Weekly Market Analysis: July 12 - 16, 2021 - The Delta Variant is Rampant

The weekly market analysis for July 12-16, 2021, will discuss several factors that will influence market movements over the next week. The US Dollar is still moving in a stable condition, although in trading on Friday at the end of last week it was in a weakening position. The weakening of the US Dollar was due to pressure from poor economic data releases. The data is Final Wholesales Inventories which are lower than predicted and the previous period. However, the current condition of the Greenback still tends to be at a strengthening level against several other major currencies. The condition of the US Dollar is still stable against several other major currencies because market players still believe that the US economy will soon return to normal levels. However, we also need to be aware of the spread of the Corona virus with its new variant. The Corona virus pandemic with a new type known as the Delta variant has been rampant and hit countries in the world. This has caused market players to hunt for safe haven assets such as Gold, the US Dollar, and the Japanese Yen. EURUSD had moved to strengthen for the Euro currency compared to the US Dollar, this strengthening of the Euro occurred due to the weakening of the US Dollar currency. This limited weakening of the US Dollar occurred due to the pressure of the pessimistic attitude of several market players regarding the US economic conditions. For today's market movement, EURUSD is expected to try to continue its strengthening compared to the US Dollar. GBPUSD moved to strengthen for the Pound Sterling currency compared to the US Dollar currency. This strengthening of the Pound Sterling occurred because it received support from the optimistic attitude shown by market players regarding the condition of the British economy. Currently, England is one of the countries that is predicted to soon follow the United States in terms of economic recovery in the midst of the Covid-19 pandemic that hit. Today's market movement is predicted that the Pound Sterling will try to continue its strengthening against the US Dollar. USDJPY moved to strengthen for the Japanese Yen currency compared to the US dollar. The strengthening of the Yen was due to the encouragement of the weakening US Dollar. In addition to getting encouragement from the weakening US Dollar, the Yen also received support from the attitude of market players who turned to safe haven assets to avoid volatile market conditions. This market turmoil occurred due to concerns about the Delta variant spreading in the world. This variant first appeared in India in the middle of last year. For today's market movement, USDJPY is predicted to continue to strengthen compared to the US Dollar. AUDUSD experienced quite a strengthening in the market trading on Friday last weekend. This strengthening occurred for the Australian Dollar currency compared to the US Dollar. In addition to the weak US Dollar, the strengthening of the Aussie was also supported by the rising prices of Australia's leading commodities. The commodity results in question are the rising prices for metal commodities and also the rising prices of copper commodities. Today's market movement is predicted that the Aussie will weaken against the US Dollar. Oil moved up in the market trading on Friday last weekend, the increase in the price of Oil was due to the weakening of the US Dollar. For today's market movement, it is predicted that the price of Oil will try to continue to increase and is expected to reach its highest daily record. GOLD in trading on Friday last weekend rose and reached its highest daily level. The increase in the price of Gold was supported by the weak release of American economic data. The data is the US Final Wholesales Inventories report which was released lower than predicted and the previous period. In addition to the poor US economic data, the increase in Gold prices also received support from the threat of the spread of the Delta variant of the Corona virus which is increasingly attacking several countries in the world. For today's market movement, it is predicted that the price of Gold will try to decline. The decline in the price of Gold was due to profit taking by market players after its increase at the end of last week.

1. Important Data/High Impact Weekly Market Analysis 12 - 16 July 2021

1.1 CPI & Core CPI (USD)

Tuesday, 19:30 WIB. CPI This data calculates changes in the prices of goods and services at the consumer level. The average price of various goods and services is sampled and then compared with the sampling in the previous period. Consumer prices are the majority of the overall data for calculating a country's inflation rate. Inflation is very important for assessing whether a country's currency is weakening or strengthening, because if prices rise, the central bank will raise interest rates in order to control the inflation rate. If this data is released, it will have a major impact on market movements. Core CPI is the core data from consumer price data which is the majority of overall inflation. Inflation is important for currency assessment because rising prices cause central banks to raise interest rates to honor their mandate to control inflation. Food and energy prices account for about a quarter of the CPI, but tend to be very volatile and distort the underlying trend.

1.2 RBNZ Rate Statement & Official Cash Rate (NZD)

Wednesday, 09:00 WIB. RBNZ Rate Statement is a data release related to interest rates. This data is one of the main tools used by the RBNZ to provide information to market participants about New Zealand's monetary policy. This data contains the results of the central bank's decision on interest rates and comments on the economic conditions that influence their decisions. Most importantly, it discusses the economic outlook and offers clues about what policies will be taken for the future. The Official Cash Rate is the reference level of interest rates where the central bank provides loans in the form of soft loans to other banks. The decision of the head of the central bank on interest rates is usually awaited by investors, so it tends to move the market actively. Meanwhile, the short-term interest rate is the most important factor in assessing a country's currency. Market participants look at most other indicators only to predict how interest rates will change in the future.

1.3 PPI & Core PPI (USD)

Wednesday, 19:30 WIB. PPI (Producer Price Index) is data that measures changes in the price of finished goods and services sold by producers. This data is a leading indicator for measuring the level of consumer inflation, where when producers charge more for the goods and services they produce, the higher costs are usually passed on to consumers. PPI consists of Finished Goods PPI, Wholesale Prices, PPI for Final Demand. Core PPI is the core data from producer price data that constitutes the majority of overall inflation. Inflation is important for currency valuation because rising prices cause central banks to raise interest rates to honor their inflation control mandate. Food and energy prices account for about a quarter of the CPI, but tend to be highly volatile and distort the underlying trend.

