A Slow News Day. A Quick Update

The first Tuesday in July was uneventful, largely because the United States was celebrating Independence Day. We therefore should not expect any monumental changes on the market.

Tuesday’s trading in the Asia-Pacific region ended somewhat down amid a number of political challenges related to the new “successful” launch of an intercontinental ballistic missile by North Korea. Locally, this strengthened the Japanese yen: the USD/JPY pair took off from a local high at 114 and is still steadily heading toward the 113 mark. Sluggish trading in the United States was unable to alter the current trend, but the situation might change a little on Wednesday, since a number of important pieces of news will come out in the United States, including news of oil inventories.

With the strengthening yen, Japan’s Nikkei 225 fell 0.12%, Hong Kong’s Hang Seng by 1.53%, China’s Shanghai Composite by 0.39%, and South Korea’s KOSPI by 0.6%.

Brent crude successfully breached $49.50 and is trading up on the way to $50. Despite the upswing, investors are waiting for data on US oil inventories. Lack of trading on Tuesday also propped up prices for North American oil: the WTI is also trading up, at around the $47.25 mark, and is likely to pass $47.50 on Wednesday.

Gold regained some of its losses on Monday and half of Tuesday: Gold is again approaching $1225, trading just a dollar lower. The uncertainty around the US dollar because of low liquidity is preventing gold from falling farther, although this has not affected European currencies: the EUR/USD pair is trading down at 1.134 with a target of 1.13. It appears that the correction after the euro’s recent surge is continuing and just might return us to levels below 1.13.

The pound sterling is also weakening: the GBP/USD pair broke through the key 1.2955 top down and is approaching the 1.29 mark.

Yuri Prokudin, Olymp Trade analyst

Olymp Trade Review