The pound is holding on to the previous session’s gains during early Tuesday trading. Sterling’s recent revival occurs at a time when the number of new virus infections is dropping sharply in the UK, despite the lifting of all COVID-related restrictions on July 19. Such developments represent extremely good news for the country’s economy as the probability of future lockdowns recedes, provided there isn’t a spike in new cases over the next few weeks, allowing for the upgrade of growth forecasts. This scenario is also likely to support the broader risk appetite, as authorities around the world will be looking at the British ‘experiment’ and will be likely to follow suit should the ‘gamble’ pay-off.
Gold crept lower during the early part of Tuesday’s session as investors sit tight ahead of tomorrow’s Fed statement, which is likely to impact the performance of the dollar and therefore that of gold, too, due to the negative correlation between the assets. While gold traders wait for clues from the American central bank on how hawkish its officials really feel, gold trading is likely to remain subdued.
European markets opened lower on Thursday, alongside US Futures, following strong declines in Asia as China continues to weigh down market sentiment. While the second biggest economy in the world started its massive regulatory changes on the tech sector, it has recently spread its reforms to other stocks like real estate and education, which has investors wondering: who is going to be targeted next? This crackdown on private businesses from China is significantly denting market sentiment despite a better-than-expected earnings season so far. Fortunately for traders, strong results from tech and banking shares continue to sustain investors’ risk appetite and counterbalances the negative effect of what’s happening in China. However, the game is set to continue this week with highly anticipated results from the tech giants Apple, Alphabet and Microsoft while a possible tapering discussion from the FOMC looms tomorrow, ahead of the US GDP data on Thursday. This week’s trading environment should stay volatile with a clearer market direction emerging after it.
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.
