Gold & S&P 500 at new highs following dollar fall

Chris Beauchamp IG

The dollar's slump has been felt across the globe, says Chris Beauchamp, Chief Market Analyst at investing and trading platform IG.

Gold at new high amid dollar rout

Those hoping for a quiet day ahead of tech earnings and the Fed decision have been disappointed. Investors are digesting the ramifications of Trump’s decision to give the dollar a shove lower. It is most likely a reaffirmation of his desire to engender a fresh stock market boom ahead of the mid-terms, to help offset his struggling poll ratings, if indeed there is any strategy behind it. For gold bugs the news is manna from heaven, promising the breaking of more records in the weeks to come.

S&P 500 hits a fresh round number

The psychological levels continue to fall like dominos this January. The S&P 500 briefly cleared 7000 for the first time, emboldened by hopes that a weakening dollar and interest rates will produce a potent cocktail to supercharge earnings in the months to come. Now it is up to big tech and the Fed to deliver the right kind of figures tonight in order to avoid spoiling the party.

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Chris Beauchamp

EUR/USD loses further momentum, revisits 1.1930

EUR/USD surrenders further ground and approaches the 1.1930 region, or daily troughs, on Wednesday. The pair has retreated from a five-year high as US Dollar demand picks up again, with traders turning cautious ahead of the key Fed meeting later in the European evening.

GBP/USD remains offered, focus is on 1.3750

GBP/USD is clocking marked losses near the 1.3750 zone midweek. Cable’s pullback comes as the Greenback stages a robust bounce, with traders taking profits and squaring positions ahead of the Fed’s key policy announcements later in the day.

Gold retreats from record highs ahead of Fed’s decision

Gold now gives away part of the earlier bull run to all-time highs past the $5,300 mark per troy ounce on Wednesday. Investors continued to seek out traditional safe havens amid persistent economic and geopolitical uncertainty, with markets also staying cautious ahead of the FOMC event later in the day.