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Precious Metals; Stock Indices Trending Higher on lower Interest Rate Expectations

by John Knobel

Trending

  • Gold trending higher on the back of weak economic data adding to expectations that the US Fed will cut interest rates; Trump is seeking to shake up the US Federal Reserve board selecting two new members who are known to be in favour on lower interest rates adding fuel to support gold prices; current price $1,426.25 +$15 last 5 days; a break above $1,445 resistance opens up prospects for a push towards $1,490 price extension; support $1,382

 

  • French CAC40 trending higher consumer cosmetics giant L’Oreal helping to lift the French stock Index higher; European shares are getting support from prospects of easing monetary conditions (lower interest rates expected from the European Central Bank (ECB) adding to the current uptrend across most European major stock markets; French CAC40 current price 5579.50; a break above 5613 resistance opens up potential price extension upwards of 5,750 to 5,855; support 5460;

 

  • EUR/GBP trending higher provided momentum can remain intact a further move higher towards the 0.908 remains on the table; otherwise a test of the 0.887 – 0.88 supports cannot be ruled out;

 

  • Coffee +2.5% last 5 days on cold weather frost in Brazil; the cold weather freeze raising reduced supply concerns that may affect coffee supply’s for the next year crops; the rebound in the Brazil real against the US Dollar also holding back Brazil coffee exports; current price 109.65; resistance at 114.05 needs to be cleared to open up a further advance towards the 119.60 extension; otherwise a test of the lower 105.55 zone cannot be ruled out.

Charts

 

 

 

Upcoming events:

  • Thursday US Independence Day ; US bank holiday

 

  • ***Friday***US NFP (Non-Farm payrolls)  forecast to increase from 160,000 new jobs verses last month’s reading of only 75,000 new jobs; Nonfarm Payrolls measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity. A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

 

  • Levi Strauss & Co. Next Wednesday 10th of July before opening of the US stock market due to report earnings; estimates calling for the company to have earned $0.129 cents per share on $1.296.6 billion in sales over the past 3 months;

Source: FXGM / Bloomberg