This is what you need to know to trade today Thursday July 22:
Market mood remains lively, allowing the dollar to pull back, while higher returns weigh on gold. The euro is lagging as tensions mount towards the potentially dovish ECB decision. Bitcoin gets a boost from its followers and the markets keep the focus on the covid headlines.
Risk appetite: US stock markets advanced for the second day in a row, reversing Monday’s selloff. Investors are cheering company earnings and shrugging off COVID concerns as companies, including those in sectors related to the reopening, post upbeat forecasts. Coronavirus cases in the United States have nearly tripled from the June low.
The US Treasuries are sold, pushing 10-year bond yields toward 1.30%. The greenback is losing ground only against the yen and declining against other currencies. Gold is a notable loser, struggling to hold on to $ 1,800 as higher yields on US debt make the precious metal less attractive.
Pessimistic inclination ?: The European Central Bank will announce its first decision following the announcement of a strategic review. That change includes allowing inflation to hover around 2% rather than limiting price increases below that ceiling. ECB President Christine Lagarde promised changes in communication and possible developments related to the bank’s bond purchase plan.
Expectations have limited EUR / USD below 1.18. Covid cases continue to increase in the old continent
Brexi; David Frost, the UK’s chief negotiator, said Britain wants to renegotiate the Northern Ireland protocol as it is causing problems. Brussels rejected any attempt to change the terms of the agreement. GBP / USD appears to have shrugged off both Brexit and UK covid cases – which are above 40,000 a day – and is recovering to 1.37.
Coronavirus in Asia: The death toll in India is estimated at about four million, according to the excess death analysis, well above the official figures. The Delta variant continues to spread in Asia, including at the Olympic Village in Tokyo before the opening ceremony of the Olympic Games.
Gasto en EE.UU .: Democratic and Republican lawmakers continue to negotiate their infrastructure bill, which appears to be in its final stretch. Weekly unemployment claims are also of interest.
Bitcoin has recovered $ 32,000 and Ethereum is approaching $ 2,000 after Tesla founder Elon Musk hinted that his company might once again accept BTC as payment for its vehicles. Cathie Wood of ARK Investment added that the digital currency is a hedge against inflation. On the other hand, Scott Minerd of Googenheim predicted a reduction by half, towards $ 15,000, due to competition with other currencies among other factors.