The markets began the day with a hawkish sentiment from the previous day's FOMC minutes. As the North American session progressed, the released data continued to calm down the risk inflows. Initial jobless claims were reported at 215K, which is below both the previous and forecasted numbers, and it is the lowest since the spike of claims at 231K. The flash reading of S&P global PMI data exceeded both the previous and forecasted figures. The S&P global manufacturing PMI rose to 50.9 from 50, while the services PMI jumped to 54.8 from 51.3. This significant change in data had a profound impact on the market.
Gold experienced a $50 decrease compared to the day before. Following its peak at approximately 2450, gold entered a phase of correction due to reduced expectations of rate cuts and profit taking, resulting in decreased demand for gold. The opening price yesterday was around 2379, briefly touching 2383 before continuing its downward trend in a bearish market pattern with lower highs and lower lows. The release of data exceeding expectations further reduced demand for gold, leading to a continued decline to 2327 by the end of the trading session.
Considering the substantial decline in gold, there is a possibility of a retracement towards the 2350s level, which would establish more favorable price points for sellers to exert downward pressure. Alternatively, if it falls below 2328s, it may revisit the 2307s level.
The release of data resulted in an influx of orders for the Dollar. Initially, it began trading at approximately 104.9s, but then retraced back to 104.7. The positive labor market and economic data led to an increase in demand for the Dollar, causing it to surge to 105.1s. Eventually, the Dollar closed the daily session near its intraday high price points.
Equities have experienced a decline from their record high prices. The Dow Jones index commenced trading at approximately 39598 and saw a slight increase to the 39750s before sellers began exerting downward pressure. The release of positive data sparked increased demand, while concerns about inflation resurfaced. Consequently, the index dropped to around 39000s and concluded the daily session at that level.
Considering the natural order-flow of US30, there is a possibility of a pullback to the 39250s, which could present a more favorable buying opportunity.
Summary:
The USD has strengthened, leading to the USDJPY pair currently hovering around 157 price levels. It is important to remember that the Ministry of Finance/Bank of Japan intervened in the currency markets at the 160 mark during their last intervention.