GBPUSD Bearish Momentum Resumes, Silver Prices Break Key Level - US Market Open

MARKET DEVELOPMENT – GBP Selling Resumes, NZD Outperforms, Silver Breaks Key Level

NZD / AUD: Overnight, Chinese growth figures showed Q2 GDP at 6.2%, down from 6.4%, marking the weakest quarterly reading since 1992. Consequently, this raises scope for further stimulus measures from the Chinese government, which in turn has supported high beta currencies (AUD, NZD), most notably the New Zealand Dollar. On the technical front, NZDUSD broke above the 200DMA at 0.6714 to hit its highest level since mid-April. Going forward, focus will be on the NZ CPI scheduled later today.

GBP: The Pound trades with a soft undertone ahead of this week’s key economic releases, starting with the UK jobs report tomorrow. Uncertainties over Brexit persist and as long as they do, GBP gains are likely to be limited. This has also been evidenced by the weekly speculative COT data, which shows investors continuing to build their net short positions (highest since September 2018).

Silver: The precious metal is firmer by nearly 1% this morning with prices clearing key resistance at $15.33, which represents the 38.2% Fib level. As we had previously noted, the surge in institutional demand for silver as indicated by ETF purchases bodes well for silver. Eyes are on for a close above the 38.2% Fib to raise scope for a $15.50 test.

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