The negative impact of risk appetite on the dollar is offset by higher yields

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This is what you need to know to trade today Thursday, October 21:

The risk-positive market environment makes it difficult for the dollar to find demand in the second half of the week, but rising US Treasury yields continue to help the currency limit its losses against its main rivals. Ahead of the US mid-level data releases – weekly jobless claims, existing home sales and the Philadelphia Fed manufacturing survey, the US dollar index remains above 93.50.

Macro data: Eurozone data on Wednesday showed that the annual consumer price index held steady at 3.4% in September, as expected. In Canada, the CPI rose to 4.4% from 4.1% and beat market expectations of 4.3%. The Federal Reserve’s Beige Book showed that the US economy continued to grow at a “modest to moderate” rate in September and early October. “Many companies raised sales prices indicating greater ability to pass on cost increases to clients amid strong demand,” the publication revealed.

Wall Street: The S&P 500 Index gained 0.37% and remains just shy of the all-time high it set at 4,545 in early September. The Dow Jones Industrial Average rose 0.43% and the Nasdaq Composite was virtually unchanged at the close. It is also worth noting that US stock futures have fallen by 0.3% to 0.4% at the start of the European session, suggesting that investors might look for an opportunity to reserve their gains before the weekend. Additionally, the Nikkei 225 Index is down more than 1.5%. Meanwhile, Reuters reported that Chinese real estate giant Evergrande obtained a $ 260 million bond extension on default.

The yield of US Treasuries at 10 years, which closed the previous four days in positive territory, remains relatively calm at around 1.65%.

The slightly bullish bias from EUR / USD remains intact, but the pair appears to have entered a consolidation phase around the 1.1650 area. The dollar market valuation is likely to remain the main driver of the cross’s action.

GBP/USD staged a downward correction after UK CPI data fell below analysts’ estimate, but then managed to return to the 1.3800 area. The expectations of a rate hike from the Bank of England support the British pound.

One more time, AUD/USD and NZD / USD they capitalized on risk flows on Wednesday and posted impressive gains. A negative change in market sentiment could trigger a lagged correction in those pairs.

The oro It rose 0.7% on Wednesday and is clinging to small gains above $ 1,780 on Thursday. Key resistance for the XAU / USD lines up at $ 1,800 and a daily close above that level could bring in additional buyers.

cryptocurrencies: Bitcoin It hit a new all-time high of $ 67,000 on Wednesday and fell to $ 65,000 on Thursday. Institutional demand following the introduction of the first BTC ETF is expected to increase and support Bitcoin. Ethereum It also capitalized on the upbeat sentiment surrounding cryptocurrencies and broke above $ 4,000.

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