The markets’ sell-off becomes broader
July 08, 2021 @ 17:47 +03:00
The Japanese yen is posting its sharpest intraday gain against the dollar this year, adding 0.9% today to 109.67.
Major European and US indices are losing more than 1% in early US trading, while increased demand for defensive bonds is helping the euro and franc to find support and gold to move further into the area above $1800, enjoying its seventh consecutive session of gains.
Unlike previous days, we now see the most typical risk-off, with simultaneous sell-offs of various risky assets and a pull to safety in many markets. Investors and traders in this situation should keep in mind that with a sustained one-way move, the euro and gold could reverse as sharply as they did in March 2020.
At the same time, it may be too early to bet on the start of a technical correction in the markets. The S&P500 is holding above the 50-day average line, which has acted as support since November. Perhaps only the intensification of the sell-off after the drop under 4220 from 4290 currently, for the S&P500, should be considered the end of this market phase.
The FxPro Analyst Team