Currencies
Bets the US dollar keeps falling, to extend a downtrend which began last March, hit an almost decade high last week, positioning data shows. Looking ahead to Tuesday’s trading session, we see a fairly light economic calendar in terms of potential catalysts for US Dollar volatility. The yen was steady at 103.76 per dollar, while the risk-sensitive Australian and New Zealand dollars softened marginally. This potential technical support level underpinning the 90.00-handle could help keep the US Dollar afloat and rebound potential in focus.
Evidence of demand for safe-haven currencies like the US Dollar could have contributed to EUR/USD selling pressure also. That said, a breakdown below this barrier might motivate US Dollar bears to wrestle back control and set their sights on year-to-date lows. Further down the horizon, an arguably larger driver of US Dollar volatility will be the two-day Federal Reserve meeting set to kick off tomorrow. The euro and yen are likewise hemmed in, with the euro unable to break resistance around $1.2190 while the continent grapples with new Covid-19 infections and fresh lockdowns.
The broader US Dollar advanced slightly during Monday’s trading session. Interestingly, the US Dollar traded on its front foot despite a notable 7-basis point drop in 10-year Treasury yields.
Evidence of demand for safe-haven currencies like the US Dollar could have contributed to EUR/USD selling pressure also. That said, a breakdown below this barrier might motivate US Dollar bears to wrestle back control and set their sights on year-to-date lows. Further down the horizon, an arguably larger driver of US Dollar volatility will be the two-day Federal Reserve meeting set to kick off tomorrow. The euro and yen are likewise hemmed in, with the euro unable to break resistance around $1.2190 while the continent grapples with new Covid-19 infections and fresh lockdowns.
The broader US Dollar advanced slightly during Monday’s trading session. Interestingly, the US Dollar traded on its front foot despite a notable 7-basis point drop in 10-year Treasury yields.
Metals
Survival TipsBring me my bow of burning gold, bring me my arrows of desire, bring my my spear, O clouds unfold, bring me my chariots of fire. Spot gold prices rose $2.7261 or 0.2 per cent, to$1,855.28 an ounce.
Oil
US crude ended 50 cents,or 1 per cent, higher at $52.77 a barrel.
United States
“Dovish Fed policy is a key driver for our view of upside in risk assets and bearish USD view. “Support from the Fed and fiscal intervention is badly needed and we expect the (Fed) will dismiss any suggestion of early tapering.”
Europe
Ian WishartWhat s HappeningVaccine Anger | EU regulators proposed requiring drug companies to declare exports of coronavirus vaccines in advance as the bloc seeks to step up inoculations. TP ICAP, the world s largest interdealer broker, was prevented from serving all its EU clients because it hadn t completed its planned relocation of staff to Paris. EU turns the screws.
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