AUD/NZD is flat in the Tokyo open and has ranged between 1.1091 and 1.1115 on the day so far following the Reserve Bank of New Zealand's inflation expectations at the start of the week and solid Chinese data. 

Analysts at Westpac explained that the easing in inflation expectations will leave the RBNZ feeling more comfortable that the risks of high inflation becoming embedded in the economy are easing off. ''That is particularly important given the current multi-decade high in actual inflation and related risks of a wage-price spiral,'' the analysts said.

However, the analysts also explained that the survey ''still points to strong inflation pressures in the New Zealand economy and reinforces the case for rate rises. We’re forecasting another 50bp rise at next week’s RBNZ policy meeting.''

Meanwhile, the Kiwi recovered and has fully erased snap losses seen in the wake of strong US Nonfarm Payrolls data from Frida. US bond...

EUR/USD remains sidelined after trimming the week-start gains. Italian politics, German gas crisis and US-China tussles over Taiwan seem to challenge bulls. Firmer EU Sentiment data, downbeat yields restrict downside momentum. Second-tier employment-related US data will join risk catalysts to direct short-term moves.

EUR/GBP is facing hurdles around 0.8440 as investors await Wednesday’s Germany HICP. The German inflation data is likely to remain unchanged at 8.5% annually. A vulnerable UK GDP data may weaken the pound bulls ahead.

GBP/USD retreats to 1.2085 after a mildly positive start to the week, sidelined during Tuesday’s initial Asian session. In doing so, the Cable pair pokes the 200-SMA support while fading the bounce off the 38.2% Fibonacci retracement of June 16 to July 14 downturn.

Given the bearish MACD signals and the recently downward sloping RSI (14), the GBP/USD pair is likely to remain pressured.

However, the aforementioned key SMA and the Fibonacci retracement levels, respectively neat 1.2060 and 1.2000, will be tough nuts to crack for the bears before retaking control.

Following that, a downward trajectory towards the multi-month low marked in July, around 1.1760, can’t be ruled out.

On the flip side, a convergence of the one-week-old descending trend line and the 61.8% Fibonacci retracement level near 1.2160 could restrict the short-term recovery of the GBP/USD pair.

Even if the Cable pair rises past 1.2160, the buyers need validation from the...

Silver price (XAG/USD) steadies around $20.70 during Tuesday’s initial Asian session, after refreshing the monthly high the previous day.

In doing so, the bright metal tracks the cautious optimism in the options market as bulls retreat of late.

That said, the one-month risk reversal (RR) of silver prices, the difference between the call options and the put options, appear to retreat of late. The weekly RR prints 0.0000 figures after easing to 0.420 in the last week, from 0.950. It’s worth noting that the daily options market gauge remains indecisive at 0.000 by the press time.

Given the receding bullish bias in the options market, coupled with the anxiety ahead of the US Consumer Price Index (CPI) for July, up for publishing on Wednesday, XAG/USD prices may find it difficult to extend the latest run-up.

Also read: Silver Price Analysis: XAG/USD jumps back above $20.00,...

WTI grinds higher after bouncing off the key Fibonacci retracement support. Sluggish RSI, MACD challenge further upside momentum but 61.8% golden ratio probes bears. Convergence of 200-DMA, two-month-old resistance line and 50% Fibonacci retracement level restricts short-term upside.

A symmetrical triangle formation after a juggernaut rally hints continuation of an upside. Overlapping 50-EMA and asset’s price indicates short-term consolidation ahead. Aussie bulls will recapture a seven-year high at 96.88 on triangle breakout.

NZD/USD remains sidelined after rising the most in three weeks the previous day. New Zealand Electronic Card Retail Sales improved MoM, dropped on YoY during July. Softer US Treasury yields weighed DXY, China trade numbers favored Antipodeans. Kiwi bears ignored softer prints of Q3 RBNZ Inflation Expectations with eyes on US CPI for July.

For the hourly time frame, it was explained that ''a break to the downside opens the probability of a move into the area of price imbalance. 1.2880 is a potentially key structure that if broken may give way to a deeper correction towards 1.2820 and 1.2770.''

(USD/CAD H1 chart, above, daily chart below)

It was explained that ''the daily chart's W-formation is a bearish feature with price anticipated to correct the daily bullish impulse towards the neckline. ''

The GBP/JPY daily chart portrays the pair as neutral-to-downwards, pierce of 163.00, to send the pair towards the 163.10s area. From a short-term perspective, the GBP/JPY is range bound, but the higher-time frame could lean the pair neutral-to-downwards.

USD/CHF is eyeing the 0.9550 figure, critical support ahead of the US Inflation. Declining oil prices are responsible for lower consensus for US CPI. SNB’s hawkish stance is still fresh despite the unchanged inflation rate at 3.5% released last week.

US inflation expectations, as per the 10-year breakeven inflation rate per the St. Louis Federal Reserve (FRED) data, rose for the second consecutive day by the end of Monday’s North American session. That said, the inflation gauge recently flashed the 2.48% mark, reversing the previous week’s losses of late.

