The dollar is losing ground versus other major currencies during early Friday trading. Employment data released on Thursday pointed to a slower than expected recovery in the labor market, which many saw as a sign that the economic rebound in the US is not carrying as much momentum as hoped for. While politicians in Washington continue to procrastinate on releasing much needed fiscal stimulus and with a second wave of the pandemic possibly on its way, the Fed will use every resource at its disposal to provide stimulus, which means more downside risk for the greenback.
The gold price is little changed, continuing the slow dance seen in the last few days around $1,950. Bullion is waiting for new market drivers, as investors seem to have fully priced in the current scenario and the hyper-expansive monetary policies of central banks.
Carlo Alberto De Casa – Chief analyst, ActivTrades
OIL
This week’s oil rally is down is a mix of factors, with the WTI price managing to recover the threshold of $40 and continuing its rally on to $41. Even if fears over hurricane Sally are waning, the price is holding above $41. This comes after the online meeting of OPEC, where Saudi Arabia impressed the importance of all members respecting the planned cuts.
The rebound of the last few days confirmed that investors seem quite confident that despite growing numbers of Covi-19 cases, there will not be further generalized lockdown. Moreover, investors are betting on the solidity of OPEC+. Technically we will have space for further recoveries if the WTI price clears the resistance placed at $42, even if a consolidation pause seems most likely after this rally.
Carlo Alberto De Casa – Chief analyst, ActivTrades
Disclaimer: opinions are personal to the authors and do not reflect the opinions of LeapRate. This is not a trading advice.
