- US stocks under pressure
- Gold and oil momentum slows
- Dollar edges up as investors await FOMC Minutes
With US investors returning to the market after a long weekend, we see increased market volatility. Larger price movements are associated with risk aversion, which contributes to a significant decline in bond yields. Still we also observe a decline in the price of gold and the strengthening of the US dollar, which is similar to the previous year, when the market behaved very strangely due to the spread of the pandemic. It is possible that the market is now concerned about the 4th wave of the coronavirus.
Gold fell below $ 1,800 an ounce, and oil erased most of the gains from July. WTI fell from local highs above $ 76 per barrel and is currently trading around $ 73 per barrel. The date of the next round of negotiations on the OPEC + agreement has not yet been announced, although the Biden administration is currently monitoring the situation. Biden does not want the situation in the East to worsen, although at the same time he would like fuel prices to drop slightly.
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Create account Try a demo Download mobile app Download mobile appOn the data front, the ISM index for services dropped significantly to 60.1 points today from 64 points. Interestingly, the employment sub-index fell below 50 points, although the NFP data were positive.
The S&P 500 tested the support around 3,300 points and the VIX index bounced off the recent extreme lows. Wall Street earnings season is about to start soon, while tomorrow's Fed minutes may further increase volatility.
USDJPY broke below psychological support at 111.00 during today’s session and is approaching a long-term upward trendline. Should a break lower occur, then downward correction may be extended towards next major support at 110.00 which is strengthened by 50 SMA (green line). Source: xStation5
