The US dollar index keeps rounding above the 103.60 historical support level. The buyers have already defended this level for three weeks, highlighting their interest in the greenback. Thus, buying USD looks less risky right now.
Gold reversed from dips ahead Biden's speech
- The US dollar keeps climbing up, heading for its best quarter in 12 months.
- 10-year Treasury yields reached a 14-month high of 1.77%.
- Gold dropped to the lows unseen since June of the last year.
- Bitcoin pauses yesterday’s growth. Now it is trading under $59,000.
- US President Joe Biden is expected to unveil a huge infrastructure package today, which will add fresh volatility to markets.
- China’s manufacturing industry rose more than expected, showing that economic activity recovers and demand strengthens.
EUR/USD has broken through the lower trend line at 1.1750 but has failed to cross the psychological mark of 1.1700 so far. If it manages to do so, the way down to November’s low of 1.1630 will be open. On the flip side, if the sentiment changes and the euro gets a stimulus to rise, it may return to the resistance of 1.1750. If it crosses it, the doors to the high of March 26 at 1.1800 will be open.
GBP/USD has been falling inside the descending channel. If it manages to break the 50-period moving average of 1.3780, the way up to the 100-period MA of 1.3840 will be open. On the flip side, the move below the intraday low of 1.3720 will press the pound to the low of March 25 at 1.3680.
USD/JPY was rallying up for six days in a row. Today it has bounced off the resistance of 111.00 as the RSI indicator went above 70.00, indicating the pair is overbought. If it finally manages to break through 111.00, the way up to the next round number of 111.50 will be open. In the opposite scenario, if bears keep momentum and the pair drops below 110.30, it may fall to the key psychological mark of 110.00.
Finally, let’s discuss gold. After the sharp drop, it has reversed from the support of $1680. If it manages to break above yesterday’s high of $1715, the way up to the high of March 26 will be open. On the flip side, if it drops below $1680, it will fall to the 100-weekly moving average of $1660 (switch to the weekly chart to see it).
On the H4 timeframe, the US dollar index has formed a bullish falling wedge. At the beginning of the trading session, the price is testing the upper border of this wedge. Thus, in case of a higher-than-expected Core PCE Price Index m/m, the US dollar will skyrocket against other currencies.
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S&P Global, a private banking company, will release a monthly change in British Flash Manufacturing Purchasing Managers Index (PMI) on January 24, 11:30 GMT+2. The index is a leading indicator of economic health as businesses react quickly to market conditions, and purchasing managers hold the most current and relevant insight into the company's view of the economy.
The United States Bureau of Labor Statistics will publish the US Consumer Price Index (CPI) m/m on January 12 at 15:30 GMT+2. The index measures a change in the price of goods and services purchased by consumers.
2022 was rough: inflation, energy crisis, and plenty of other controversial situations…