Global markets including stocks, commodities and cryptocurrencies had a bearish start to a new week due to mounting worries about higher interest rates and concerns over the surging inflation’s negative impact on economic growth. Moving ahead, one of the key economic data the investors and traders should monitor this week is the latest US consumer inflation figures on Wednesday.
Wall Street extended a sharp selloff on Monday following the mixed comments from the FED policymakers and weaker-than-expected earnings results. The technology and data software company Palantir stock more than 20% on Monday as the company missed estimates in its first-quarter earnings report. On early Tuesday all three US indexes slightly recovered after Monday's drastic declines.
Crude oil prices trading weaker over rising tensions about the recent coronavirus pandemic in China and its impact on the global economy and oil demand. On the other hand, the additional selling pressure is driven after the EU is considering dropping the ban on EU tankers moving Russian oil.
In the currency market, The Japanese yen has strengthened against the US dollar as risk currencies extended losses amid choppy trading and high volatility in the global financial market. Meanwhile, the US dollar index slightly retreated from the fresh 20-year highs.
The safe-haven metal remains under pressure. During the previous session, the metal rebounded back to near $1870 level but later retreated back to near $1850 following the comments from Richmond Fed President Thomas Barkin, he kept the 75-bps interest rate hike on the table.
On the data front, Germany and Eurozone released the latest economic sentiment figures. ZEW Economic Sentiment Index in Germany increased to -34.30 points in May from -41 points in April of 2022. The economic Sentiment Index In the Euro Area increased to -29.50 in May from -43 in April of 2022.
Today, the comments from the Federal Reserve policymakers will be key to watch due to the shortage of releases on the economic calendar.
Worldwide, more than 517 million people have been confirmed infected and more than 6.25 million have died. The United States has confirmed over 81 million cases and has had more than 997,000 deaths from COVID-19, the highest total in the world.
Technical Outlook and Review
EURUSD: For today, the first resistance is located around 1.0600, a break above this level will confirm a possible move to 1.0640/50. On the downside, any meaningful pullback now seems to find some support near the 1.0500 zones
The important levels to watch for today: Support- 1.0530 and 1.0500 Resistance- 1.0600 and 1.0640.
GOLD: Currently the gold price is supported at $1850 levels, any break below this level will open the doors to $1840 and $1826. On the other upper side, the immediate resistance at $1872 and $1890.
The important levels to watch for today: Support- 1850 and 1840 Resistance- 1865 and 1872.
Quote of the day - The best traders have no ego. You have to swallow your pride and get out of the losses.