USD Index Market price is moving in Ascending channel and market has reached higher low area of the channel
The US Dollar Takes a Breather at the Start of July
The US Dollar Eases
The US Dollar (USD) has started July on a softer note. This shift comes amidst a jam-packed US economic calendar, with the much-anticipated US Jobs Report looming. The US Dollar Index, which measures the value of the dollar against a basket of foreign currencies, has pulled back to the mid-105.00 range. On Monday, the Euro took the lead, driven by the recent French government elections.
French Elections: A Mixed Bag
The French elections have been a focal point, with Marine Le Pen’s far-right party, Rassemblement National (RN), making significant strides. However, it seems a stalemate is on the horizon. None of the three main parties – Marine Le Pen’s RN, Emmanuel Macron’s centrist Ensemble Citoyens, or Jean-Luc Mélenchon’s far-left Nouveau Front Populaire – have met their projected targets according to the latest polls. Both the far-left and far-right parties underperformed compared to expectations, while Macron’s party managed to perform slightly better but still came in third. This means that no party holds a clear majority, potentially leading to a political deadlock.
Busy Week for US Economic Data
As US traders digest the results of the French elections, they are also preparing for a week filled with significant economic data. Here are some of the key highlights:
Institute for Supply Management (ISM) Data
- Manufacturing PMI: The ISM is set to release its June Manufacturing PMI data. The previous reading stood at 48.7, and it is now expected to rise slightly to 49. This index provides a snapshot of the manufacturing sector’s health.
- New Orders Index: In May, this index was at 45.4. There is no forecast available for June, but traders will be keenly watching for any changes.
- Employment Index: Previously at 51.1, this index tracks employment trends within the manufacturing sector.
- Prices Paid Index: Expected to decline to 55.9 from 57, this index measures the prices manufacturers pay for raw materials.
USD Index Market price is moving in Ascending channel and market has rebounded from the higher low area of the channel
European Central Bank Symposium
The European Central Bank (ECB) is holding its annual symposium in Sintra, Portugal, often referred to as the European version of the Jackson Hole Symposium. This three-day event will see numerous central bank members and policymakers speaking and providing insights. ECB President Christine Lagarde will deliver the opening remarks, setting the stage for what promises to be a highly informative series of discussions and interviews.
Equity Markets React Positively
The outcome of the French elections has had a notable impact on equity markets. European indices are rallying, with gains exceeding 1%. This positive sentiment has also spilled over into US equity futures, which are benefiting from the upbeat mood in Europe.
USD Index Market price is moving in Descending channel and market has reached lower high area of the channel
Fed Rate Cut Expectations
Interestingly, the CME Fedwatch Tool suggests that a rate cut might be on the horizon despite recent statements from Federal Reserve officials. The tool indicates a 57.8% chance of a 25-basis-point rate cut in September. There is also a 35.7% possibility of a rate pause, while the likelihood of a 50-basis-point cut remains low at 6.5%.
US 10-Year Benchmark Rate
The US 10-year benchmark rate is currently trading near 4.39%, having dipped slightly from its opening level of 4.42%. This movement has been influenced by the French election news and broader market dynamics.
Final Thoughts
As we move further into July, the interplay between political events in Europe and economic data in the US will continue to shape market movements. The US Dollar’s performance, in particular, will be closely watched by traders and investors. With a busy economic calendar ahead and significant global events unfolding, it’s a crucial time for those in the financial markets to stay informed and agile.
Don’t trade all the time, trade forex only at the confirmed trade setups
Get more confirmed trade signals at premium or supreme – Click here to get more signals , 2200%, 800% growth in Real Live USD trading account of our users – click here to see , or If you want to get FREE Trial signals, You can Join FREE Signals Now!
