S&P 500, US Dollar, Gold, FOMC Minutes, New Zealand Dollar, RBNZ

Global market sentiment deteriorated further in the past week. On Wall Street, futures tracking the S&P 500, Nasdaq 100 and Dow Jones weakened by 2.97%, 4.49% and 2.81%, respectively. For the S&P 500, this meant a 7e consecutive weekly losing streak. That was the worst consistent performance since 2001.

Risk aversion did not signify another strong week for the port-pegged US dollar, which has weakened the most since late January. As a result, some of its key competitors outperformed. These include the Euro and the British Pound. The GBP/USD even rose more than 1.9% in the strongest weekly return since late 2020. The Australian and New Zealand dollars also outperformed.

It seems there were Growing Concerns About a US Recession on the road as markets priced in a Federal Reserve tightening in 2023. Treasury yields continued to flatten, with the 10-year performance showing the worst two-week performance since November. The weakness of the US dollar and government bond yields pushed gold prices up 1.9%.

The economy will pick up remarkably in the coming week. FOMC minutes will be closely watched, which could confirm the Federal Reserve’s aggressive stance. The central bank will also be looking at its favorite inflation gauge, PCE core. As such, these events could continue to threaten overall risk appetite.

The New Zealand dollar awaits the RBNZ’s rate decision. A 50 basis point rate hike is expected to 2.00% from 1.50% earlier, with more in July. A federal election in Australia is likely to have little impact on the Australian dollar, given the policies dictated by the two major parties. What else can the markets expect in the coming week?

US DOLLAR PERFORMANCE VS. CURRENCIES AND GOLD

Fundamental forecasts:

USDCAD Outlook Choppy, But Loonie Exceeds Face Reversal Risk

The Canadian dollar is supported by one of the central bank’s most aggressive interest rate forecasts among the majors, while growth forecasts hold up quite well. Despite this, the currency has performed well overall. Could this over-optimism set the Loonie on a roll?

Australian Dollar Outlook: It’s all about the big dollar

The Australian dollar has a healthy economic record, but as the Fed races against the clock, the US dollar is soaring. Will AUD/USD Continue to Bounce on Recent Lows?

Pound Sterling Forecast: GBP/USD Rises on Positive UK Data, US Dollar Weakness

GBP/USD is up more than 2 big digits this week as Sterling continues to fight back from its recent two-year low.

Bitcoin Outlook: Stocks and Cryptos Struggling to Recover, FOMC looms

Bitcoin, Ether and altcoins remain range-bound as fundamental and technical factors drive price action. Risk sentiment limits gains as the FOMC meeting approaches.

Outlook for US Dollar: Recession Troubles Take Their Toll, But USD May Get the Upper Either Way

The US dollar lost ground last week as markets became more concerned about a recession. FOMC minutes and the Fed’s preferred inflation index could offer the USD some life.

Technical predictions:

S&P 500 a whisker away from Technical Bear Market, Nasdaq Lower

The S&P 500 flirts with the 20% drop from its January high, while the weekly Nasdaq chart looks oversold, signaling a slowdown in the sell-off next week

Crude oil forecast downgraded to volatile range to 115 or 100 interruptions

US crude isn’t just bidding its time amid more active conditions in the broader financial system. The commodity continues to show significant realized volatility and has played swings of 10 to 15 percent in one to two week clips. Still, a decisive trend continues to hint.

US Dollar Technical Forecast: DXY Snaps Six-Week Series – USD Levels

The US dollar rallied for six weeks to resistance and threatens a deeper pullback within the broader uptrend. The technical levels that matter on the DXY weekly chart.

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