Gold remains bid near the $1725 per ounce, as investors believe that the upside potential could be unlocked with a renewed landslide across
global equities. Yet, anything less than a sizeable and durable risk sell-off should maintain the top-sellers in place approaching the
$1750 mark.
The foreign exchange markets saw little action in the overnight trading session.
The euro’s failure to
beat the $1.10-offers (the 200-day moving average and solid psychological resistance) last week continues pulling the single currency
lower against the greenback. The EURUSD is testing 1.0880, the 50-day moving average support, on firming US dollar demand. The latest CFTC
data printed a third consecutive week retreat in long EUR speculative positions, while the solid positive skew in euro positions hints that
there is potential for a further euro sell-off if renewed risk-off moves rekindle a flight to the USD safety.
Cable finds support near the
1.2160/1.2170 area, but there is a mounting selling pressure due to the political shenanigans in the UK. Boris Johnson, who hasn’t sacked
Dominic Cummings on his long-distance travels during the coronavirus lockdown, now faces critics and even a revolt from the Tory MPs.
Combined with a stronger US dollar, cable could pull out the 1.2075 May support and extend losses toward the 1.20 mark.
WTI crude
consolidates gains near the $33 a barrel as demand picks up on global business reopening and improved economic activity. Though the
US-China tensions could slow down the pace of the recovery, the improvement in basic energy demand should continue keeping the short-term
trend on a positive path and give support to WTI near the $30 per barrel.
By Ipek Ozkardeskaya
