Friday Briefing: From DXY, Gold to Latest FX Headlines; Aug 19, 2022

US Dollar Index Overview

  • The DXY strengthens on Friday and hits highest level since July 15, 2022.
  • It made intraday high at 108.07 and low at 107.46 mark.
  • A day Chart and H1 chart with triple EMA suggest bullish trend for the time being.
  • Immediate hurdles are seen at 108.12 to 107.72 mark.
  • A sustained close of either side on H1 chart requires for the further directions of the U.S. dollar.

Technical Analysis:

Gold (XAU/USD):

  • Gold trades noticeably lower on Friday as U.S. calendar will remain empty for the day.
  • The pair made intraday high at $1,759 and Low at $1,749 mark.
  • A day chart and H1 chart with triple EMA suggest bearish trend for the time being.
  • A sustained close above $1,762 on H1 chart requires for the upside rally.
  • Alternatively, a consistent close below $1,748 on H1 chart will test further supports.
$1,748 $1,762
$1,742 $1,768
$1,737 $1,772
$1,732 $1,778
$1,726 $1,784

Key Headlines for the FX market:

  • China has issued its first national drought alert of the year as authorities battle forest fires and mobilize specialist teams to protect crops from scorching temperatures across the Yangtze river basin.
  • North Korea’s Kim Yo Jong, the powerful sister of leader Kim Jong Un, said South Korea’s president should “shut his mouth” after he reiterated that his country was willing to provide economic aid in return for nuclear disarmament.
  • Angolans head to the polls next week in what is likely to be a tense standoff between a ruling party in power for nearly five decades and an opposition with growing appeal to a frustrated, impoverished youth.
  • German producer prices jumped at the fastest pace on record in July, underscoring the gloomy outlook for Europe’s largest economy, which is stuck in a stranglehold of soaring costs and weakening growth due to the Ukraine war.
  • The German economy became more dependent on China in the first half of 2022, with direct investment and its trade deficit reaching new heights, according to research seen by Reuters.
  • Britain’s financial watchdog has told firms offering ‘buy now, pay later’ loans to spell out the cost of late repayments to customers as the cost-of-living crisis intensifies.
  • Cryptocurrencies fell sharply on Friday, with sudden selling dragging bitcoin to a three-week low.
  • German Chancellor Olaf Scholz is to testify in front of lawmakers on Friday over his role as Hamburg mayor in tackling a multibillion-euro tax fraud in a case that threatens to tarnish him even as he battles multiple crises.
  • Taiwan’s defence ministry said 17 Chinese aircraft and six Chinese ships were detected operating around Taiwan on Friday as Beijing continued military activities near the island.
  • Internet connectivity was fully restored in central and northern parts of Pakistan on Friday after an hours-long outage caused by heavy rains and floods, the country’s telecom regulator said.

Latest updates on Russia – Ukraine Conflicts:

  • Explosions erupted overnight near military bases deep within Russian-held areas of Ukraine and in Russia itself, an apparent display of Kyiv’s growing ability to wreak havoc on Moscow’s logistics far from front lines.
  • A former mayor of a Russian city has been appointed to head a new Russian-installed government in northeastern Ukraine, the latest in a string of such appointments which Kyiv says are part of attempts to annexe its territory.

Source: Reuters

Keep an eye open for the latest news and fundamentals affecting the FX markets.

Take a look and do trade wisely!
Good Luck