This is what you need to know to trade today Thursday, November 11:
The US dollar capitalized on rising US Treasury yields and risk aversion on Wednesday after US data showed consumer inflation jumped to its strongest level in more than 30 years. The US Dollar DXY Index consolidates Wednesday’s gains below the 95.00 level and the benchmark 10-year bond yield sits above 1.5%. Bond markets in the United States will be closed due to the Veterans Day holiday on Thursday, but Wall Street will open at the usual time. After Wednesday’s crazy price action, markets could remain relatively calm amid low-volume trading conditions.
Macro events: The US Bureau of Labor Statistics reported on Wednesday that the CPI consumer price index rose to 6.2% annually in October from the 5.4% seen in September, marking the highest figure since 1990. In addition, the core CPI rose to 4.6 % from 4%. The benchmark 10-year US Treasury yield rose nearly 8%, providing a boost to the dollar. CME Group’s FedWatch tool now shows that markets are pricing in a greater than 70% probability of a Fed rate hike by June 2022.
During the Asian session on Thursday, data released by the Australian Bureau of Statistics revealed that the unemployment rate rose to 5.2% in October from 4.6% in September. What is more worrying is that job change fell by -46,300 people in the same period, well below the market expectation of a 50,000 new job increase by a wide margin.
The UK Office for National Statistics has announced that gross domestic product GDP grew 1.3% on a quarterly basis in the third quarter, losing the market’s expectation of 1.5%.
Market sentiment: Inflation fears weighed heavily on stock markets on Wednesday. The Nasdaq Composite fell more than 1.5%, the S&P 500 lost 0.8% and the Dow Jones Industrial Average was down 0.66% at the close. At the start of the European session, US stock index futures are registering small gains. On a positive note, Chinese real estate giant Evergrande has paid its $ 148 million bond coupons and avoided a formal default. China’s Shanghai Composite Index is up more than 1% and the Nikkei 225 is up 0.6%.
The EUR/USD It broke below 1.1500 and touched its lowest level since July 2020 at 1.1465. Currently, the pair is moving in a very tight range below 1.1500.
The reaction of GBP/USD The UK GDP was relatively quiet and the pair is posting small recovery gains above 1.3400. Meanwhile, European Commission Vice President Maros Sefcovic told EU ambassadors that engagement with Britain on Brexit was not going well.
The USD/JPY it spiked higher on the back of rising US bond yields and snapped a five-day losing streak. The pair is now looking to test the 114.00 level.
The oro it found demand as a hedge against inflation after the US CPI data and reached its highest level since June near $ 1,870 before entering a consolidation phase. The bullish momentum appears to have gained traction after the XAU / USD broke above the stiff $ 1,835 resistance zone.
The AUD/USD It lost more than 50 pips on Wednesday and extended its slide early Thursday after the disappointing jobs report. The pair is currently trading at a new monthly low near 0.7300.
Cryptocurrencies: The Bitcoin It posted a new all-time high at $ 69,000, but ended up closing the day deep in negative territory around $ 65,000 on Wednesday. At the time of writing, the BTC / USD is practically unchanged on the day. The Ethereum it lost its bullish momentum before testing $ 5,000 and remains calm around $ 4,700 on Thursday.
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