European stock markets were mixed on Monday with German DAX edged lower
by 0.08% and British FTSE 100 up by 0.12%, futures on U.S stock indices were
almost unchanged.
Neutral dynamics of stock indices was expected as the Independence Day
was celebrated yesterday in the United States and stick exchanges were closed.
Market were unable to move in either direction without U.S. investors. So,
today we may see the true beginning of the week upon American liquidity would
return to the market. And we may expect higher volatility today after the long
weekend in the United States ahead of the FOMC minutes that is due to be
released on Wednesday.
Retail trader may expect more trading opportunities, but also they
should be cautious ahead of the FOMC minutes. In this regard any trading
operations should likely to be closed by the end of the trading day as strong
spikes during FOMC Minutes release could be expected.
The U.S. stock market may suffer high volatility too in regard to
signals of tighter monetary policy by the Fed send last FOMC meeting, when
S&P 500 stock index fell by 3% just in two days. This time situation looks
better as S&P 500 index is holding above 4310 points and is likely to move to
the resistance at 4440 points. In the alternative scenario the index may move
below 4310 points with a possible further downside to the support level at 4220
points.
Crude market prices are consolidating around three-year highs with Brent
crude prices hit $77.50 per barrel after OPEC+ failed to raise crude production
quotas in August and by the end of 2021. So, we should not ignore the scenario
of breaking through to the $80.80 per barrel.
Gold prices continue to recover to the upper margin of the trading range
at $1750-1800 per troy ounce following weakening U.S. Dollar and falling
10-year U.S. Treasuries yields to 1.43%. We may expect gold prices to fain by
Wednesday to $1800-1810 per ounce and would further depend from FOMC Minutes
rhetoric.
FX
market has no clear picture as EURUSD may slide lower to 1.15300, but no clear
signs of such movement has been formed. As long as the pair is lower 1.19300
level basic is a downside scenario. But if the pair could hold itself firmly
above this level it may have a chance of the upside movement to 1.20700 or even
1.21600, where sell positions would be interesting to consider.
GBPUSD
has the potential to go lower to 1.37400. If the pair would reach 1.39700 or 1.40200,
sell positions would be reasonable to open with the target at 1.37400.
The
USDJPY is squeezed in-between two important levels. If the pair would surge to
112.00 it would be almost ideal to open sell positions with short term and
midterm target at 109.75.