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Stocks & Crude Smacked by Delta & OPEC

“Most great people have attained their greatest success just one step beyond their greatest failure.”  - Napoleon Hill

 

 

HEADLINES

 

 

  • U.S. dollar, yen advance as Delta variant dampens risk appetite
  • GBP/USD falls below double-bottom, lowest since February on souring market mood
  • Perfect Storm Hits Oil as OPEC Deal Collides With New Covid, Growth Worries 
  • Gold down a second session as COVID delta variant’s spread helps support the dollar
  • S&P 500 Slumps as Covid Resurgence Rattles Stocks
  • Bitcoin Drops as Investors Buy $22K and $20K Puts
  • S&P 500 Index to begin a summer correction lower towards support at 4226 – Credit Suisse

 

 

FOREX

 

 

U.S. dollar, yen advance as Delta variant dampens risk appetite

 

The safe-haven U.S. dollar, yen, and Swiss franc rose on Monday as investors grew nervous about a raging coronavirus variant that could threaten the outlook for a global economic recovery. The three currencies firmed as benchmark U.S. The greenback climbed to a more than three-month peak against a basket of major currencies, but has come off its highs as the yen and Swiss franc gained with the worsening in risk sentiment. 

 

GBP/USD falls below double-bottom, lowest since February on souring market mood

 

GBP/USD has tumbled below 1.3670, the double-bottom that was formed early in the spring. It is trading at the lowest since early February, a five-month low.

Sterling is experiencing a free-fall on Freedom Day – when the UK has reopened the economy despite rising COVID-19 cases. The rapid spread of the Delta coronavirus variant in Britain and most of the world has soured market sentiment. The damp mood is boosting the appeal of the safe-haven US dollar.

 

 

COMMODITIES

 

 

Perfect Storm Hits Oil as OPEC Deal Collides With New Covid, Growth Worries 

 

No sooner had the Saudi energy minister and his 22 colleagues in the global oil production cartel announced output hikes on Sunday for August, crude prices saw their worst plunge since March, falling more than 7% just after New York’s lunch hour Monday.

Analysts said the problem wasn’t with the hike announced by OPEC+, which was very much within market expectations. What crushed the market was the resurgence of Covid cases, in the form of the Delta variant of the virus, and the impact that could have on global growth.

 

Gold down a second session as COVID delta variant’s spread helps support the dollar

 

Gold futures mark a second straight decline on Monday, amid a mild strengthening of the U.S. dollar and a sharp global selloff of equities, partly prompted by renewed concerns about the spread of the COVID-19 delta variant.

 

 

STOCKS

 

 

S&P 500 Slumps as Covid Resurgence Rattles Stocks

 

The S&P 500 plunged Monday as sharp fall in yields signalled fresh fears about the growth outlook at time when the Delta variant continues to spread.

The S&P 500 fell 2%, the Dow Jones Industrial Average fell 2.5%, or 852 points, the Nasdaq was down 1.4%. This backdrop of worries has muddied the outlook for growth, prompting a sharp decline in Treasury yields, and pressuring cyclical stocks including financials and energy.

Energy fell more than 4% as U.S. oil prices dropped below $70 level after OPEC and its allies agreed to lift output at time when the delta Covid variant casts doubt on global demand.

 

 

CRYPTO

 

 

Bitcoin Drops as Investors Buy $22K and $20K Puts

 

Bitcoin is falling a day after the options market saw increased demand for out-of-the-money or lower strike put options at $22,000 and $20,000.

The leading cryptocurrency was trading at a three-week low of $30,700 at press time, representing a 3.5% drop on the day. The decline has flipped the crucial 50-week simple moving average (SMA) support of $32,250 into resistance.

 

 

ANALYSIS

 

 

S&P 500 Index to begin a summer correction lower towards support at 4226 – Credit Suisse

 

“A poor end to the week for the S&P 500 has further reinforced the recent rejection from just shy of the psychological 4400 resistance barrier accompanied by daily and weekly bearish RSI momentum divergences. This is seen adding further weight to our view that we are close to the beginning of a summer corrective phase… Below 4289/88 can confirm a top, with support then seen next and initially at 4267/66 and with the 63-day average now at 4226.” 

 

 

CHART

 

 

WTI Crude Oil – Weekly Candlesticks

Source: GKFX Prime Metatrader 4



WTI SPOT tumbled below rising trendline support on price and RSI. After holding below long term resistance at 76, oil has dropped 10 and is testing old resistance at 66 as support. - 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/sp-500-index-to-begin-a-summer-correction-lower-towards-support-at-4226-credit-suisse-202107191303
https://www.fxstreet.com/news/breaking-gbp-usd-falls-below-double-bottom-lowest-since-februay-202107191454
https://www.investing.com/news/commodities-news/perfect-storm-hits-oil-as-opec-deal-collides-with-new-covid--growth-worries-2561748
https://finance.yahoo.com/m/f597c5b5-4699-3c5d-8c2d-67d6b21d4fdf/gold-down-a-second-session-as.html
https://www.investing.com/news/stock-market-news/sp-500-slumps-as-covid-resurgence-rattles-stocks-2561898
https://finance.yahoo.com/news/forex-u-dollar-yen-advance-201145131.html?.tsrc=fin-srch

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