Ethereum smashes through $4000

“The time to buy is when there’s blood in the streets.” - Baron Rothschild

MARKET NEWS

Ethereum, the world’s second-largest cryptocurrency, soars above $4,000 for the first time - CNBC

Ether, the digital token of the Ethereum blockchain, rose to an all-time high of $4,196.63 at 12:15 p.m. ET, according to Coin Metrics. It now has a total market value of $483.4 billion, less than half bitcoin’s $1.09 trillion.

Dow Snaps 5-Day Win Streak as Tech Wreck Dents Bullish Stampede – Investing.com

The Dow Jones Industrial Average fell 0.1%, or 35 points, but was earlier up more than 300 points hitting an intraday record. The S&P 500 was down 1%, and the Nasdaq Composite slumped 2.6%. The rotation from tech to economically sensitive cyclicals areas of the market continued as investors shun longer-duration growth stocks amid ongoing inflation pressures and worries about an eventual Federal Reserve.

FOREX

Sterling Surges Above $1.41, Helped by Scotland Relief and Dollar Weakness - Reuters

The pound climbed to as high as $1.4158 on Monday, its strongest in more than two months, fuelled by a combination of dollar weakness, improved economic forecasts, lockdown easing measures, and market relief about the outcome of the Scottish election.

Dollar hovers near 10-week lows as inflation expectations skyrocket – Reuters

The dollar languished at around 2-1/2 month lows on Monday as investors bet that rising inflation would erode the currency’s value as the U.S. Federal Reserve maintains its loose monetary policy. The five-year breakeven inflation rate - which measures expectations of inflation five years out - reached its highest since April 2011 on Monday.

USD/JPY Pares Post-NFP Decline as US Treasury Yields Recover – Daily FX

USD/JPY attempts to retrace the bearish reaction to the 266K NFP print amid the rebound in longer-dated US Treasury yields, and the exchange rate may face range bound conditions ahead of the key data prints on tap for later this week as it struggles to extend the series of lower highs and lows from the previous week.

GOLD

Gold extends climb to highest level since February as dollar sinks to 2 1/2-month low – Market Watch

Gold prices climbed on Monday, headed for a fourth consecutive gain, supported by a fall in the U.S. dollar to a roughly 2 1/2-month low, as well as some weakness in the stock market. A weaker dollar can help to support buying in commodities priced in the currency for overseas investors.

MORE HEADLINES

•    FDA permits use of the Pfizer-BioNTech Covid vaccine in kids ages 12 to 15 - CNBC
•    Cathie Wood’s ARK Innovation ETF falls to new low for the year, off nearly 35% from recent high – CNBC
•    Novavax delays COVID-19 vaccine production timeline, sees filing for authorization in 3rd qtr
•    World's US dollar reserves hit 25-year low – Axios
•    Colonial Pipeline aims to be "substantially" back online by end of week - Axios

ANALYSIS

3 reasons to stay positive on risk assets - Citi

Citi discusses the broad market conditions and stays constructive on risk assets.

"CitiFX Strategy maintains its positive view on risk assets, based on i) a dovish Fed, ii) a benign macro outlook, and iii) a view that market positioning is not yet stretched, despite slightly weaker equity prices last week and the underwhelming headline NFP number," Citi notes. 

"In line with our view, recent Fedspeak confirmed its dovish stance and confirms that the June FOMC is probably too early for a taper warning, which, along with rising commodity prices, led to elevated inflation expectations and depressed real yields," Citi adds. 

CHART

GBP/JPY – Weekly Candlesticks

  
Source: GKFX Prime Metatrader 4 

GBP/JPY broke above previous resistance and the 150 round number, re-tested it as support and has now made new highs on the weekly chart, suggesting the currency pair might be forming a long term bottom. - Prepared by Trading Writers*

CALENDAR

*Times in GMT

 
Source: FX Street Economic Calendar