The XAU/USD pair is consolidating near $1,955. The main catalyst for the XAU growth was the decline of the dollar. Let us recall that pressure on the US currency was exerted by macroeconomic data such as the consumer price index, which fell from 4% to 3% in June. On Thursday, investors paid attention to data on the producer price index, which also fell from 0.9% to 0.1% year-over-year. Against this backdrop, analysts have revised their expectations regarding further tightening of the Fed’s monetary policy. Now, they expect only one increase in interest rates by the end of the year. Gold was also supported by a decline in US Treasury yields. Typically, US Treasury bonds are considered an alternative to gold. However, over the week, the yield on 2-year bonds decreased by 6% and 10-year bonds – by 3%, increasing the attractiveness of gold, which rose by 3% over the same time. Against this backdrop, long positions on gold remain a priority.
BUY STOP 1955/TP 1975/SL 1948
EUR/USD
The EUR/USD pair is trading near 1.1200, holding at the highest level since February. Amid a significant decline in the US dollar, investors continue to redirect their capital to more attractive assets, such as the euro, as the European Central Bank (ECB) has not announced the end of hawkish rhetoric. In addition, inflation in the Eurozone is not declining as fast as in the US, now standing at 6.1%, well above the 2% target. If the consumer price index remains high, the regulator will be forced to raise the rate several more times, which will support the euro. At the end of last week, the euro was backed by May statistics on the volume of industrial production in the EU, which grew by 0.2%, easing recession concerns. If market sentiment does not change, the EUR/USD pair may rise above 1.1300.
BUY LIMIT 1.1200/TP 1.1300/SL 1.1170
AUD/USD
The AUD/USD pair is trading at 0.6800. The Reserve Bank of Australia (RBA) is expecting a new governor. In September, Michelle Bullock, the Deputy Governor at the Reserve Bank of Australia, will take over as governor. Experts believe there will be no significant changes in the department’s policy. Earlier, the official said that the main goal of the RBA is to return inflation to the target level of 2%. Market participants believe that the RBA will continue to raise the rate, as monetary tightening remains the most important tool for stabilizing consumer prices. Given the above, the Australian dollar will retain its growth potential and may exceed 0.6900 in the near future.
BUY STOP 0.6850/TP 0.6950/SL 0.6820
