The European stocks are likely to open higher after the new peaks in US indices and the returned optimism on the markets.
The FED meeting minutes yesterday added to investors' expectations for a more moderate rate of increase in interest rates and this is positive for the stock market. Today, sentiment will be very positive, which will probably lead to new increases in European indices and stocks.
Expectations for the OPEC meeting continue to support the oil prices, which raises risk appetite. This in turn is highly positive for the stock market and the risk on currencies: AUD, NZD and CAD.
Under the spotlight on the FX market will be GBP 11:30, when UK GDP data will be announced.Right now the uncertainty before the parliamentary elections in UK does not allow the pound to make a new peak, and data below expectations today may be a catalyst for a short-term downward momentum.
The dollar index remains in an oversold zone and close to the previous bottom, making the US currency quite attractive for purchases. The increased demand for US stocks may support the US dollar as well. We remain cautious about buying the USD after appropriate signals.
The euro remains strongly supported by speculation about the June ECB meeting and the likely change in the direction of monetary policy on the old continent. This will continue to be traded, and we can look for new long positions on EUR for every better adjustment with appropriate price action signals.
As long the positivism is on the markets we can await new decreases in the Japanese yen.
Trader Nikolay Georgiev
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