• Prior +7.2%
• CPI -0.1% vs +0.2% m/m expected
• Prior +0.4%
• HICP +6.3% vs +6.8% y/y expected
• Prior +7.6%
• HICP -0.2% vs +0.2% m/m expected
• Prior +0.6%

This article was written by Justin Low at www.forexlive.com.

• We have the votes to pass the debt limit bill today – McHenry
• Fed’s Mester: No compelling reason to wait on rate hikes
• ECB’s de Guindos: Inflation data today and yesterday has been positive
• ECB’s Villeroy: It is quite likely that inflation has passed its peak in France
• Traders pare ECB rate hike bets after French inflation data
• France May preliminary CPI +5.1% vs +5.5% y/y expected
• Saxony May CPI +6.5% vs +7.6% y/y prior
• Bavaria May CPI +6.1% vs +7.2% y/y prior
• North Rhine Westphalia May CPI +5.7% vs +6.8% y/y prior
• Italy May preliminary CPI +7.6% vs +7.4% y/y expected
• Germany April import price index -1.7% vs -0.5% m/m expected
• Germany May unemployment change 9k vs 15k expected
• France Q1 final GDP +0.2% vs +0.2% q/q prelim
• Italy Q1 final GDP +0.6% vs +0.5% q/q prelim
• US MBA mortgage applications w.e. 26 May -3.7% vs -4.6% prior

Markets:

• USD and JPY lead, AUD lags on the day
• European equities lower; S&P 500 futures down 0.4%
• US 10-year yields down 5 bps to 3.646%
• Gold flat at $1,959.58
• WTI crude down 2.6% to $67.67
• Bitcoin down 2.4% to $27,121

It was an eventful session as there were a couple of broad market themes playing out in European trading today.

For one, the dollar resumed its bid from last week as it advanced across the board despite falling yields once again (it was the opposite yesterday). Poor China data from Asia trading earlier sort of set the tone for a more risk-off mood in Europe and that was certainly the case with the greenback gaining ground alongside the yen.

Equities fell as such and even with lower inflation figures in France, Italy, and German states, it wasn’t enough to turn the tide.

Instead, it was a typical flight to safety with commodity currencies and oil being offered. Despite a stronger dollar, gold held its ground as it seems like haven bids are helping out.

Going back to FX, EUR/USD declined from 1.0710 to 1.0660 before holding around 1.0680 now. Meanwhile, GBP/USD also fell from 1.2390 to 1.2350 with USD/CHF even moving up by 0.5% to clip the 0.9100 level on the day.

But it was against the commodity currencies where the dollar did most of its work, with AUD/USD down 0.6% to 0.6475 and NZD/USD down 0.6% as well to test the 0.6000 mark. Both pairs are down to their lowest levels for the year, threatening a further downside break.

WTI crude is keeping down by nearly 3% on the day as China’s worries weigh on demand prospects, testing waters below $68.

Month-end trading is also in focus, so just keep an eye out ahead of the London fix later in case we do get another injection of volatility.

This article was written by Justin Low at www.forexlive.com.

On the
daily chart below, we can see that USDCHF has recently broke out of the major
downward trendline and has
now extended towards the 0.91 handle. The moving averages have
crossed to the upside confirming the change in trend. The rally has come amid
strong US economic data in May that have made the market to reprice interest
rates expectations on the hawkish side. In fact, the market is now giving a 65% probability for a 25
bps hike at the June meeting. This can all change with the next NFP and CPI
reports of course, so traders will be very attentive to those two releases.

USDCHF Technical Analysis

On the 4
hour chart below, we can see that USDCHF has recently bounced again on the
upward trendline, as that has been a strong support since the price bottomed in
early May, and kept offering buyers good entry points. We can notice that now
the price is diverging with the
MACD right
when it approaches the resistance at 0.91.
This is generally a sign of weakening momentum often followed by pullbacks or
reversals. In this case, we may get a pullback either to the broken resistance turned support at
0.9070 or even better the upward trendline.