The recovery in the long-term inflation expectations should ideally help the US dollar as traders brace for this week’s US Consumer Price Index (CPI) for July, up for publishing on Wednesday.

Also likely to have underpinned the data could be the recently firmer US jobs report for July and the hawkish Fedspeak. On Friday, the headline Nonfarm Payrolls (NFP) rose to 528K versus 250K expected and 398K upwardly revised prior. Further, the Unemployment Rate also inched lower to 3.5% compared to 3.6% expected and previous readings. Following the data, San Francisco Fed President...

Gold price bounced off 13-day-old support line amid softer US dollar. Market’s preparations for US inflation, pullback in yields and a light calendar favored XAU/USD buyers. Second-tier US jobs numbers, risk catalysts can entertain bulls ahead of US CPI for July.

Volatility contraction escalates on a follow-up Diamond after a consolidation. Overlapping 50-EMA with asset prices is hinting at a sideways move ahead. The shared currency bulls are continuously facing barricades around 1.0200.

AUD/USD grinds higher after the heavy gains amid a lack of major catalysts. China trade data, market’s preparations for US CPI appeared to have favored buyers. Mixed equities probed upside momentum, yields underpinned the US dollar pullback. Australia’s NAB data for July, second-tier US job numbers may entertain intraday traders, Taiwan headlines are important too.

On Monday, the EUR/JPY registered minimal gains of 0.14%. EUR/JPY daily chart depicts the pair as neutral-to-downward biased; however, a break above 137.92 could shift the bias. Short term, the EUR/JPY is neutral-to-upwards, but breaks below 137.06, shift the bias to neutral.

US Treasury yields retreated sharply on Monday, weighing on the dollar’s demand. EU August Sentix Investor Confidence contracted to -25.2, worse than anticipated. EUR/USD is neutral-to-bearish, could accelerate its slide once below 1.0105.

GBP/USD is sensing barricades around 1.2080 as investors await US CPI data. Downbeat oil prices have trimmed US CPI forecasts and Fed’s rate hike hopes. A lower consensus for BRC Like-for-Like Retail Sales in times of higher inflation indicates vulnerable demand.

NZD/USD advances despite a lack of catalyst, lifted by the AUD/USD. Sentiment remains mixed, tilted positively, as shown by the FX space, with safe-haven peers pressured. Fed policymakers are still pushing back against dovish tilt, as money market STIRs odds of a 75 bps hike lie at 90%. RBNZ survey of inflation expectations easied, with 2-year inflation at around 3%.

USD/JPY has been in recovery mode for the best part of a week, but it came up against resistance following last week’s strong July labour market data in the US. On Monday, the pair is ending the New York session flat for the day at around 135 the figure having ranged between 134.34 and 135.58. 

Analysts at ANZ Bank said that despite clear signs of a moderation in Gross Domestic Product growth globally, ''the slower growth and less accommodative monetary environment have yet to show up in increased labour market slack. Until clear evidence emerges that both labour markets and core inflation are moderating, central banks will remain dedicated to getting inflation down, a bias that points to the potential for further large incremental rate hikes.''

The focus for the week ahead will be the July US inflation data in Consumer Price Index that is expected to confirm core inflation (ex-food & energy) rose 0.5% MoM, up 6.1% YoY (5.9%). ''That is way too...

What you need to take care of on Tuesday, August 9:

The dollar eased on Monday as government bond yields retreated, providing support to stock markets. Still, the absence of relevant news maintained US indexes seesawing within familiar levels. European indexes posted modest intraday gains, but Wall Street closed mixed.

Market players hold their breath ahead of the US Consumer Price Index to be released next Wednesday. Concerns about economic growth and aggressive tightening in the US re-surged on Friday after a strong job report. Investors will make a reassessment of the situation after the release of inflation figures.

Tensions between Germany and Russia over natural gas delivery undermined demand for the shared currency. The EUR/USD pair flirted with the 1.0200 level and settled at around 1.0190.

GBP/USD ended the day pretty much unchanged at 1.2075. Commodity-lined...

At $1,787.86, the gold price is firm at the start of the week, trading 0.7% higher having climbed from a low of $1,771.22 to a high of $1,790.04.  However, the $1,800 psychological level remains elusive ahead of a critical inflation report due on Wednesday from the US calendar which could be pivotal for the yellow metal, US dollar and US yields. 

Meanwhile, the US dollar has given back some of the gains made after last week's blockbuster Nonfarm Payrolls data that has soothed some of the fears about an economic slowdown.

Nevertheless, investors remained cautious as the payrolls data added to expectations of a hawkish US Federal Reserve. US rate futures have priced in a 67.5% chance of a 75-basis-point hike at the Fed's September meeting, up from about 41% before payrolls data on Friday beat market expectations.

However, US 10-year yields remain below the recent highs of 2.869% so far. There is daily support in Monday's...

AUD/USD edges up by 1%, boosted by a soft greenback. China’s Trade Balance surplus increased the appetite for the risk-sensitive AUD. The AUD/USD got bolstered by last week’s RBA’s tightening expectations.