1.4 BOC Monetary Policy Report & BOC Rate Statement (CAD)

Wednesday, 21:00 WIB. BOC Monetary Policy Report This provides valuable insight into the bank's view of economic conditions and inflation. This data is a key factor that will help the central bank to make monetary policy and influence decisions on interest rates, whether to keep them steady, raise or lower them. BOC Rate Statement, this data is the main tool used by the central bank's Board of Commissioners to provide investors with information about monetary policy. This data also contains the results of their decisions on interest rates and comments on economic conditions that influenced their decisions. Most importantly, it discusses the economic outlook and offers clues about the results of decisions that are useful for making decisions for future policy.

1.5 BOC Press Conference (CAD)

Wednesday, 10:00 p.m. WIB. This data on the press conference has 2 parts - first a prepared statement is read, then the conference is open to questions from the press. The questions often lead to unscripted answers that create great market volatility. This is one of the main methods the Board uses to provide investors with information about monetary policy. It covers in detail the factors that influenced the latest interest rate decision, such as the overall economic outlook and inflation. Most importantly, it provides clues about what monetary policy will be in the future.

1.6 Fed Chair Powell Testifies (USD)

Wednesday, 23:00 WIB. As the head of the central bank Jerome Powell, who controls short-term interest rates, he has a greater influence on the value of the US currency. Market players are watching the policy that will be taken, because it is often used to provide global clues about future monetary policy. The central bank chairman's accountability speech usually comes in 2 parts: first he will read a prepared statement (text version), then the committee will hold a question and answer session. Because the questions are not known in advance, this moment can cause very volatile movements in the market.

1.7 Employment Change & Unemployment Rate (AUD)

Thursday, 08:30 WIB. Employment Change is important because job creation is an important leading indicator of consumer spending, which accounts for the majority of overall economic activity. This data is the most important economic data released shortly after the end of the month. The combination of importance and clarity produces a large and powerful market impact. The Unemployment Rate is the percentage (%) of the total working age population who are unemployed and actively looking for work during the previous month. Although generally viewed as a less solid indicator, the number of unemployed is an important signal of overall economic health because consumer spending is highly correlated with labor market conditions.

1.8 GDP (CNY)

Thursday, 09:00 WIB. This data is data that measures the level of income and purchasing power of a country, and data that records the annual rate of change in the inflation-adjusted value of all goods and services produced by the country.

1.9 CPI (NZD)

Friday, 05:45 WIB. This data calculates changes in the prices of goods and services at the consumer level. The average prices of various goods and services are sampled and then compared with the sampling in the previous period. Consumer prices are the majority of the overall data for calculating a country's inflation rate. Inflation is very important for assessing whether a country's currency is weakening or strengthening, because if prices rise, the central bank will raise interest rates in order to control inflation. If this data is released, it will have a major impact on market movements.

1.10 BOJ Outlook Report, BOJ Monetary Policy Statement & BOJ Press Conference (JPY)

Friday, Tentative. The BOJ Outlook Report is a piece of data that will provide valuable insight into the central bank’s view of the economy and inflation, as well as important factors that will shape its future monetary policy decisions. The BOJ Monetary Policy Statement is a piece of data that is one of the main tools the BOJ uses to communicate to investors about monetary policy. It contains the results of their decisions on asset purchases and comments on the economic conditions that influenced their decisions. Most importantly, it projects the economic outlook and offers clues about future voting outcomes. The BOJ Press Conference is a session where the chairman of the Bank of Japan will give his explanation in front of the public through the media. Market movements will be volatile during the Q&A session where he will explain spontaneously about the economy or anything related to the Japanese currency and interest rates.

1.11 Core Retail Sales & Retail Sales (USD)

Friday, 19:30 WIB. The definition of Core Retail Sales is: data that records changes in the total value of sales at the retail level, excluding cars. Although car sales account for about 20% of Retail Sales, they tend to be very volatile and distort the underlying trend. Therefore, core data is considered a better measure of spending trends. While Retail Sales data is: data that records changes in the total value of all sales at the retail level. This is the overall baseline data for important consumer spending data. This data is also an important benchmark for consumer spending levels, which account for a large portion of a country's overall economic activity.

2. Technical Review According to Weekly Market Analysis 12 - 16 July 2021

2.1 EUR/USD

2.2 USDCHF

2.3 GBPUSD

2.4 USDJPY

2.5 Gold

2.6 AUDUSD

2.7 Oil

Preferensi	BULLISH
Movement Range	77,45 (High)
Movement Range	70,47 (Low)

This is the weekly market analysis for July 12-16, 2021, which discusses the rampant Delta variant of the Covid-19 virus in the world and its impact on market movements. Always prioritize Money Management and Risk Management in your trading. Visit GIC Indonesia to get information about the world of trading. You can also join us in the GIC Trade Telegram Community and GIC Trade Telegram Channel. Don't forget to check the GIC Indonesia Youtube account which is full of lots of information, and follow our Instagram account to get information about various interesting webinars that you can follow.