On the 1
hour chart below, we can see that we have a strong support zone at the 0.9070
level. In case USDCHF pulls back, the buyers will be leaning on that level with
a defined risk just below it and target the breakout of the 0.91 handle for new
highs afterwards. The sellers, on the other hand, should defend the 0.91 handle
here targeting new lower lows and thus offer the pullback to the support zone.

As
mentioned above, the trend is bullish, so the sellers will have much more work
to do before getting back the control. In fact, only a break below the upward
trendline would switch the bias to the downside and see the sellers piling in
more aggressively.

This article was written by ForexLive at www.forexlive.com.

• Prior -4.6%
• Market index 197.4 vs 205.0 prior
• Purchase index 154.4 vs 158.3 prior
• Refinance index 412.5 vs 443.0 prior
• 30-year mortgage rate 6.91% vs 6.69% prior

Once again, mortgage activity declined as there is a significant jump in the interest rate of the most popular US home loan. The 30-year rate increased to 6.91% in the past week, marking its highest level since the first week of November last year. That led to a further decline in both purchase and refinancing activity. Pain.

This article was written by Justin Low at www.forexlive.com.

It’s all just semantics at this point as the debt ceiling issue is now kicked down the road once again, as it has always been over the past many decades. As mentioned earlier in the week, this isn’t going to be a concern for markets anymore as the focus switches back to central banks, inflation, and the economy.

This article was written by Justin Low at www.forexlive.com.

On the daily chart below, we can
see that the ADUUSD pair has finally broken out of the 3-month long range it’s
been stuck in since the Silicon Valley Bank collapse. The big USD strength came
from stronger than expected US economic data that made the market to reprice
interest rates expectations on the hawkish side.

There’s a feeling that the Fed
may need to get to 6% FFR before really pausing as the data has shown data that
the economy is not weak enough to bring inflation back to the 2% target. The
price has recently pulled back to the broken support
turned resistance in what looks like a retest before a continuation
to the downside.

AUDUSD Technical Analysis

On the 4 hour chart below, we can
see that AUDUSD pulled back last week into the 0.6563 resistance where we also find the confluence from the trendline and the 38.2% Fibonacci
retracement level. This will be a key resistance zone and the
buyers will need the price to break above it before getting the conviction for
a rally towards the 0.66 handle or beyond. The sellers, on the other hand, will
lean on this resistance with a defined risk above it to target a break below
the recent low and then the 0.63 handle.

On the 1 hour chart below, we can
see that right now we have this consolidation beneath the 0.6563 resistance. As
previously mentioned, the buyers will need a break above the strong resistance
zone and the trendline to target new higher highs as at the moment the
technicals and the fundamentals are skewed heavily to the downside.

If the sellers missed the short
from the resistance, we may see more of them coming in once the price breaks
below the 0.65 swing low. The main event of this week is the US NFP report and the market may even
trade into it given the strong labour market data we got up to now.
Nevertheless, higher than expected figures should support the USD, while lower
than expected readings should weaken the greenback.

This article was written by ForexLive at www.forexlive.com.

Well, the situation is still highly fluid but it is possible to see two more rate hikes before pausing by the ECB. Markets are seeing a peak in rates at about 3.68% now, which is somewhat consistent of two additional rate hikes at least.

This article was written by Justin Low at www.forexlive.com.

Vertex Labs (https://vertexlabs.uk/), the brain behind the Caduceus metaverse protocol, Vertex Network and 3D metaverse platform, LightCycle, has acquired London-based digital art studio, Digimental Studio (Digimental), the driving force behind blue-chip 3D NFT fashion brand, HAPE for US$12 million. The acquisition completes Vertexlabs.uk offering as the world’s leading provider of Web3 and AI infrastructure and marks a pivotal milestone for the global metaverse industry.

