Friday Briefing: From DXY, Gold to Latest FX Headlines; Feb 24, 2023

US Dollar Index Overview

• DXY strengthens on robust U.S. economic results and hits highest level since Jan 06, 2023.
• It made intraday high at 105.32 and low at 104.21 mark.
• A day Chart and H1 chart with triple EMA suggest up trend for the time being.
• Immediate hurdles are seen at 104.71 to 105.37 mark.
• A sustained close of either side on H1 chart requires for the further directions of the U.S. dollar.

Technical Analysis: XAU/USD (Gold)

• Gold weakens sharply as U.S. release majority of key economic data with the positive numbers.
• The pair made intraday high at $1,827 and Low at $1,809 mark.
• A day chart and H1 chart with triple EMA suggest down trend for the time being.
• A sustained close above $1,822 on H1 chart requires for the upside rally.
• Alternatively, a consistent close below $1,808 on H1 chart will test further supports.

 
Key Headlines for the FX market:

• U.S. PCE Price Index m/m stands at 0.6 pct vs 0.4 pct previous release.
• U.S. New Home Sales stands at 670 K vs 625K previous release.
• U.S. Revised UoM consumer sentiment stands at 67.0 vs 66.4 previous release.
• Ukrainians paid tribute to their fallen loved ones and vowed to fight on to victory, while Russia said its forces were making gains in battles in the east as its invasion entered a second year with no end in sight.
• U.S. consumer spending increased by the most in nearly two years in January amid a surge in wage gains, while inflation accelerated, adding to financial market fears that the Federal Reserve could continue raising interest rates through summer.
• Two Federal Reserve regional bank measures that map bond yields to the economic outlook still put better-than-even chances of a U.S. recession by next year, even as recent gauges of activity in everything from consumer spending to hiring show little evidence of a pending slowdown.
• Finance leaders of the world’s top economies sought on Friday to bridge differences over how to deal with Russia following its year-old invasion of Ukraine as the West stepped up sanctions against Moscow.
• U.S. Treasury Secretary Janet Yellen accused Russian officials at the two-day Group of Twenty (G20) meeting in the Indian city of Bengaluru of being “complicit” in war atrocities.
• President Joe Biden dramatically emphasized U.S. backing for Ukraine this week with a trip to the country, but back home public support for sending weapons is softening as the conflict enters its second year with no end in sight.
• China’s effort to cast itself as a peacemaker on Ukraine reflects an aim to burnish its image rather than a change of stance, Western diplomats and analysts said, as it seeks to establish itself as a leader of a new multipolar world order.
• U.S. Secretary of State Antony Blinken said countries like India and South Africa, which have not joined the West in denouncing Russia’s invasion of Ukraine, were likely on a trajectory away from alignment with Moscow but that process would not happen “in one fell swoop.”

Source: Reuters

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

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