Should investors be wary of price movements over the weekend of the first week of the month?

Should investors be wary of price movements over the weekend of the first week of the month?

02.07.2021

Yesterday, the three major U.S. stock indices 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 $75.30, while gold is moving in tandem with the U.S. dollar and has risen to $1,779. The yield on the 10-year U.S. Treasury note remained flat and is currently 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 extended its gains to 92.5, reaching a level not seen since April 6 of this year. Combined with the pound’s weakness, GBP/USD has plummeted to 1.375.From a technical perspective, there is no support until 1.366 on the daily chart, so this is a situation where we need to pay close attention to today’s U.S. employment report. The Canadian dollar is also strong, much like the U.S. dollar. The USD/CAD pair surged sharply yesterday during U.S. trading hours, rising as high as 1.244 at one point, but it is currently falling on the 4-hour chart, making this a situation worth watching.

Today’s economic indicators include French government spending at 3:45 p.m., the Eurozone Producer Price Index at 6:00 p.m., and—during U.S. trading hours—Canada’s trade balance and housing starts at 9:30 p.m., remarks by ECB President Lagarde, U.S. employment data, and the U.S. trade balance, followed by the U.S. manufacturing orders index at 11:00 p.m.We will be closely monitoring price movements over the weekend of the first week of the month.