Goldman says dollar gains are over

“The value of an idea lies in the using of it.” — Thomas Edison

 

 

HEADLINES

 

 

• Dollar falls to more than 3-week low with payrolls in focus
• Goldman Sachs says Greenback's Rally Likely Done
• Oil settles down 1% as U.S. refineries shut; Washington pushes OPEC to pump more
• Gold ends higher with U.S. consumer confidence at a 6-month low
• S&P 500 Slips, But Monthly Win Streak Continues
• Bitcoin Up in August as 'Impressive Divergence' Points to Gains Ahead
• Powell opens USD selling window but NFP and covid could close it – MUFG

 

 

FOREX

 

 

Dollar falls to more than 3-week low with payrolls in focus

 

The dollar fell to its lowest level in more than three-weeks against a basket of currencies on Tuesday, as investors looked to U.S. jobs figures later this week for insight into the possible path of U.S. Federal Reserve monetary policy. The dollar briefly pared some of its decline on the session after the S&P CoreLogic Case-Shiller composite index of 20 metropolitan areas showed U.S. single-family home prices rose in June from the prior year at the fastest pace on record.

 

Goldman Sachs says Greenback's Rally Likely Done

 

The Pound-to-Dollar exchange rate has built on Friday's post-Jackson Hole gains ahead of the new month, with Goldman Sachs confirming the pair could be on the way to a level above 1.41. Shifting Fed expectations have supported the Dollar over the last two month. But with tapering now largely priced in, and the currency stronger as a result, following through with the process should not drive the Dollar higher from this point forward. We therefore expect the greenback to stabilize over the coming weeks," says Zach Pandl at Goldman Sachs.

 

 

COMMODITIES

 

 

Oil settles down 1% as U.S. refineries shut; Washington pushes OPEC to pump more

 

Oil settled down 1% on Tuesday, posting its first monthly loss since March, as demand is expected to drop after Hurricane Ida shuttered U.S. Gulf refineries. Both benchmarks posted their first monthly losses since March, even though they are not far from July highs. Brent lost 4% in August while U.S. crude fell 7%.

 

Gold ends higher with U.S. consumer confidence at a 6-month low

 

Gold futures ended higher on Tuesday, with prices to tallying a slight gain for the month, as the metal found support following data showing a drop in U.S. consumer confidence to the lowest level in six months. Gold gained some ground on downbeat U.S. economic data, as the consumer confidence index and Chicago PMI weaken[ed] in August from July.

 

 

STOCKS

 

 

S&P 500 Slips, But Monthly Win Streak Continues

 

The S&P 500 fell Tuesday, as a slip in technology offset gains in real estate stocks, but the broader market still closed out August with a seventh-straight monthly gain.

Zoom Video Communications Inc slumped more than 16% after the video conference software company delivered quarterly results that beat on both the top and bottom lines, but signs of the pandemic-led boom in growth finally normalizing spooked investors.

 

 

CRYPTO

 

 

Bitcoin Up in August as 'Impressive Divergence' Points to Gains Ahead

 

Bitcoin is set to lock in double digit gains for August, but the latest findings show a meaningful pickup in activity on its blockchain hasn’t followed – and that could be a sign that strong gains are on the horizon. BTC's strong gains this month hasn't provided the expected shot in the arm for activity on Bitcoin’s network. This divergence has striking similarities to the mid-to-late 2020 rally, which saw the popular crypto increase four-fold.

 

 

ANALYSIS

 

 

Powell opens USD selling window but NFP and covid could close it – MUFG

 

“The NFP report on Friday is expected to show 750K new jobs recorded in August – enough to confirm a strengthening economy and provide support for yields and the dollar.”

“Powell’s speech has certainly opened up a window for USD weakness although it could close shut quite suddenly on either much stronger than expected jobs data this week or increased COVID-19 disruptions globally.”

 

 

CHART

 

 

Euro / British pound – Daily Candlesticks

Source: GKFX Prime Metatrader 4

EUR/GBP is pushing higher from a possible long term double bottom just under 0.85. The consolidation above the previous August 2 peak implies a possible break above 0.86. - Prepared by Trading Writers*

 

 

CALENDAR

 

 

*Times in GMT

Source: FX Street Economic Calendar

 

 

SOURCE

 

https://www.fxstreet.com/economic-calendar
https://www.fxstreet.com/news/powell-opens-usd-selling-window-but-nfp-and-covid-could-close-it-mufg-202108311138
https://www.poundsterlinglive.com/usd/15880-pound-to-dollar-outlook-goldman-sachs-says-greenback-s-rally-likely-done
https://www.investing.com/news/stock-market-news/sp-500-slips-but-monthly-win-streak-continues-2604574
https://www.investing.com/news/commodities-news/oil-falls-as-us-refiners-shut-down-by-damage-from-hurricane-ida-2603602
https://www.marketwatch.com/story/gold-edges-up-early-tuesday-as-dollar-retreats-11630413127
https://www.reuters.com/article/global-forex/forex-dollar-falls-to-more-than-3-week-low-with-payrolls-in-focus-idUSL1N2Q222A