turkish Central Bank under pressure from President Recep Tayyip Erdogan, who refuses to raise the interest rate in the country.

On the technical front, the Turkish lira fell strongly against the dollar during today’s early trading, the pair continued to rise above the moving averages 50, 100 and 200, respectively, on the four-hour time frame as well as on the 60-minute time frame. At the same time, the pair is also trading the highest support levels, which are concentrated at 15.00 and 14.87 levels, respectively. On the other hand, the lira is trading below the resistance levels at 15.29 and 15.50. The pair is trading around 15.29 levels, which represents the 61 Fibonacci level of the descending wave that recorded its top on 12-12-2021 and recorded its bottom on 12-12-2021. We expect some increases for the Turkish currency from the current levels before resuming the strong declines. Please adhere to the numbers in Recommendation with the need to maintain capital management.