Recent economic reports from Europe have led to increased volatility in trading on Tuesday (February 17, 2024). The focus has shifted to upcoming economic data from the United States and developments in the Russia-Ukraine peace negotiations.
Here are the details from Trading Central:
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- New York manufacturing activity index (February); forecast 2 vs previous -12.6.
GOLD
The price of Gold (XAUUSD) continues to rise in early European trading, nearing the daily high of $2,915.63 per troy ounce. Gold remains positively influenced by global central banks, which are expected to aggressively purchase gold as a reserve asset this year. This is due to ongoing uncertainties in the economy, particularly concerning trade war risks.
However, if the New York manufacturing data is released higher than forecast this evening, Gold could face downward pressure. A figure above 0 suggests expansion, indicating improved economic activity in New York. Given Gold’s high position, there is potential for profit-taking. Furthermore, if peace negotiations between Russia and Ukraine begin to clarify, profit-taking actions could become more pronounced.
OIL
Oil prices (CLS10) have continued to rise into early European trading, hitting a daily high of $71.99 per barrel.
Nevertheless, the sentiment around Oil remains generally negative due to the potential conclusion of the Russia-Ukraine conflict. Should that transpire, oil supplies from Russia may flood the market again, putting downward pressure on prices.
EURUSD
After previously dipping to 1.04522, EURUSD managed to recover following the release of stronger-than-expected German economic sentiment data. This month’s sentiment was reported at 26, significantly higher than the forecast of 15 and the prior month’s 10.3.
However, EURUSD could experience renewed pressure if US economic data released this evening exceeds forecast.
GBPUSD
GBPUSD has been hovering near the daily low of 1.25913 at the start of European trading despite favorable UK labor data. The employment change for December was reported at 107,000, much better than the forecast of minus 130,000.
Given the positive data, yet GBPUSD remains near its low, any strong US economic data releases could exacerbate selling pressure during tonight’s trading.
USDJPY
USDJPY has reduced its gains in early European trading after previously reaching a daily high of 152.233. The pair surged today after a three-day decline.
Should tonight’s New York manufacturing data surpass the forecast, USDJPY could benefit from additional positive sentiment.
Nasdaq
The Nasdaq has risen, breaking its all-time record by reaching 22,318 at the start of European trading. In comparison to Monday’s closing, Nasdaq climbed by 83 index points.
The Nasdaq’s positive momentum stems from the potential for an end to the Russia-Ukraine war and a reduction in significant trade war risks. This positive sentiment could strengthen if US economic data released tonight exceeds forecast, paving the way for the Nasdaq to set a new all-time high.
