Forex Today: Yields, the Fed and the dollar

FXStreet Team FXStreet

What you need to know on Thursday, May 20:

The dollar edged higher across the board, ending the day with gains against most major rivals. The FOMC released the Minutes of its latest meeting, and while the document showed that officials maintain their cautious stance, some of them are willing to discuss tapering in the next few meetings. That line triggered a run in yields, and put pressure on equities.

The yield on the 10-year US Treasury note peaked at 1.69%, to finish the day at 1.67%. Wall Street got to bounce from intraday lows, but the three major indexes closed in the red.

The EUR/USD pair settled around 1.2160, while GBP/USD hovers a handful of pips above the 1.4100 threshold. Commodity-lined currencies were affected by the poor performance of equities and falling gold and oil prices.

The bright metal surged to $1,889.96 a troy ounce, but trimmed most of its gains ahead of the close, ending the day around 1,870.00. WTI settled at $ 63.30 a barrel, bouncing from a fresh weekly low of 61.93.

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EUR/USD weakens to near 1.1900 as traders eye US data

EUR/USD eases to near 1.1900 in Tuesday's European trading hours, snapping the two-day winning streak. Markets turn cautious, lifting the haven demand for the US Dollar ahead of the release of key US economic data, including Retail Sales and ADP Employment Change 4-week average.

GBP/USD stays in the red below 1.3700 on renewed USD demand

GBP/USD trades on a weaker note below 1.3700 in the European session on Tuesday. The pair faces challenges due to renewed US Dollar demand, UK political risks and rising expectations of a March Bank of England rate cut. The immediate focus is now on the US Retail Sales data.

Gold sticks to modest losses above $5,000 ahead of US data

Gold sticks to modest intraday losses through the first half of the European session, though it holds comfortably above the $5,000 psychological mark and the daily swing low. The outcome of Japan's snap election on Sunday removes political uncertainty, which along with signs of easing tensions in the Middle East, remains supportive of the upbeat market mood. This turns out to be a key factor exerting downward pressure on the safe-haven precious metal.

Bitcoin Cash trades lower, risks dead-cat bounce amid bearish signals

Bitcoin Cash trades in the red below $522 at the time of writing on Tuesday, after multiple rejections at key resistance. BCH’s derivatives and on-chain indicators point to growing bearish sentiment and raise the risk of a dead-cat bounce toward lower support levels.

Follow the money, what USD/JPY in Tokyo is really telling you

Over the past two Tokyo sessions, this has not been a rate story. Not even close. Interest rate differentials have been spectators, not drivers. What has moved USD/JPY in local hours has been flow and flow alone.

Bitcoin Cash trades lower, risks dead-cat bounce amid bearish signals

Bitcoin Cash (BCH) trades in the red below $522 at the time of writing on Tuesday, after multiple rejections at key resistance. BCH’s derivatives and on-chain indicators point to growing bearish sentiment and raise the risk of a dead-cat bounce toward lower support levels.