Five reasons why USD is tanking – USD and AUD interest rates this week [Video]

In today’s Market Outlook, let’s take a look at Forex Trading on the NASDAQ, Gold, XAU/USD, Silver, XAG/USD, USD/JPY and GBP/USD.

This week, USD has taken a big hit, and there are many reasons for this.

Firstly, after Davos last week and months of crazy tariffs, global economies are now considering US debt, US policies, and general political chaos to be too risky, and many are dumping US debt instruments.

Secondly, stronger performances by other currencies like GBP and JPY are outperforming USD.

Thirdly, there is a lot of speculation that most other central banks will adjust monetary policy to distance themselves from the US.

Fourthly, many investors are looking for safe havens away from USD, like Gold, and we will come back to that.

Fifthly, there is still speculation that the Fed will lower interest rates sometime this year.

We see that the prediction for Wednesday includes no rate change, but the FOMC Statement and Press Conference will tell us a lot more.

Also, we see CPI from Australia, an interest rate decision and GDP from Canada, and PPI from the US.

We see that AUD is quite strong at the moment against many currencies.

If the news gives us a pullback, against the trend, we then have an opportunity to trade with the trend.

We saw price action across all precious metals, not just gold and silver, pull back with a bit of profit-taking. 

However, we are still over $5,000 and $100, respectively.

This profit-taking was shifted into a risk-on mood in the stock markets as the NASDAQ, for example, is heading back to record highs.

You will note that we often use MACD as a technical indicator.

MACD stands for Moving Average Convergence/Divergence, and cTrader has 2 different types.

Under Indicators, Oscillators, you have MACD Histogram, which shows us a bearish and bullish histogram and a signal line.

When the histogram passes above or below the zero line, we may expect sustained price action on that respective side.

When the signal line passes out of the histogram, we may expect a reversal.

On MACD Crossover, we have a less pronounced histogram but 2 moving averages to indicate reversals.