Through its acquisition of Digimental, Vertexlabs.uk will introduce a staking programme for its HAPE community members. Building on HAPE’s collaborations with Italian fashion giant, Diesel and iconic global lifestyle brand, Jagermeister, HAPE will continue to form new partnerships with fashion, lifestyle and luxury players, providing them with unprecedented access and infrastructure support within the Web3 space. The shared vision is for HAPE to become the go-to destination within the fashionverse and a home for its community members, through its integration into Vertexlabs.uk’s 3D metaverse platform, LightCycle. Digimental will lead on the creation and development of LightCycle.

Founded in 2011, Digimental Studio launched its prolific brainchild, HAPE, in 2021; with a current trading volume $US200 million, HAPE boasts the largest NFT community in the world with over 420,000 members on Discord and a global, cross-platform community of over 1 million members. HAPE rapidly achieved cult status and an insatiable collector-based following for its iconic digital art, rooted in cultural cues from street fashion, tech and music.

Its release of 8,192 minted HAPES (unique Ethereum-based NFTs), broke NFT-release records when it drew in 450,000+ global community members to its HAPE Discord channel, with resale purchases exceeding US$20,000 per HAPE on OpenSea. S

olidifying its foothold within the fashionverse, HAPE went on to partner with Italian fashion giant, Diesel, earlier this year to launch a co-created, limited edition NFT collection, offering exclusive physical and digital rewards; the collaboration forms part of HAPE’s wider commitment to innovate together with brands, bridging the gap between Web2 and Web3.

The merge builds on Vertexlabs.uk’s strategic partnership with HAPE, formed to supercharge HAPE’s ecosystem by providing a vital infrastructure layer for Web3 projects and through the integration of tokenomics. Vertexlabs.uk’s metaverse, Web3 and AI infrastructure is powered by decentralised edge rendering and offers an unparalleled solution. Its Caduceus metaverse protocol is modular and easy to adopt, with up to 100,000 fast transactions per second, extremely low gas costs and compatibility with EVM. This means developers can use its decentralised real-time edge rendering and AI computing for migration, immersion and streaming.

The merge also saw the successful integration of $CMP token into HAPE’s native ecosystem, enabling holders to purchase on-chain digital clothing within the HAPE marketplace, using CMP, to create a seamless metaverse experience.

Ander Tsui, Founder & CEO of Vertexlabs.uk said: “Web3 is nothing without content. We have developed the world’s first blockchain dedicated to metaverse development and now, by adding Digimental to our stable – together we can truly push the boundaries of the digital world, providing the infrastructure for the future of fashion and entertainment.

HAPE’s community is paramount in our growth strategy and we’re excited that, through tokenisation and our soon-to-launch staking programme, HAPE and CMP token holders will reap the rewards.”Matt Sypien, Founder, Digimental Studio added: “Joining forces with Vertex Labs opens up an exciting new chapter for Digimental Studio. As we enter the Hape 2.0 era, our collaboration will push the frontiers of the digital world. Cultivating a loyal and engaged community has always been at the heart of HAPE’s success. With Vertex Labs’ support, we will take this to the next level and offer our community unparalleled access and experiences in Web3. We are excited to forge new partnerships with bands leading the zeitgeist in fashion, music and culture and we are committed to continuing to innovate together.”

About Vertex Labs

Vertex Labs is a Metaverse, Web3 and AI infrastructure provider, powered by decentralised, real-time edge rendering engine. Its cutting-edge technology includes: A metaverse graph consensus mechanism enabling large-scale parallel processing that outmatches traditional Layer 1 protocols; a real-time edge rendering engine with flexible distributed real-time rendering technology delivering improved efficiency and lower costs for all users; interactive metaverse technology with extensive device and devkit support, enabling seamless creation and experience of immersive 3D models and environments.

About Digimental Studio

Founded and Directed by Matt Sypien, Digimental Studio offers design-led Web3 services and has numerous industry awards. As the first NFT collection by Digimental Studio, Hape launched in January 2022 to tremendous success, crashing OpenSea twice due to high demand. It continues to lead innovation in the Web3 space, operating at the intersection of fashion, lifestyle and culture.

