US Dollar trims losses, back around 92.70

Pablo Piovano FXStreet

The greenback, when gauged by the US Dollar Index (DXY), remains on the defensive today although it has managed to bounce off earlier session lows near 92.60.

US Dollar offered post-FOMC

The index has been losing ground since last Friday, when it was rejected from multi-week tops in the 94.30 area in the wake of US payrolls for the month of September.

The down move has been accompanied by a moderate correction lower in yields of the key 10-year benchmark, currently testing daily lows in the 2.32% neighbourhood and shedding around 8 bp since post-payrolls tops around 2.40%.

Market participants perceived as dovish yesterday’s FOMC minutes, as inflation could now stay in low levels for longer, while the Committee gave no clues regarding the Fed’s target for its balance sheet.

In the US data space, the usual report on initial claims is due, seconded by September’s producer prices and speeches by FOMC’s L.Brainard (permanent voter, mega-dovish) and J.Powell (permanent voter, dovish).

US Dollar relevant levels

As of writing the index is losing 0.09% at 92.71 facing the initial support at 92.64 (low Oct.12) seconded by 91.53 (low Sep.20) and then 91.01 (2017 low Sep.4). On the upside, a breakout of 93.42 (10-day sma) would open the door to 94.03 (23.6% Fibo of the 2017 drop) and finally 94.27 (high Oct.6).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

EUR/USD clings to strong gains above 1.1850 on USD weakness

EUR/USD preserves its bullish momentum to start the week and trades above 1.1850. The US Dollar struggles to find demand ahead of Wednesday's critical January employment report and helps the pair continue to push higher.

GBP/USD hovers near 1.3600 as UK government crisis weighs on Pound Sterling

GBP/USD moves sideways after registering modest gains in the previous session, trading around 1.3610 during the European hours on Monday. The pair could come under pressure as the Pound Sterling may weaken amid a fresh government crisis in the United Kingdom.

Gold holds steady above $5,000

Gold builds on the gains it posted to end the previous week and holds steady above $5,000 on Monday. Data released over the weekend showed that the People's Bank of China extended its Gold buying spree for a 15th month in January. Moreover, dovish US Fed expectations and concerns about the central bank's independence drag the US Dollar lower for the second straight day, providing an additional boost to the non-yielding yellow metal.

Cardano steadies as whale selling caps recovery

Cardano (ADA) steadies at $0.27 at the time of writing on Monday after slipping more than 5% in the previous week. On-chain data indicate a bearish trend, with certain whales offloading ADA. However, the technical outlook suggests bearish momentum is weakening, raising the possibility of a short-term relief rebound if buying interest picks up.

Japanese PM Takaichi nabs unprecedented victory – US data eyed this week

I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Bitcoin, Ethereum, and Ripple prices consolidated on Monday after correcting by nearly 9%, 8%, and 10% in the previous week, respectively. BTC is hovering around $70,000, while ETH and XRP are facing rejection at key levels. Traders should be cautious: despite recent stabilization, upside recovery for these top three cryptocurrencies is capped as the broader trend remains bearish.