By Orbex
USD Lower in Early Trading
The US dollar has started the week on a softer footing with some retracement over the European morning on Monday. Looking ahead to today’s US session, we could see some action with both US ISM Manufacturing and Employment data due. USD index trades lightly ahead of the data and has been capped by the 97.68 level so far today.
EUR Higher, ECB In Focus
EURUSD has opened the week with a better tone, taking advantage of the weakness in USD, trading 1.1180 last. The recovery off the 1.1129 level continues to play out. Trading is likely to remain quiet today as, looking ahead, we have eurozone CPI later in the week with the ECB rate decision due on Thursday.
UK PM Contest in Focus
GBPUSD remains subdued today, despite the weakness in USD. Theresa May is due to formally stand down as PM on June 7th and pressure is mounting to find a replacement. The uncertain outlook for Brexit is keeping GBPUSD weighed down currently. Price is still capped by the 1.2658 level for now.
Risk Recovery Under Way Though Outlook Remains Murky
Risk assets have posted a mild recovery over early European trading today. This comes following a gap down at the open last night as trade war concerns continue to plague investors. SPX500 gapped down below the 2744.13 level and has been capped by the level in today’s trading so far. With neither the US or China looking likely to back down, world growth concerns are once again back in focus.
Gold Rally Continues, JPY Pauses
Safe havens have had a mixed start to the week with gold continuing to explode higher against USD while the JPY has been a little weaker. XAUUSD has continued the moves seen over Thursday and Friday last week, which took price above the 1303.78 level and is now trading en-route to test next resistance at the 1321.52 level. USDJPY has been higher today, however, with the pair recovering off the 108.12 level which it briefly pierced below to trade 108.30 last.
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Oil Recovers Following Shar Declines
Crude oil prices have managed to post a recovery so far today, with price fighting to get back up to the 54.45 level broken last week. US/China trade war concerns remain the key downside force, though for now, it seems we are seeing some stabilization. Tensions in the Middle East continue to offer sporadic upside support as the threat of conflict there continues to grow.
Commodity Currencies Clawing Their Way Back
USDCAD has been weighed on so far today as resurgent oil prices help to boost CAD. Price has backed down once again from the 1.3520 level though with tier one US data due today, there is the risk of a topside run. On the domestic side for CAD traders, we also have manufacturing PMI due.
AUDUSD continues to trade off the .6864 lows. The stabilization in risk assets this morning along with a recovery in oil is helping keep AUD well bid. Price is now trading back up towards the .6982 level which was broken last month. With US/China trade war concerns ongoing, we are likely to see this level hold as resistance if retested.
By Orbex
