Market participants may be on alert following the release of the U.S. ISM Non-Manufacturing PMI

Market participants may be on alert following the release of the U.S. ISM Non-Manufacturing PMI

06.07.2021

Yesterday, European markets saw rising stocks, a weaker euro, and flat commodities. With U.S. markets closed, trading was characterized by low volatility. The VIX (fear index) remained at a low level of 15.0. Gold rose toward its 20-day moving average and is currently trading around $1,798.

In the foreign exchange market, cross-yen pairs are rebounding, with the Australian dollar/yen—a currency from the Oceania region—showing particularly strong gains. On the daily chart, the AUD/JPY pair has been forming higher lows, and during today’s Asian trading session, it has risen to around 83.8, just above the 20-day moving average. Today’s RBA policy rate announcement could provide further clarity on the market’s direction. With crude oil prices surging, this is a time to keep a close eye on the performance of commodity-linked currencies.

Today, at 3:00 PM during Asian trading hours, we have German manufacturing orders and remarks by RBA Governor Lowe; at 5:30 PM during European trading hours, the UK construction PMI; at 6:00 PM, the German ZEW Economic Sentiment Survey, the Eurozone ZEW Economic Sentiment Survey, and Eurozone retail sales; and at 10:45 PM during U.S. trading hours, the U.S. services PMI (final reading).and at 11:00 PM, the U.S. ISM Non-Manufacturing Index. The market consensus for the U.S. ISM is 63.5. We will keep a close eye on the direction of the U.S. dollar while paying attention to the release of these indicators during U.S. trading hours.