EUR/USD & GBP/USD Lifted, Gold’s Bullish Breakout - US Market Open

MARKET DEVELOPMENT – EUR/USD & GBP/USD Lifted, Gold’s Bullish Breakout

EUR: Firmer start to the week for the Euro as it tests the 1.12 handle on the upside. Gains in the currency largely stemmed from the better than expected Markit PMI figures from Germany, which signalled that the economy is growing for the first time since August 2019. The composite figure moved into expansionary territory following a lift in the services sector to 52.9 from 52. On the technical front, topside resistance is situated at 1.1246 (50% Fib)

GBP: The Pound is among the outperformers in the G10 space as the services sector jumped out of the contractionary territory as initially projected in the final services PMI. IHS Markit noted that new orders rose at the fastest pace since July 2019, while business optimism reached its highest level since September 2018 with service providers becoming hopeful of a more stable political backdrop.

Gold: Rising tensions between the US and Iran continue to bode well for gold prices, which has extended its bullish breakout to hit a near 7-year peak. A war of words over the weekend with President Trump threatening further military action against Iran saw gold prices gap higher, hitting $1587, which marks the 61.8% Fibonacci retracement of a $1921-$1047 drop and with market participants awaiting Iran’s retaliation, escalation is likely to see gold hitting $1600.

Source: DailyFX, Refinitiv

Economic Calendar (06/01/20)

Source: DailyFX,

WHAT’S DRIVING MARKETS TODAY

1. “Euro Price Forecast - Strong US Dollar Hampers EUR/USD Upside” by Nick Cawley, Market Analyst
2. “Canadian Dollar Outlook – USD/CAD Broke Important Support” by Paul Robinson, Currency Strategist
3. “Crude Oil Prices Surge as President Trump Threatens Further Military Action on Iran” by Justin McQueen, Market Analyst

--- Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX