The Pound remains strongly supported against the euro and the dollar during early Wednesday trading. At the start of the week sterling benefited from the galvanising effect of receding political risks in the aftermath of last week’s elections. The pound has been further boosted by the positive economic data published this morning, giving account of an unexpected resilience in the British economy, with first quarter GDP and manufacturing data surpassing expectations. As the short- to medium-term outlook improves for UK political and economic stability, so do the prospects for the currency, which may lead to further gains for sterling.
Ricardo Evangelista – Senior analyst, ActivTrades
GOLD
Gold remains traded steadily at $1,830, in a solid positive trend. The modest recovery of the US Dollar has not impacted the bullion price, as investors are still seeing gold as an inflation hedge and as a safe haven in case of any further correction of indices.
Technically, a clear surpass of $1,840 could open space for further recoveries, as the peak reached in summer 2020 is still $240 away. A first target could be seen at the resistance zone of $1,870.
The price of Oil is proving resilient to current market drivers. Investors are betting on further recovery in demand and are still seeing some inflation risks. The combination of these two factors, along with the US data regarding oil inventories released by the American Petroleum Institute, showing a decline of supply, are supporting the price, bringing back WTI close to the resistance zone of $66/66.5 a barrel.
European shares traded higher on Wednesday, preventing benchmarks from extending losses registered at the beginning of the week. It’s “inflation day” for most stock and FX traders today, as the US CPI report is due later in the afternoon. Investors are patiently waiting for these data as it will provide them with more hints towards the next move from the Federal Reserve and a possible shift in monetary policies. Although Fed officials already said it would be too soon to reduce monetary support, investors are cautiously assessing price pressure in order to get ready to switch their exposure from growth to more defensive values. Meanwhile, in Europe the Stoxx-50 index successfully rebounded over the lower band of its bearish flag, and the market will next challenge the 3,940 pts resistance before 3,960 pts and 3,980 pts.
Pierre Veyret– Technical analyst, ActivTrades
Disclaimer: opinions are personal to the authors and do not reflect the opinions of LeapRate. This is not a trading advice.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.