Matt Sypien Bio: Digimental (Matt Sypien) is the Director of Digimental Studio and Founder of Hape. Hailing from Krakow, Poland and now London-based, Digi evolved his passion for all things creative from a hobby into a career. His creativity spans a variety of media and techniques such as digital imaging, print and packaging, film and television production. His diverse client list includes Chelsea FC, Nike, Christies, Four Seasons, Google, Audi, Skrillex, The Economist, among many others. Digi’s distinctive artworks have earned him numerous industry awards and global recognition.

This article was written by ForexLive at www.forexlive.com.

On the daily chart below, we can
see that USDCAD has been pretty much rangebound for half a year, probably
because the two most hawkish central banks, the Fed and the BoC, were seen
coming to the end of their tightening cycle. We have two major levels here, the
support at 1.3300 and the resistance at
1.3665. The USD has recently started to appreciate across the board due to
stronger than expected US economic data that made the market to reprice
interest rates expectations on the hawkish side.

This development has lifted the
USDCAD and took it back to 1.3665 level from the 1.3300 support. The buyers
will now eye a break above the 13665 resistance to start targeting the previous
high at 1.3862, while the sellers will want to defend this level and target
another fall to the 1.3300 handle.

USDCAD Technical Analysis

On the 4 hour chart below, we can
see that within the 1.3300 and 1.3665 range we have another two significant
levels. The price is now near one of them at 1.3553 and it’s expected to be a
strong support. We can find here the confluence from the trendline and the 61.8% Fibonacci
retracement level.

The buyers will be leaning on
this support zone with a defined risk below it in case the price spikes down to
it. The target will be the 1.3665 high first and, upon a breakout, the 1.3862
resistance. The sellers, on the other hand, will be waiting for a break below
the 1.3553 zone to pile in and target the 1.34 handle.

On the 1
hour chart below, we can see that USDCAD is already showing signs of bottoming.
So, in case the price does not spike down to the support zone, the buyers may
start to pile in once the price breaks above the recent swing high at 1.3612.
The target would be the breakout of the 1.3665 high.

The
sellers don’t have much to lean on here as the only strategies would be to lean
on the 1.3665 resistance with a defined risk above it or wait for the downside
breakout of the 1.3553 support zone. This week the main risk event is the US NFP report on Friday where strong
readings should keep the USD bid, while misses should cause USD weakness.

This article was written by ForexLive at www.forexlive.com.

• Spain prime minister Sánchez calls for snap election in July
• Europe looks to inflation data again later this week
• Dollar mildly lower as we get into holiday-thin trading in Europe
• Heads up: US non-farm payrolls to be released later this week

Markets:

• AUD leads, EUR lags on the day
• European equities slightly lower; S&P 500 futures up 0.2%
• Gold down 0.1% to $1,945.17
• WTI crude down 0.2% to $72.51
• Bitcoin up 4.2% to $27,885

It was a quiet session in Europe as it is a bank holiday and UK markets are also out for the day. Add that to the long weekend in the US and it made for a rather subdued session with little focus and appetite in general.

Major currencies held in tight ranges as the dollar trades mildly lower at the balance. However, the technicals continue to favour the greenback with USD/JPY holding above 140.00 despite being down 0.3% to 140.20 levels at the moment.

EUR/USD and GBP/USD are both little changed and flattish around 1.0720 and 1.2345 respectively. Meanwhile, commodity currencies are just lightly higher as US futures are also holding light gains after weekend news that the US debt ceiling deal has been done.

As US markets are also closed, we’ll have to wait on tomorrow to officially kick start the trading week but keep in mind that month-end trading will make things a bit tricky before we get to inflation data in Europe and US non-farm payrolls on Friday.

This article was written by Justin Low at www.forexlive.com.