Market Review - 12/06/2020  00:00GMT  

Dollar rallies broadly on safe-haven demand after plunge in U.S. stocks

The greenback snapped its recent recent losing streak and rallied across the board except versus yen as plunge in U.S. stocks (Dow closed down 6.9% at 25128) triggered active safe-haven usd buying in hectic New York session.  
On the data front, Reuters reported new applications for state unemployment benefits fell to a seasonally adjusted 1.542 million for the week ended June 6, from 1.897 million the prior week, the Labor Department said on Thursday. That pulled initial claims further away from a record 6.867 million in late March.    
Economists polled by Reuters had forecast 1.55 million claims in the latest.  
Versus the Japanese yen, although dollar moved sideways in Asia and rebounded from 106.90 to 107.23, renewed selling emerged and knocked price down to 106.80 in European morning on cross-buying in jpy. However, the pair then recovered to 107.13 on short-covering but only to tumble to a near 1-month low at 106.58 in New York on selloff in U.S. equities before staging a recovery.  
The single currency went through a roller-coaster ride as despite falling from 1.1396 in Asian morning to 1.1326 on profit-taking, the pair rallied to 1.1401 in Europe on cross-buying in euro, especially versus sterling but only to retreat to 1.1337 at New York morning. Price then rose again to session highs of 1.1403 before tumbling to 1.1289 at New York close.  
Reuters reported the European Central Bank will do anything possible to ensure that the current crisis is not made worse by a credit crunch, its Chief Economist Philip Lane told Il Sole 24 Ore in an interview published on Thursday.    When asked if any new interest cuts were possible, Lane added that the net asset purchases under the Pandemic Emergency Purchase Programme (PEPP) had proven to be particularly effective in the current state of uncertainty and market stress.   
The British pound met renewed selling at 1.2754 in Australia and fell to 1.2651 in European morning on profit-taking after rising for ten consecutive days before recovering to 1.2719 but only to drop to 1.2634 in New York morning. Despite a rebound to 1.2684, cable later tumbled to 1.2587 at New York close.  
In other news, Reuters reported China and the United States should resume timely communication on trade and other issues, an adviser to the Chinese cabinet said on Thursday, stressing that the world's two biggest economies are too intertwined to be decoupled.   
Data to be released on Friday :  
New Zealand manufacturing PMI, food price index, Japan industrial output, capacity utilization, UK GDP, industrial output, manufacturing output, construction output, trade balance, NIESR GDP estimate, France CPI, EU industrial production, U.S. import prices, export prices, University of Michigan sentiment, and Canada capacity utilization.  

Trendsetter does not warrant or guarantee the accuracy, timeliness or completeness to its service or information contained therein. Trendsetter does not give, whatsoever, warranties, expressed or implied, to the results to be obtained by using its services or information it provided. Users are trading on their own risk and Trendsetter shall not be responsible under any circumstances for the consequences of such activities. Trendsetter and its affiliates, in no event, be liable to users or any third parties for any consequential damages, however arising, including but not limited to damages caused by negligence whether such damages were foreseen or unforeseen.

Analysis feed

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Analysis

Latest Forex Analysis

Editors’ Picks

AUD/USD regains traction to 0.7800 on upbeat Australian trade numbers, ignores soft Retail Sales

AUD/USD picks up bids from the intraday low on strong trade data. The quote extends bounce off 0.7752 following the upbeat trade figures for January while also paying a little heed to the soft Retail Sales figure for the stated month.


GBP/USD: Drops towards 1.3900 on the way to two-week-old support line

GBP/USD teases intraday low of 1.3921, currently down 0.14% around 1.3932, during Thursday’s Asian session. In doing so, the cable stretches the pullback from a one-week-old resistance line as MACD recedes bullish bias.


Gold: Bears looking to test bull's commitments at $1,698

The gold price is no longer showing signs of an immediate advance back to test $1,760. Instead, gold failed to extend beyond $1,740 and printed a fresh low to $1,702 as the US dollar and yields came up for air.

Gold News

Dogecoin price on the brink of a 40% explosion towards $0.07

Dogecoin price has been trading sideways for the past two days and inside a downtrend since its new all-time high of $0.087 on February 7. Now, the favorite canine-cryptocurrency is ready for a new leg up.

Read more

DXY continues to gain on Wednesday, eyes 91.60

US dollar firm and approaching Feb 4th highs from a significant technical support structure. US economy moderately gathering pace according to the Fed's Beige Book.

US Dollar Index News

Forex Majors