- Wall Street's main indexes post modest gains in early trade.
- Retail sales in July rose 0.7% to beat analysts' estimates.
- US Dollar Index extends gains above 98 in NA session.
Following a drop to 105.80 earlier in the day, the USD/JPY pair reversed its direction and rose above the 106 handle in the early trading hours of the North American session supported by broad-based USD strength and slightly improved market sentiment. As of writing, the pair was up 0.3% on the day at 106.20.
On the back of upbeat retail sales data and strong second-quarter earnings figures from retail-giant Walmart, major equity indexes in the US started the day modestly higher and now continue to extend their gains, making it difficult for the safe-haven JPY to find demand. The US Census Bureau today reported that retail sales in July increased by 0.7% to beat the market expectation of 0.3%.
Additionally, the improved market sentiment allows the 10-year US Treasury bond yield, which slumped to its lowest level in nearly three years at 1.52% earlier today, to erase its losses and support the USD/JPY's rebound.
DXY gains traction
On the other hand, the Greenback gathered strength in the last hours to provide an additional boost to the pair. Although the US Dollar Index (DXY) struggled to break above the 98 mark despite the inspiring data, the fact that the EUR/USD pair fell sharply in the last hour following reports of the ECB announcing a stimulus package that could overshoot investors' expectations caused the DXY to rise to its highest level since August 2 at 98.24. At the moment, the index is up 0.22% on the day at 98.17.
Technical levels to watch for
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD turns negative near 1.1140 on Dollar's rebound
The Dollar's recovery now gathers extra steam and put the risk complex under pressure, motivating EUR/USD to give away previous gains and accelerate its decline to the area of daily lows around 1.1140.
GBP/USD loses momentum and breaks below 1.3400
Quite a marked bounce in the Greenback prompts GBP/USD to face renewed downside pressure and breach the key support around 1.3400 the figure ahead of the speech by Chair Powell.
Gold extends slide and pierces $2,630
Gold extends its downward correction to start the week and trades deep in negative territory near $2,630. Profit-taking ahead of the long Chinese holiday and the cautious market mood seems to be weighing on XAU/USD as markets await Fed Chairman Powell's speech.
Johann Kerbrat, Robinhood Crypto GM: “US regulation to be late compared to EU and Asia”
Johann Kerbrat is the Crypto General Manager at Robinhood, the trading app used by many US retail investors during the 2020 meme stock mania.
RBA widely expected to keep key interest rate unchanged amid persisting price pressures
The Reserve Bank of Australia is likely to continue bucking the trend adopted by major central banks of the dovish policy pivot, opting to maintain the policy for the seventh consecutive meeting on Tuesday.
Five best Forex brokers in 2024
VERIFIED Choosing the best Forex broker in 2024 requires careful consideration of certain essential factors. With the wide array of options available, it is crucial to find a broker that aligns with your trading style, experience level, and financial goals.