Forex Today: Brexit drama continues, gold keeps advancing

FXStreet Team FXStreet

Here is what you need to know on Wednesday, December 9:

The Brexit drama continues, with contradictory headlines throughout the day. Still, such news had a limited effect on the pound, as investors turned cautious. Mid-European session, British Cabinet Minister Michael Gove has announced that they have reached an agreement in principle.

However, soon afterwards, and according to an EU source, EU’s chief negotiator Michel Barnier told European ministers that the chances of a deal are “very slim.” Even further, German Minister Michael Roth said that there was no substantial progress in the EU-UK trade talks, adding that "it remains totally uncertain whether Britain and EU can reach a trade deal." The latest on the matter is that UK PM Boris Johnson is traveling to Brussels this Wednesday to speak with European Commission President Ursula Von der Leyen. GBP/USD ended the day little changed, around 1.3160.

Most major pairs remained lifeless and confined to tight intraday ranges. The dollar edged higher but is far from bullish. EUR/USD trades above 1.2100, AUD/USD retains the 0.7400 threshold.

Wall Street turned positive during US trading hours after House Speaker Nancy Pelosi said she is hopeful of getting a coronavirus relief deal, providing support for Wall Street. US Treasury yields, on the other hand, ticked lower.

The UK kick-started massive COVID-19 vaccination with Pfizer’s vaccine. Markets payers are cautiously optimistic about an economic comeback while concerned about the current coronavirus developments. Meanwhile, the US continued to report record new contagions. The seven-day average stands at 196K, while the death toll is also at record highs.

Gold kept advancing, reaching $1,875.20 a troy ounce, its highest in two weeks. It closed the day around 1,872.50. Crude oil prices post modest daily losses ahead of US stockpiles reports.

Cryptocurrencies Price Prediction: Ripple, Stellar & Band Protocol – American Wrap 08 Dec

Author

FXStreet Team

FXStreet

EUR/USD holds firm above 1.1900 as US NFP looms

EUR/USD holds its upbeat momentum above 1.1900 in the European trading hours on Wednesday, helped by a broadly weaker US Dollar. Markets could turn cautious later in the day as the delayed US employment report for January will takes center stage.

GBP/USD recovers losses despite rising UK political risks, BoE rate cut bets

Pound Sterling advances against the US Dollar after registering modest losses in the previous session, trading around 1.3650 during the Asian hours on Wednesday. The pair could extend losses as the Pound Sterling faces pressure from rising political risks in the UK and growing expectations of near-term Bank of England rate cuts.

Gold sticks to gains near $5,050 as focus shifts to US NFP

Gold holds moderate gains near the $5,050 level in the European session on Wednesday, reversing a part of the previous day's modest losses amid dovish US Federal Reserve-inspired US Dollar weakness. This, in turn, is seen as a key factor acting as a tailwind for the non-yielding yellow metal ahead of the critical US NFP release.

US Nonfarm Payrolls expected to show modest job gains in January

The United States Bureau of Labor Statistics will release the delayed Nonfarm Payrolls data for January on Wednesday at 13:30 GMT. Investors expect NFP to rise by 70K following the 50K increase recorded in December.

S&P 500 at 7,000 is a valuation test, not a liquidity problem

The rebound from last week’s drawdown never quite shook the sense that it was being supported by borrowed conviction. The S&P 500 once again tested near the 7,000 level (6,986 as the high watermark) and failed, despite a macro backdrop that would normally be interpreted as supportive of risk.

BNB prolonged correction signals deeper bearish momentum

BNB (BNB), formerly known as Binance Coin, is trading below $618 on Wednesday, marking the sixth consecutive day of correction since the weekend. The bearish price action is further supported by rising short bets alongside negative funding rates in the derivatives market.