Forex Today: Dollar gains traction on rising US T-bond yields

Eren Sengezer FXStreet

Here is what you need to know on Tuesday, February 8:

The benchmark 10-year US Treasury bond yield continues its march toward the key 2% mark early Tuesday, helping the greenback preserve strength against its major rivals. December Trade Balance, NIFB Business Optimism Index and the IBD/TIPP Economic Optimism Index data will be featured in the US economic docket in the second half of the day. Meanwhile, US stocks futures are trading in the negative territory after posting modest losses on Monday.

Crude oil prices seem to have gone into a consolidation phase following last week's upsurge. The barrel of West Texas Intermediate (WTI), which touched its highest level since September 2014 at $93.13 on Friday, was last seen trading flat on the day near $91.50. Talks on bringing back the 2015 Iran nuclear deal is set to continue in Vienna on Tuesday.

WTI Crude Oil bulls accumulating energy for a new surge, levels to watch.

EUR/USD is edging lower toward 1.1400 on renewed dollar strength and European Central Bank President Christine Lagarde's comments. While speaking before the EU Parliament, Lagarde said that there were no signs of inflation measurably exceeding the 2% target in the medium term. "We need more than ever to maintain flexibility and optionality in the conduct of monetary policy," Lagarde repeated.

GBP/USD closed flat after testing 1.3500 on Monday and continues to trade in a very narrow range on Tuesday.

USD/JPY is trading at its highest level in more than a week at 115.50, supported by rising US T-bond yields.

Gold advanced to its strongest level in 10 days above $1,820 on Monday. XAU/USD is having a tough time gathering bullish momentum early Tuesday.

AUD/USD stays quiet above 0.7100 after rising decisively on Monday. During the Asian trading hours, the data published by the National Australia Bank showed that Business Confidence Index improved to 3 in January from -12 in December.

Bitcoin keeps its footing after breaking above $40,000 and was last seen rising more than 2% on a daily basis at $44,750. Ethereum is trading at its highest level since January to at $3,180, rising more than 1% on the day.

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

EUR/USD meets initial support around 1.1800

EUR/USD remains on the back foot, although it has managed to reverse the initial strong pullback toward the 1.1800 region and regain some balance, hovering around the 1.1850 zone as the NA session draws to a close on Tuesday. Moving forward, market participants will now shift their attention to the release of the FOMC Minutes and US hard data on Wednesday.

GBP/USD bounces off lows, retargets 1.3550

After bottoming out just below the 1.3500 yardstick, GBP/USD now gathers some fresh bids and advances to the 1.3530-1.3540 band in the latter part of Tuesday’s session. Cable’s recovery comes as the Greenback surrenders part of its advance, although it keeps the bullish bias well in place for the day.

Gold remains offered below $5,000

Gold stays on the defensive on Tuesday, receding to the sub-$5,000 region per troy ounce on the back of the persistent move higher in the Greenback. The precious metal’s decline is also underpinned by the modest uptick in US Treasury yields across the spectrum.

Ethereum Price Forecast: BitMine extends ETH buying streak, says long-term outlook remains positive

Ethereum (ETH) treasury firm BitMine Immersion continued its weekly purchase of the top altcoin last week after acquiring 45,759 ETH.

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.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.