Friday Briefing: From DXY, Gold to Latest FX Headlines; Sept 30, 2022

US Dollar Index Overview

  • DXY recovers sharply from previous losses and stabilizes around 112.52 mark.
  • It made intraday high at 112.67 and low at 111.57 mark.
  • A day Chart is up and H1 chart with triple EMA suggests down trend for the time being.
  • Immediate hurdles are seen at 112.75 to 111.67 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 moves in rigid boundaries and trading around $1,666 mark.
  • The pair made intraday high at $1,674 and Low at $1,659 mark.
  • A day chart is down and H1 chart with triple EMA suggests up trend for the time being.
  • A sustained close above $1,674 on H1 chart requires for the upside rally.
  • Alternatively, a consistent close below $1,658 on H1 chart will test further supports.

Key Headlines for the FX market:

  • The Reserve Bank of India raised its benchmark repo rate by 50 basis points, the fourth straight increase, as policymakers extended their battle to tame stubbornly high inflation and analysts said further tightening is on the cards.
  • Japan’s government spent up to $19.7 billion intervening in the foreign exchange market last week to prop up the yen, Ministry of Finance data showed, draining nearly 15% of funds it has readily available for intervention.
  • Prime Minister Liz Truss and her finance minister Kwasi Kwarteng met the head of Britain’s independent fiscal watchdog, whose analysis they previously spurned, in a bid to reassure markets after chaos triggered by planned tax cuts.
  • Euro zone inflation zoomed past forecasts to hit 10.0% in September, a new record high that will reinforce expectations for another jumbo interest rate hike next month from the European Central Bank.
  • European Union countries agreed to impose emergency levies on energy firms’ windfall profits, and began talks on their next move to tackle Europe’s energy crunch – possibly a bloc-wide gas price cap. The energy crisis is siring a new European order: a strong Italy and ailing Germany.
  • Thailand’s Constitutional Court ruled Prime Minister Prayuth Chan-ocha had not exceeded the maximum eight years allowed in office, clearing the way for his return from a five-week suspension.
  • The navies of South Korea, the United States and Japan staged trilateral anti-submarine exercises for the first time in five years, amid tension over North Korea’s series of missile tests.
  • The U.S. House of Representatives is expected today to pass a bill funding the federal government through December 16, avoiding an embarrassing partial shutdown less than six weeks before the midterm elections when control of Congress is at stake.
  • Finland said it would close its border to Russian tourists, shutting off the last remaining direct land route to the European Union for them as thousands of Russians seek to avoid conscription.
  • Putin said that “all mistakes” made in a call-up to reinforce Russia’s military operation in Ukraine should be corrected, his first public acknowledgment that the “partial mobilization” he announced last week had not gone smoothly.
  • Ukrainian President Volodymyr Zelenskiy will hold an emergency top-level meeting today where “fundamental decisions” will be taken, an official said.
  • Russian forces in Ukraine were on the verge of one of their worst defeats of the war even as President Vladimir Putin was due to proclaim the annexation of territory seized in his invasion.

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