Should We Be Wary of Price Movements Over the Weekend of the First Week of the Month?

Should We Be Wary of Price Movements Over the Weekend of the First Week of the Month?

02.07.2021

Yesterday, the three major stock indices in the U.S. market all rose, resulting in a market environment characterized by higher stock prices, a stronger U.S. dollar, and stable interest rates.WTI crude oil rebounded and is trading around 75.3, while gold is moving in tandem with the U.S. dollar, rising to $1,779. The yield on the 10-year U.S. Treasury note is trading sideways and currently stands at around 1.46%.

While yields on long-term U.S. Treasuries continue to face resistance on the upside, the U.S. dollar remains firm. The Dollar Index has continued to rise, reaching 92.5—a level not seen since April 6 of this year. Coupled with the pound’s weakness, the GBP/USD pair has plummeted to 1.375.From a technical perspective, with no support until 1.366 on the daily chart, this is a situation where we need to pay close attention to today’s U.S. employment report. Additionally, the Canadian dollar is showing strength similar to that of the U.S. dollar. The USD/CAD pair surged sharply during U.S. trading hours yesterday, briefly rising to 1.244, but as it is currently declining on the 4-hour chart, this is a situation worth watching.

Today’s economic indicators include French government spending at 15:45, the Eurozone Producer Price Index at 18:00, and—during U.S. trading hours—the Canadian trade balance and housing permits at 21:30,remarks by ECB President Lagarde, U.S. employment figures, and the U.S. trade balance, followed by the U.S. manufacturing orders index at 23:00. We will be closely monitoring price movements as we head into the weekend of the first week of the month.