The pound is gaining ground on all other major currencies following a weekend dominated by local elections in England and Scotland, with the main takeaways from both being receding political risks for the UK. The outcome of the Scottish election in particular provided support for the pound, as the SNP failed to secure an outright majority, leading most analysts to predict that London will be able to delay a new Scottish independence referendum for at least a few years, reducing the near-term risk of a break-up of the UK and the detrimental impact such an outcome is likely to have on the value of the currency.
Gold has started the new week still in green with fresh gains confirming last week’s bullish scenario and driving the price close to the resistance at $1,840. The positive outlook for gold has been further supported by the dollar’s recent weakness.
Carlo Alberto De Casa– Chief analyst, ActivTrades
Investors remain bullish on the whole commodity sector and oil is proving no exception with further gains today. Moreover, the cyber-attack which has hit Colonial Pipeline is generating further buying. The technical scenario remains supportive as the combination of expectations of economic recoveries and inflation fears are pulling up the price of both WTI and Brent.
European markets fluctuated on Monday as losses in Berlin and Paris were offset by gains from Milan and Madrid. However, these little bearish market corrections, which followed new highs at the end of last week, are likely to be short-lived. Indeed, the disappointing US jobs report on Friday has raised the prospect of continuing stimulus from both the government and the Fed. That said, investors’ focus is likely to remain on monetary policy this week with a batch of speeches from Fed speakers and BoE Governor Andrew Bailey. Investors are also waiting for crucial inflation reports from the world’s two biggest economies, which will go a long way to confirming if fears over inflation are well-placed or not.
Technically speaking, today’s correction is due to most markets facing strong resistance following last week’s rally. The FTSE-100 Index is trading below the upper band of its bullish channel with new supports generated at 7,105pts, 7,065pts and ultimately 7,035pts.
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.
