EUR/USD sub-1.18 after US CPI

Don’t try to beat the competitors at their own game. You have to invent a new game — and master it. Reid Hoffman (LinkedIn)

 

 

HEADLINES

 

 

• EUR/USD drops to multi-month lows below 1.1800 as USD regathers strength
• USD/CAD retreats toward 1.2500, holds onto daily gains
• Oil Rebounds on US Crude Draw Forecast 
• Gold flat as firm dollar offsets jump in US inflation
• Dow slips from record as hot inflation report overshadows strong earnings
• S&P Dow Jones Launches 5 More Crypto Indexes; One Tracks 240 Coins
• CPI report unlikely to sway Fed officials in their thinking on inflation – Wells Fargo

 

 

FOREX

 

 

EUR/USD drops to multi-month lows below 1.1800 as USD regathers strength

 

The EUR/USD pair dropped below 1.1800 in the early American session following the US inflation report but managed to stage a recovery toward 1.1840. With the greenback regaining its strength in the last hour, the pair turned south once again and was last seen trading at its lowest level since early April, losing 0.66% on the day at 1.1782.

 

USD/CAD retreats toward 1.2500, holds onto daily gains

 

The USD/CAD peaked after the beginning of the American session at 1.2539, boosted by a stronger dollar on the back of higher-than-expected US inflation data. During the American session, the pair pulled back toward 1.2500, trimming gains. The intraday bias continues to point to the upside.

 

 

COMMODITIES

 

 

Oil Rebounds on US Crude Draw Forecast 

 

Oil prices rebounded Tuesday as market bulls looked forward to data likely to show another draw in US crude stockpiles. But any disappointment over the numbers due from industry body API, known in full as the American Petroleum Institute, could send prices lower in after-hours trade.

 

Gold flat as firm dollar offsets jump in US inflation

 

Gold was little changed on Tuesday as a firmer dollar offset support from bets that the Federal Reserve was unlikely to respond with immediate monetary tightening after U.S. consumer prices rose by the most in 13 years last month.

 

 

STOCKS

 

 

Dow slips from record as hot inflation report overshadows strong earnings

 

The Dow Jones Industrial Average slipped from its high as a hotter-than-expected inflation report overshadowed a strong start to second-quarter earnings season on Tuesday. The Dow shed about 70 points, or 0.2%, after closing at a record just shy of 35,000 the day prior. The S&P 500 traded around 0.2% lower after reaching a new intraday record earlier in the session.

 

 

CRYPTO

 

 

S&P Dow Jones Launches 5 More Crypto Indexes; One Tracks 240 Coins

 

S&P Dow Jones Indices on Tuesday rolled out five new cryptocurrency index products, the first major expansion of its digital assets benchmarking tools since entering the market in May. Headlining the tranche is a “broad digital market,” or BDM, index that includes over 240 coins, a press release said. 

 

 

ANALYSIS

 

 

CPI report unlikely to sway Fed officials in their thinking on inflation – Wells Fargo

 

“The Consumer Price Index (CPI) surged 0.9% as the costs of fully reopening an economy continue to mount. Over the past year, inflation is up 5.4%, a feat made all the more impressive by base effects beginning to get harder after prices first started to rebound last June.”

“Despite the larger-than-expected gain in prices, today's report is unlikely to sway Fed officials in their thinking on inflation. Outsized gains tied to relatively small components continue to support the view that the current degree of inflation is transitory, but with price pressures broadening out, questions continue to swirl around when and to what extent inflation will eventually settle down.”

 

 

CHART

 

 

Euro / Japanese yen – Daily Candlesticks

 

Source: GKFX Prime Metatrader 4

EUR/JPY has broken a long-term rising trendline and has just rebounded off the 50% retracement level. A break lower sees potential support at the 61.8% and then 78.6% level. - Prepared by Trading Writers*

 

 

CALENDAR

 

 

*Times in GMT

Source: FX Street Economic Calendar

 

SOURCE

https://www.fxstreet.com/economic-calendar
https://www.fxstreet.com/news/us-cpi-report-unlikely-to-sway-fed-officials-in-their-thinking-on-inflation-wells-fargo-202107131539
https://www.fxstreet.com/news/eur-usd-drops-to-multi-month-lows-below-11800-as-usd-regathers-strength-202107131813
https://www.fxstreet.com/news/usd-cad-retreats-toward-12500-holds-onto-daily-gains-202107131656
https://www.investing.com/news/commodities-news/oil-rebounds-on-us-crude-draw-forecast-2556986
https://www.coindesk.com/sp-dow-jones-launches-5-more-crypto-indexes-one-tracks-240-coins
https://www.cnbc.com/2021/07/13/gold-markets-us-inflation-data-federal-reserve.html