By Deepta Bolaky
 @DeeptaGOMarkets

Equity Markets

The performance in the US sharemarkets was mixed. The share price of big companies like Amazon and Facebook dropped and pulled major equity indices lower.

• S&P500 and Nasdaq Composite lost 0.2% and 0.6% respectively dragged by the technology sector.

• The Dow Jones Average Industrials added 0.1% at 27,221.35.

Currency Markets

In the forex markets, major currencies were mixed against the US dollar. On the economic front, the Dallas Fed Manufacturing Business Index came below expectations at -6.3. However, it is an improvement from -12.1 in June.

Attention was also on the British Pound, which crashed overnight on the prospect of a hard Brexit. Traders were hopeful of a last-minute agreement to avert a no-deal Brexit. However, expectations have receded with the new Prime Minister.

The Pound dropped to 28-month low against the dollar. It dipped by more than 1% to $1.2211 and €1.1004.

GBPUSD (Daily Chart)

Source: GO MT4

While the Pound is poised to further downside with Brexit uncertainties, the upcoming events and most importantly the Fed highly expected rate cut could cushion the fall for GBPUSD and could help the pair to rebound.

The Aussie Dollar closed in the red against the greenback for the seventh consecutive days. However, it held above the 69.00US cents

Commodities

With trade talks back on the table, oil prices started the week on a positive note with modest gains. WTI and Brent Crude are currently trading in the vicinity of $57 and $6 respectively.

We expect the short-term price action to be driven by the developments of trade negotiations and oil reports. Traders should also keep an eye on the tensions in the Persian Gulf.

UKOUSD and USOUSD (Daily Chart)

Source: GO MT4

On the daily chart, we can see that the yellow metal is moving in a tight range. We expect the next event for Gold will be the Fed’s interest rate decision tomorrow. A highly dovish stance from the Fed and comments of more rate cuts could push the XAUUSD pair firmly to the upside.

A rate cut is more or less priced-in, and the reaction in the yellow metal will, therefore, depend on the language of the Fed on the easing policies.

XAUUSD (Daily Chart)

Source: GO MT4

Cryptocurrencies

Major cryptocurrencies were slightly higher on Monday. The crypto-market is facing more scrutiny by world governments, which are dampening sentiment. However, the renewed interest is helping digital assets to bounce back from last year lows and trade around relatively high levels despite the volatility.

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