This is what you need to know to trade today Wednesday August 24:
Having snapped a four-day winning streak following disappointing data releases on Tuesday, the Dollar Index (DXY) started to rise early in the European morning on Wednesday. In the absence of high-level data releases, market action turns choppy, with investors remaining cautious ahead of the Jackson Hole Symposium later this week. In the second half of the day, July pending home sales and durable goods orders data will feature on the US economic docket. Meanwhile, US stock index futures post modest losses and the 10-year US Treasury yield continues to fluctuate above 3%.
On Tuesday, US data revealed that business activity in the private sector continued to contract in August, with the S&P Global Composite PMI falling to 45 from 47.7 in July. Other data showed that new home sales fell 12.6% in July, following a 7.1% contraction in June. The dollar lost interest after this data and the DXY lost almost 0.5% on the day. However, CME Group’s FedWatch tool shows that markets continue to price in a 51.5% chance of a 75 basis point rate hike in September.
Several media outlets reported on Tuesday that OPEC+ could lean towards oil production cuts when Iranian production returns, depending on the revival of the nuclear deal. The oil prices Crude continued to rise with West Texas Intermediate a barrel gaining 3.5% before settling near $94.00.
The pair EUR/USD staged a rebound and tried to regain parity after falling on Tuesday to its weakest level in almost 20 years, around 0.9900. However, the pair failed to gain any upside momentum and pulled back towards 0.9950 early on Wednesday.
The GBP/USD gained over 50 pips on Tuesday and entered a consolidation phase above 1.1800 during Asian hours on Wednesday. The pair is trading in a relatively tight channel so far today.
The USD/JPY It fell sharply during the American session on Tuesday, but the rebound seen in the 10-year US Treasury bond yield helped it erase a large part of its daily losses. The pair is trading sideways above 136.50 on Wednesday.
The Prayed took advantage of widespread selling pressure surrounding the dollar and posted daily gains for the first time since August 12. XAU/USD struggles to find a direction as it trades up and down in a tight channel below $1750.
The Bitcoin It is struggling to make a decisive move in either direction and is trading near $21,500. The ethereum It posted modest daily gains on Tuesday but is already down more than 1% on the day near $1,600 as of early Wednesday.
Source: Fx Street
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