AUD/USD intermarket: consolidation during market stability, watching EFFR

Ross J Burland FXStreet

AUD/USD is stabilizing again after a period in March where the VIX dropped, supportive of the Aussie's strength and a seven cent rally to 0.7829 which was then shattered by the Fed's upbeatness around the US economy in late April along with the RBA's interest rate cut and downgrade of inflation forecasts. Subsequently, we had a strong rise in the Expected Fed Fund Rate (EFFR) creating a divergence between the AU10Y and US10Y again after a brief period of convergence.

While Gold and copper have been in a period of heavy decline since the end of April, Oil has been making its way back towards $50bbl crude, but this has diverged from the performance of the Aussie moving more in tandem with the industrials and adding more weight to the impact of market expectations for a Fed hike and the recent stability in the market volatility seen through the VIX.

Further reading in respct to the Fed: Déjà Vu: Will the Fed actually hike?

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

EUR/USD loses ground below 1.1850 ahead of FOMC Minutes

The EUR/USD pair loses traction near 1.1840 during the early European session on Wednesday, pressured by renewed US Dollar demand. Traders brace for the Federal Open Market Committee Minutes for signals on future rate cuts, which will be released later on Wednesday.

When is the UK CPI data and how could it affect GBP/USD?

The United Kingdom Consumer Price Index data for January is scheduled to be published today at 07:00 GMT. GBP/USD trades slightly lower at around 1.3556 as of writing. The 20-period Exponential Moving Average trends lower at 1.3593 and continues to cap rebounds. Price holds beneath this gauge, maintaining a short-term bearish bias.

Gold: Is the $5,000 level back in sight?

Gold snaps a two-day downtrend, as recovery gathers traction toward $5,000 on Wednesday. The US Dollar recovers from the overnight sell-off as rebalancing trades resume ahead of Fed Minutes. The 38.2% Fib support holds on the daily chart for now. What does that mean for Gold?

Pi Network rally defies market pressure ahead of its first anniversary

Pi Network is trading above $0.1900 at press time on Wednesday, extending the weekly gains by nearly 8% so far. The steady recovery is supported by a short-term pause in mainnet migration, which reduces pressure on the PI token supply for Centralized Exchanges. The technical outlook focuses on the $0.1919 resistance as bullish momentum increases.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Top 3 Price Prediction: Bitcoin, Ethereum, and Ripple face downside risk as bears regain control

Bitcoin, Ethereum, and Ripple remain under pressure on Wednesday, with the broader trend still sideways. BTC is edging below $68,000, nearing the lower consolidating boundary, while ETH and XRP also declined slightly, approaching their key supports.