Wednesday Briefing: From DXY, Gold to Latest FX Headlines; Feb 01, 2023

US Dollar Index Overview

  • DXY spikes down after U.S. ADP job data and stabilizes below 102.00 mark.
  • It made intraday high at 102.18 and low at 101.71 mark.
  • A day Chart and H1 chart with triple EMA suggest down trend for the time being.
  • Immediate hurdles are seen at 102.15 to 101.65 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 remains volatile as U.S. released ADP job results with Negative numbers.
  • Traders eye U.S. ISM manufacturing PMI as well as FOMC interest Rate decision later today.
  • The pair made intraday high at $1,933 and Low at $1,923 mark.
  • A day chart and H1 chart with triple EMA suggest up trend for the time being.
  • A sustained close above $1,934 on H1 chart requires for the upside rally.
  • Alternatively, a consistent close below $1,922 on H1 chart will test further supports.

Key Headlines for the FX market:

  • Federal Reserve’s benchmark interest rate shows a near 90% probability that the central bank announces a 25 basis-point rate hike on Wednesday.
  • The latest JPMorgan Treasury positioning survey has also shown clients moving into shorts, and positioning is now at its most bearish in seven weeks.
  • News that the United States could soon send rockets nearly doubling the firing range of Ukrainian forces gave Kyiv a big lift, even as its troops were being pushed back by a relentless Russian winter offensive in the east.
  • Up to half a million British teachers, civil servants, and train drivers walked out over pay in the largest coordinated strike action for a decade, with unions threatening more disruption as the government digs its heels in over pay demands.
  • More than a year after the chaotic U.S. withdrawal from Kabul, the number of Afghans crossing the U.S.-Mexico border to seek asylum in the United States has soared.
  • President Joe Biden and Republican House Speaker Kevin McCarthy are set to discuss the nation’s $31.4 trillion debt ceiling today, a meeting that will give a first sign of how the two will work together, or fail to, in a divided Washington.
  • The Colorado River, which provides drinking water to 40 million people in seven U.S. states, is drying up, straining a water distribution pact amid the worst drought in 12 centuries, exacerbated by climate change.
  • Indian tycoon Gautam Adani lost his title of Asia’s richest person as a rout in his conglomerate’s biggest companies deepened to $84 billion in the wake of a short-seller report.
  • Volatility-linked funds estimated to be buying as much as $2 billion in U.S. equities daily are helping drive this year’s rebound in stocks and may ramp up purchases in coming weeks, though a hawkish Federal Reserve could spoil the party.

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