Forex Today: Dollar Recovery Halts Before Housing Data

This is what you need to know to trade today tuesday august 16:

The dollar is relatively quiet early on Tuesday as markets await the next major catalyst. The Dollar Index gained more than 1% in the two-day rally that started on Friday and was last seen moving sideways near 106.50. The results of the ZEW survey for the euro zone and Germany will be published on the European economic docket. In the second half of the day, the US Census Bureau will release housing starts and building permits data for July. Meanwhile, markets remain cautious in the European morning, with US stock index futures down 0.06%-0.16%. Lastly, the 10-year US Treasury bond yield remains stable below 2.8%.

Although safe-haven flows dominated financial markets for most of the day on Monday, Wall Street’s major indices managed to close the day modestly higher. China’s National Development and Reform Commission (NDRC), in charge of state planning, announced multiple measures to stave off fears of recession: “We are committed to keeping the economy within reasonable limits.” According to Reuters, the NDRC approved 65 fixed asset investment projects totaling 1.028 trillion yuan from January to July and approved 8 fixed asset investment projects totaling 236.8 billion yuan in July. However, the Shanghai Composite Index was flat on the day at press time.

The AUD/USD lost close to 100 pips on Monday and failed to attempt a rebound. During the Asian session, the Reserve Bank of Australia (RBA) meeting minutes showed that policy makers were willing to take further tightening steps. However, the RBA reiterated that they were not following a pre-established path. At time of writing, the pair is down 0.15% to trade at 0.7015 on the day.

The drop in crude oil prices weighed on the Canadian dollar on Monday and the USD/CAD exceeded 1.2900. Pressured by worsening demand prospects and the possibility of Iranian oil entering the market, West Texas Intermediate fell more than 4% a barrel on Monday before recovering to $88.50 on Tuesday. Later in the session, Statistics Canada will release Consumer Price Index data for July.

After Monday’s sharp drop, the EUR/USD remains quiet near 1.0150 early on Tuesday.

The GBP/USD fell to its weakest level in over a week at 1.2035 during Asian trading hours on Tuesday. Although the pair managed to recover to 1.2050, it is struggling to pick up recovery momentum.

The USD/JPY traded in a relatively wide range on Monday, but closed the day largely unchanged near 133.50. The pair is having a hard time making a decisive move in either direction early in the day.

The Prayed suffered heavy losses and fell towards $1,770 on Monday. With the US 10-year bond yield falling during American trading hours, XAU/USD rose slightly and stabilized near $1,780.

The Bitcoin had a hard time capitalizing on the previous week’s gains on Monday and appears to have entered a consolidation phase around $24,000 on Tuesday. After failing to break above $2,000, Ethereum down and lost 1% on the day to $1,880.