- June 21, 2021
- Posted by: Analysis Team
- Category: FOREX, Technical Analysis
US equity futures rebounded on Monday as bond yields retreated as investors reacted to the recent Fed decision. Dow Jones futures rose by more than 200 points while S&P 500 futures rose by more than 0.40%. The 10-year and 30-year bond yields declined to 1.430% and 2.023%, respectively. While investors are afraid of high-interest rates, they are optimistic about the potential for fast economic recovery. Also, they are optimistic that politicians in Washington will reach a new infrastructure deal. The top movers today will likely be United Airlines, which said that it would cut flights to avoid potential strains as the airline sector rebounds. Bill Ackman’s Pershing Square Tontine Holdings will also be in focus after the company confirmed that it would acquire a 10% stake in Universal Music Group.
European equities were in the green today as investors waited for testimony by Christine Lagarde, the European Central Bank (ECB) president. The DAX index rose by 0.70% while the CAC 40 and Stoxx 50 rose by more than 0.20%. In the UK, the biggest mover was Morrison Supermarket after a US-based private equity firm expressed interest in the fourth-biggest retailer in the country. Companies exposed to the airline industry like Rolls-Royce and IAG struggled after it emerged that the Delta variant of coronavirus was spreading. France equities rose after Marine Le Pen’s party underperformed in the first round of the country’s regional election.
The US dollar retreated today as investors waited for a testimony by Fed’s Jerome Powell on Tuesday. The dollar index declined by 0.17% as the currency fell against most constituent currencies. Some analysts believe that the Fed chair will likely downplay the hawkish tone of last week’s meeting. Later this week, the currency will react to the latest US GDP, housing starts, and initial jobless claims data. It will also react to the latest interest rate decision by the Bank of England (BOE).
The BTCUSD declined sharply on Monday as the Chinese crackdown on miners continued. The pair also ignored the weak US dollar and bond yields. It fell to 32,315, which was the lowest level since June 9. On the four-hour chart, the pair moved below the 23.6% Fibonacci retracement level. It also moved below the 25-day and 50-day exponential moving averages (EMA). The Relative Strength Index (RSI) has also declined below the oversold level. Therefore, the pair will likely keep falling as bears target the next key support at 30,000.
The EURUSD pair attempted to recover today after it declined sharply last week. The pair rose to 1.1893, which was slightly above last week’s low of 1.1850. On the four-hour chart, the pair remained below the 61.8% Fibonacci retracement level. It is also below the 25-day and 15-day moving averages. Also, the price is below the Ichimoku cloud. Therefore, the pair will likely resume the downward trend in the short term.
The GBPUSD pair rose to an intraday high of 1.3882, which was the highest level since Thursday last week. On the four-hour chart, the pair rose to the 61.8% Fibonacci retracement level. The pair also managed to move below the short and long-term moving averages. The Relative Strength Index (RSI) has also moved above the oversold level of 30. Like the EURUSD, the pair will likely resume the downward trend.