USD – The US dollar index was ultimately firmer in a choppy session where DXY hit a low of 103.18 in the APAC session only to reverse course later hitting a high of 103.71 in the US session. A sour risk environment after some misses in US retail earnings and traders getting long before the FOMC minutes seem to be the key drivers. Reaction to the minutes ended up being muted with a slight pop that retraced in quick time.
DXY now sandwiched between its 200-day SMA and key support level at 103.60 heading into the APAC session. AUD – AUDUSD got off to a flier in the APAC session after what was seen as hawkish RBA minutes released early in the session. The Aussie did fade later as it failed to breach key technical resistance at the 200-day SMA at 0.6590 and finished the session flat.
Key levels to watch today will be 0.6524 to the downside which was the top end of its recent range and the aforementioned 200-day SMA to the upside, Aussie traders will have comments from Governor Bullock later today to watch out for. EUR GBP EUR was the G10 laggard with EURUSD hitting a low of 1.0901 before finding some support at the big figure. ECB president Lagarde did speak but failed to inspire the bulls, also some budgetary issue out of Germany weighed on the single currency.
GBP on the other hand outperformed with cable having a positive session after some hawkish commentary from the BoE. This saw a sharp drop in EURGBP from its resistance at 0.8750 and heading towards its lower trend line support. Gold – XAUUSD broke out, setting new November highs and testing the October highs at 2009 before finding some resistance.
This came despite a stronger USD on the session, which would cheer the gold bulls.
By
Lachlan Meakin
Head of Research, GO Markets Australia.
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