Start of week as a whole, was quite positive, despite the fact that Monday opened a gap down the EUR / USD and USD / JPY on the results of the Greek vote. However, in the afternoon, all the negativity has been neutralized, which contributed and hope that Athens still agree with the “threesome” after the departure of Varufakis and rather weak data on business activity in the US service sector, pressured on the USD.
Stock indices were also able to recover from the initial sales, but commodity markets remained a stronghold of the negative. Brent crude oil sliding to three-month low of 56.38 dollars per barrel, and gold – came to $ 1162.89 per ounce.
Chart of the day:
|Brent crude oil chart|
- Greece voted against the EU proposal. 61% of the population voted in such a way
- Finance Minister Janis Varufakis resigned, which was seen as a signal to an agreement the EU.
- US June ISM index in the service sector 56 vs. 56.2
Recall that both China and Europe is a net importer of oil, and thus, the threat of recession could mean a decrease in demand for energy. Thus, in the short term it makes sense to hold a bearish strategy, but for long-term players in the current levels look attractive entry points for the purchase, as panic and Greece, and on the Chinese stock market could quickly evaporate.
Commodity currencies continue to incur losses under the influence of low commodity prices, but the greatest pressure on their shoulders feel the Australian dollar – it has fallen to a more than 6-year low against the US currency. Last week, data on the trade balance of Australia was worse than expected. Retail sales also fell short of expectations.
And today, we have to learn and decision of the Reserve Bank’s monetary policy. Despite the fact that the expectations indicate a constant level, it is quite possible we will hear next hints of “too expensive currency” that is able to send the AUD / USD to 0.7460. And if the Chinese Shanghai Composite stock index will continue to fall, it is possible testing 0.74.
Warning: Profitability in the past does not mean profitability in the future. Any projections are for informational purposes and do not guarantee the results obtained.