Johnson loses and Pound Victory, Bank of Canada and Gold
We continue to watch the confrontation between the British Parliament and Prime Minister Boris Johnson. Boris Johnson is losing another battle. On Tuesday, Boris Johnson not only lost his working majority, but he also could not initiate early elections.
As we predicted, the pound strengthened. Even the weak data on business activity in the UK could not prevent its strengthening: the PMI index of business activity in the services sector came out below forecasts (50.6 with a forecast of 51.0).
The dollar continued to suffer losses in the foreign exchange market. Even the euro strengthened against it. And this even though retail sales in the Eurozone came in the negative zone (-0.6%). However, despite yesterday's growth of the EURUSD, we are rather sceptical about buying euros.
Gold purchases look much more attractive and prospective under the current conditions. Another Fed rate cut in a couple of weeks (100% of traders believe in) could give an upward impulse to gold for its growth in the region of 1600. Recall that one of the key arguments against buying gold is its inability to generate guaranteed profit. But the Fed's rate-cutting cycles could lead to the dollar losing its ability to generate profit and becoming not interesting to investors.
The Bank of Canada announced that it left the policy rate steady. As a result, the Canadian dollar strengthened by a hundred points against the US dollar. Central Bank is not planning to cut rates in Canada saying that there are no reasons for that yat.
Today, as for macroeconomic statistics, it is interesting primarily for US employment data from ADP. Weak data could trigger dollar sales - traders will not wait for official statistics on Friday and will rush to discount under weak NFPs in advance.
Bears Continue To Drive The Dollar Lower so we recommend selling it since we expect a stronger wave of sales due to statistics on the US labour market.
Besides, today we will buy gold and the Japanese yen. Sales of the Russian ruble and oil are also what we are interested in.
As we predicted, the pound strengthened. Even the weak data on business activity in the UK could not prevent its strengthening: the PMI index of business activity in the services sector came out below forecasts (50.6 with a forecast of 51.0).
The dollar continued to suffer losses in the foreign exchange market. Even the euro strengthened against it. And this even though retail sales in the Eurozone came in the negative zone (-0.6%). However, despite yesterday's growth of the EURUSD, we are rather sceptical about buying euros.
Gold purchases look much more attractive and prospective under the current conditions. Another Fed rate cut in a couple of weeks (100% of traders believe in) could give an upward impulse to gold for its growth in the region of 1600. Recall that one of the key arguments against buying gold is its inability to generate guaranteed profit. But the Fed's rate-cutting cycles could lead to the dollar losing its ability to generate profit and becoming not interesting to investors.
The Bank of Canada announced that it left the policy rate steady. As a result, the Canadian dollar strengthened by a hundred points against the US dollar. Central Bank is not planning to cut rates in Canada saying that there are no reasons for that yat.
Today, as for macroeconomic statistics, it is interesting primarily for US employment data from ADP. Weak data could trigger dollar sales - traders will not wait for official statistics on Friday and will rush to discount under weak NFPs in advance.
Bears Continue To Drive The Dollar Lower so we recommend selling it since we expect a stronger wave of sales due to statistics on the US labour market.
Besides, today we will buy gold and the Japanese yen. Sales of the Russian ruble and oil are also what we are interested in.
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