Wednesday Briefing: From DXY, Gold to Latest FX Headlines Ahead of U.S. Fed Meet; Sept 21, 2022

US Dollar Index Overview

  • The DXY strengthens on Wednesday ahead of U.S. FOMC meeting and stabilizes above 110.50 mark.
  • It made intraday high at 110.80 and low at 110.13 mark.
  • A day Chart and H1 chart with triple EMA up down trend for the time being.
  • Immediate hurdles are seen at 110.82 to 110.30 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 appreciates slightly on Wednesday ahead of U.S. FOMC Interest rate decision and remains well supported below $1,680 mark.
  • The pair made intraday high at $1,677 and Low at $1,661 mark.
  • A day chart is down and H1 chart with triple EMA suggests up trend for the time being.
  • A sustained close above $1,678 on H1 chart requires for the upside rally.
  • Alternatively, a consistent close below $1,662 on H1 chart will test further supports.

Key Headlines for the FX market:

  • Stocks fell, while safe havens such as government bonds and the dollar rose, as already anxious investors fled risk assets. With the U.S. Federal Reserve due to deliver another aggressive rate hike later in the day, in a week packed with major central bank decisions, key market measures of volatility neared multi-week highs.
  • President Vladimir Putin ordered Russia’s first mobilization since World War Two, warning the West that if it continued what he called its “nuclear blackmail” that Moscow would respond with the might of all its vast arsenal.
  • If the territorial integrity of our country is threatened, we will use all available means to protect our people – this is not a bluff,” Putin said in a televised address to the nation, adding Russia had “lots of weapons to reply”.
  • One-way flights out of Russia were selling out fast after Putin ordered the immediate call-up of 300,000 reservists, and Russia’s opposition called for protests.
  • Residents of the Ukrainian capital Kyiv dismissed Putin’s move as a mark of desperation and expressed confidence in their own armed forces to drive Russian troops from their country.
  • The European Union’s executive body told Putin to stop his “reckless” nuclear gamble, while Britain said the threats must be taken seriously.
  • Germany nationalized gas importer Uniper and Britain capped the wholesale cost of electricity and gas for businesses, in Europe’s latest moves to keep the lights on and heaters running this winter.
  • As Greece gives energy savers bigger power bill subsidies and Italian fruit farmers use hill caves to help cut energy bills, Reuters columnist Gavin Maguire asks if Europe should risk the social fallout and lean towards more nuclear.
  • A quadrillion yen is lying idle with Japanese households, ready to be shipped overseas when yields abroad turn more attractive, and that moment could arrive as soon as this week.

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