Market Update – July 29 – Stocks Up, USD lower on final trading day of the month

USDIndex sinks again tanked to 105.75, from 106.80.  The US is in a technical recession (2 consecutive quarters of contraction) Q2 GDP -0.9% (Q1 -1.6%), and GDP Inflation rose to 8.7% from 8.0%) but Unemployment remains very low and job creation (Claims fell to 256K from 261k) and wage growth are strong.  US Stocks rallied another 1%+ on expectations of slower rate hikes. AMZN +1.08% & APPL+0.36%, both beat Earnings after hours, shares were up 3% & 12%, respectively. Meta -5.2% & QCOM -4.54%.  Asian markets mixed (Hang Seng -2.02%, Nikkei -0.03%). European FUTS higher. Yields continue to see-saw, today -1.94%, Oil under $97, Gold breached $1760  and BTC moved up to $24k.

Biden & Xi Biden & Xi meeting skirted Taiwan talk, Ukrainian forces plan counterattacks in the South, Russia shells Kiev.

• USDIndex weakens further to 105.45 now. YEN outperforms again in Asian session.
• Equities – USA500 closed higher +48.8 pts (+1.21%) (4072), US500FUTS at 4105 now. Bears being squeezed, 10 days north of 20-day MA. 4175 next key resistance 
• Yields 10-year yield dived into close to 2.681%, recovered to 2.67% now. 
• Oil – peaked at $99.80 yesterday down to test $96.00 before recovering to $97.00 now. 
• Gold – breached & broke key 20-day MA ($1745) and $1750. Trades at $1765 now.
• Bitcoin also rallied on weaker USD to trade at $24.1K now. 
• FX Markets – EURUSD rallied to test 1.0250 on EZ are news, USDJPY dived 1% under 133.00 to 132.75. Cable broke 1.2200 and trades at 1.2225.  

Overnight – JPY Tokyo Inflation hotter, Retail Sales, Housing Starts & Consumer Confidence weaker, AUD PPI inline, French GDP better, German Import Prices in line.

Today – German Flash GDP & Unemployment, EZ Flash CPI and Flash Q2 GDP, US Jun PCE, US Chicago PMI, Canadian GDP.

Biggest FX Mover @ (06:30 GMT) USDJPY (-1.13%). Breached key technical level at 133.00 today and tests 132.50. MAs aligned lower, MACD histogram negative & falling, RSI 31.55 & falling,  H1 ATR 0.361, Daily ATR 1.225.

 

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Stuart Cowell

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