The annual Jackson Hole meeting was held this past weekend in Wyoming where economic and financial professionals and policy makers joined heads to discuss the economic circumstances in the emerging economies. The major theme of this meeting was the ‘impact’ that could have over emerging economies if the Federal Reserve cuts down its monthly stimulus later this year.
The Federal Reserve personnel rejected to take the consequences of bears entering the emerging markets and slowing things down, which could be caused as a result of departure of abundant cash from the market and the increased cost of borrowing. Fed is determined to taper the stimulus later this year, provided the economic indicators continue to show substantial improvement.
Euro remained unmoved so far today in the Asian session where the pair did not even give any downward gap when the market opened and it is currently trading at 1.3379 before the start of the European session.
Provided it breaks below 1.3358 then it may test its next supports at 1.3335 and 1.3320, while breaking of latter support could cause more sellers to enter the market. However, it must break its Friday’s high of 1.3410 in order to target its next resistance levels at 1.3431 and 1.3450.
The British Pound is and will remain under the control of bears as long as it does not move above 1.5622. Currently being traded at 1.5565 the GBP/USD has its support at 1.5540, breaking of which could take it down to 1.5522 and 1.5501.
Considering there is a bank holiday today in the U.K., the market may remain sluggish until the start of the U.S. session, where Core Durable Goods Orders data is due for the U.S.
Gold’s Targets Achieved
As mentioned in our previous analysis report that gold would target 1383 and 1403 resistance levels, once it manages to break and sustain above 1375 level, and so it did. The metal gained its shine on Friday and earlier today where it gained against the U.S. dollar and tested the 1408 level, but failed to sustain at this level and immediately came below the 1400 psychological support level.
The precious metal is currently trading at the 1395 level, where another move above 1403 could take it to test 1422 and 1430. Provided this happens, then its near-term target would be the 200-EMA on its daily chart which is 1460 resistance area. On the other hand, below the 1400 level it could fall back to its previous resistance levels which are now its support areas – 1383 1375 1362.
To contact the reporter of this story: Jonathan Millet at firstname.lastname@example.org