GBP/USD: the "Briton" may update the March 2020 low
The British currency is trading in a moderate decline, moving away from trying to consolidate its success since the beginning of the trading week. GBP/USD reached 1.1450 with the prospect of a decline, getting closer to the March 2020 low updated at the beginning of the previous week.
The US dollar gained positive momentum thanks to macroeconomic statistics released earlier. According to the data, the ISM Service Employment Index for August rose to 50.2 points from 49.1 points, while a correction to 48.2 had been expected, the ISM Service Business Activity for the same period rose to 56.9 points from the previous 56.7, while a decrease to 55.1 was expected. Primary service orders strengthened to 61.8 points from 59.9 points previously, contrary to a forecast of a weakening to 57.0 points. Economists noted the strength of the U.S. economy, allowing the national regulator to hold the hawks' course on tightening monetary parameters as part of its fight against record levels of inflation.
- Resistance levels: 1.1531, 1.1600, 1.1647, 1.1700.
- Support levels: 1.1442, 1.1380, 1.1300, 1.1250.
Prices of the precious metal continue to develop a corrective decline within the framework of the "bearish" momentum that came earlier. Strong U.S. statistics released the day before offset attempts of the asset to consolidate near the local high of August 30.
Investors' attention was focused around the release of "Beige Book" data announced the day before - the reporting of the U.S. regulator on a regular basis. Moreover, the Canadian Central Bank will announce its stance on monetary policy correction. According to preliminary estimates, the index is expected to strengthen by 0.75%, up to the target of 3.25%. ECB officials will hold a working meeting on Thursday to announce a decision on interest rate hike, which could rise by 50 basis points to the 1.00% target. In general, the demand for banking metal continues to decline, which is confirmed by the report of the CFTC (Commodity Futures Trading Commission, USA). Thus, the level of contracts on gold by speculators corrected to 117.7 thousand against 125.8 thousand, keeping trends in favor of sellers' deals. The advantage remains with the "bears" in the market, but the "bulls" continue to lose ground, changing the index to 21.925 thousand from 53.688 thousand by the sellers. During the current week buyers liquidated 0.615 deals, sellers - 2.989 thousand.
- Resistance levels: 1700.00, 1720.00, 1730.00, 1752.87.
- Support levels: 1688.58, 1675.00, 1660.15, 1644.36.
Oil market review
Within the trading session of Asian region, the price of WTI oil is moving downward correction, being at the level of 85.00, having updated the local minimum of the second half of January.
Because of the news background on the level of demand for the asset, markets ignored the statement of the OPEC +, which declared a firm position to abandon the increase in production by 100,000 barrels per day since early autumn, but even this value is not enough to significantly change trends in the market. It should be noted that the current level of oil production from the cartel is 3.0 million barrels less than the set target. Meanwhile, today investors expect the API (American Petroleum Institute) report on U.S. crude inventory levels for the last days of September 2. The previous swing showed a modest increase of 0.593mmbbl.
- Resistance levels: 86.95, 90.00, 91.93 and 93.97.
- Support levels: 85.00, 83.00, 81.00, 80.00.
NI 225 index review
The Japanese stock market is trading under heavy pressure as global economic indicators fall and the Treasury securities market strengthens. As of today, the NI 225 index is testing the 27420.0 level.
The release of weak data on household spending, which showed a 1.4% monthly drop, put more pressure on the index. At the same time, analysts admit the probability of changing the trend in the instrument as early as Thursday, as the publication of the national GDP data is expected. According to preliminary expectations, the outlook for the value has positive potential and is likely to strengthen by 0.7% for Q2, providing support for a 2.9% annualized GDP, with a 2.2% growth forecast.
- Support levels: 27240.0, 26000.0.
- Resistance levels: 27870.0, 29100.0.