Forex Today: Coronavirus surpasses SARS, Trump's impeachment gets interesting, Fed in focus

Yohay Elam FXStreet

Here is what you need to know on Wednesday, January 29:

Coronavirus: The respiratory disease has already infected 5,974 people, surpassing that of SARS in 2003 as the death toll hit 132. The US and Japan have evacuated citizens out of Wuhan and Starbucks closed all its cafes in China. While the news grabs the headlines, the effect on markets is diminishing. USD/JPY is settling above 109 and Gold is below $1,570.

Impeachment trial: Mitch McConnell, the leader of the Republican majority in the Senate, has reportedly admitted that he is unable to stop the summoning of witnesses. Several of his colleagues want to hear what former adviser John Bolton has to say, potentially revealing explosive evidence of undoing by President Donald Trump. Investors may tune in.

Federal Reserve: The world's most powerful central bank is set to leave interest rates unchanged in its first decision of 2020 and after cutting borrowing costs three times in a row. The recent signs of an inversion in the yield curve is one of the topics on the agenda.

See

Fed Preview: Five things that will determine the dollar's direction
Federal Reserve Preview: Stable policy and an uncertain future

US data: Ahead of the Fed, US data has been mixed. While the Conference Board's Consumer Confidence gauge beat expectations with 131.6 points in January, Durable Goods Orders missed on core figures with the nondefense ex-aircraft figure falling by 0.9%.

Australia: Consumer Price Index rose by 0.7% quarterly and 1.8% yearly, both above expectations. Alongside the upbeat jobs report, the chances that the Reserve Bank of Australia cut rates are low.

Cryptocurrencies have been holding onto high ground, with Bitcoin surpassing $9,300 and Ripple above $0.24.

Author

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

EUR/USD holds losses below 1.1850 near nine-day EMA barrier

EUR/USD extends its losses for the second successive session, trading around 1.1840 during the early European hours on Tuesday. The 14-day Relative Strength Index momentum indicator at 53 (neutral) signals consolidation with a modest upside lean.

GBP/USD drops below 1.3600 after weak UK jobs report

GBP/USD is seeing a fresh selling wave, giving up the 1.3600 level in Tuesday's European trading. The United Kingdom employment data showed worsening labor market conditions, bolstering bets for a BoE interest rate cut next month. This narrative is weighing heavily on the Pound Sterling.

Gold adds to intraday losses as risk-on mood offsets dovish Fed and subdued USD demand

Gold attracts some follow-through selling for the second straight day and dives to over a one-week low, around the $4,858 area, heading into the European session on Tuesday. The commodity, however, quickly recovers to the $4,900 mark as traders opt to await more cues about the US Federal Reserve's (Fed) rate-cut path before placing fresh directional bets.

Pi Network rallies ahead of its first anniversary

Pi Network trades above $0.1800 at the time of writing on Tuesday, recording nearly 5% gains so far. On-chain data indicate that large wallet investors, commonly known as whales, have accumulated approximately 4 million PI tokens over the last 24 hours.

The week ahead: Key inflation readings and why the AI trade could be overdone

It is likely to be a quiet start to the week, with US markets closed on Monday for Presidents Day. European markets are higher across the board and gold is clinging to the $5,000 level after the tamer than expected CPI report in the US reduced haven flows to precious metals.

Stellar mixed sentiment caps recovery

Stellar price remains under pressure, trading at $0.170 on Tuesday after failing to close above the key resistance on Sunday. The derivatives metric supports the bearish sentiment, with XLM’s short bets rising among traders and funding rates turning negative.