The stock market in the United States has once again experienced significant sell-offs, leading to a decline in the Nasdaq index which has hit its lowest point in the past six months. The ongoing policies of President Donald Trump, often referred to as “Trumpcession,” are seen as a major driver triggering the risk of a recession in the country.
GOLD
The price of Gold (XAUUSD) fell by more than $20 or 200 pips, settling around $2,889 per troy ounce at the beginning of last week. This drop in Gold prices is particularly noteworthy as it occurred amidst pressure on both the dollar and the US stock indices.
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Typically, Gold is considered a safe haven asset, which tends to thrive under such conditions. As a result, Gold prices rebounded to over $2,900 per troy ounce in today’s trading session.
This sentiment is likely to continue influencing Gold’s movements during the European trading session.
OIL
Oil prices (CLS10) dropped by $1.15 to $65.89 per troy ounce in early trading last week. Early this morning, Oil prices fell again to $65.28 per barrel before recovering to $66.06 per barrel.
The looming risk of a recession in the United States is making Oil prices approach the lowest levels seen in nearly two years. Additionally, OPEC+ has announced plans to increase production next month, further contributing to negative market sentiment.
This sentiment is expected to continue impacting Oil prices during the European trading sessions.
EURUSD
The EURUSD pair experienced high volatility on Monday, ultimately closing unchanged at 1.08356. It remains near a four-month high, buoyed by positive sentiment from Germany’s fiscal reform plans.
On the other hand, the US dollar faces economic slowdown risks, suggesting that EURUSD could continue to perform positively during European trading hours.
GBPUSD
The GBPUSD pair faced profit-taking pressure, closing Monday’s trading at 1.28777. This represents a drop of 442 points (44.2 pips) compared to Friday’s trading close, following a recent peak at a four-month high.
GBPUSD tends to follow trends in EURUSD as fiscal reforms in Germany may also impact the European economy, which can influence the UK. Therefore, if EURUSD rises again, GBPUSD has the potential for positive sentiment.
USDJPY
The USDJPY pair decreased by 784 points (78.4 pips) to 147.253 on Monday, continuing its decline today to 146.540. This marks the lowest level in six months.
This movement indicates pressure on the dollar due to the risks associated with an economic slowdown in the US. This sentiment is likely to continue affecting USDJPY fluctuations throughout the day.
Nasdaq
On Monday, the Nasdaq index dropped 727 points, with a further decline of 328 points this morning to 19,143. This level is the lowest seen in six months, following which the Nasdaq rebounded to 19,493.
As mentioned earlier, the Nasdaq is under pressure due to the risks related to potential economic slowdowns in the US. This sentiment is expected to keep influencing the Nasdaq’s movement during the European trading session.
