Forex Today: Focus shifts to PMI surveys following choppy start to the week


Share:

Here is what you need to know on Tuesday, January 24:

The US Dollar is having a difficult time shaking off the bearish pressure early Tuesday and the US Dollar Index stays in negative territory below 102.00. On Monday, the benchmark 10-year US Treasury bond yield recovered above 3.5% and helped the US Dollar stay resilient against its rivals despite the risk-positive market environment. US stock index futures trade flat in the early European morning as investors await S&P Global Manufacturing and Services PMI surveys for the Euro area, Germany, the UK and the US. The Richmond Fed Manufacturing Index for January will also be featured in the US economic docket later in the day and a 2-year US Treasury note auction will take place at around 1800 GMT.

With the Fed staying in the blackout period, Wall Street's main indexes registered strong gains on Monday as market participants remain optimistic about a policy pivot. According to the CME Group FedWatch Tool, markets are pricing a 62% probability that the Fed will stay on hold after raising the policy rate by 25 basis points in February and March.

After rallying to a fresh multi-month high above 1.0900 during the Asian trading hours on Monday, EUR/USD erased its gains in the second half of the day and closed virtually unchanged. Early Tuesday, the pair is stretching higher toward 1.0900. Mixed comments from European Central Bank officials on the policy outlook seem to be limiting the Euro's potential gains for the time being. While speaking at a conference on Monday, "we have made it clear that ECB interest rates will still have to rise significantly at a steady pace to reach levels that are sufficiently restrictive, and stay at those levels for as long as necessary," ECB President Christine Lagarde said.

GBP/USD registered small losses on Monday as the Pound Sterling struggled to outperform the US Dollar amid political jitters in the UK. Early Tuesday, the pair clings to modest daily gains at around 1.2400.

The data from Australia showed earlier in the day that the S&P Global Manufacturing and Services PMIs both arrived slightly below in January's flash estimate. Additionally, National Australia Bank's Business Conditions Index declined to 12 in December from 20, missing the market expectation of 19 by a wide margin. Despite the uninspiring data releases, AUD/USD trades in positive territory near 0.7050 and stays within a touching distance of the multi-month high it set at 0.7064 earlier in the month. In the early Asian session on Wednesday, Consumer Price Index data for the fourth quarter will be watched closely by investors.

USD/JPY gained nearly 100 pips on Monday but seems to have lost its bullish momentum on Tuesday. The pair was last seen losing more than 0.5% on the day at 129.85.

Gold price struggled to gather bullish momentum on Monday amid recovering US T-bond yields and closed the day flat. With the US Dollar staying under modest selling pressure and US yields holding relatively steady early Tuesday, XAU/USD regained its traction and was last seen trading at its highest level since mid-April at $1,940.

Bitcoin posted small gains on Monday and continued to stretch higher early Tuesday. At the time of press, BTC/USD was up nearly 1% on the day at $23,100. Ethereum continues to fluctuate in a tight range slightly above $1,600 after having struggled to make a decisive move in either direction on Monday.

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content

Editors’ Picks

EUR/USD loses traction, retreats below 1.0600

EUR/USD loses traction, retreats below 1.0600

EUR/USD lost its recovery momentum and declined below 1.0600 in the American session on Friday, erasing a portion of its daily gains in the process. Nevertheless, the risk-positive market atmosphere after PCE inflation data helps the pair limit its losses.

EUR/USD News

GBP/USD turns negative on the day below 1.2200

GBP/USD turns negative on the day below 1.2200

GBP/USD reversed its direction and slumped below 1.2200 in the American session on Friday after rising above 1.2270 earlier in the day. Position readjustments and profit-taking on the last trading day of the quarter seems to be weighing on Pound Sterling.

GBP/USD News

Gold reverses direction, drops below $1,860

Gold reverses direction, drops below $1,860

Following a steady rebound toward $1,880 on Friday, Gold price made a sharp U-turn and turned negative on the day near $1,860. Although the 10-year US T-bond yield is down more than 1%, XAU/USD struggles to find demand on the last day of Q3.

Gold News

Polkadot Price Forecast: DOT reversal seems inevitable after 92% correction from all-time high

Polkadot Price Forecast: DOT reversal seems inevitable after 92% correction from all-time high

Polkadot price, in nearly two years, has shed 92.91% from its all-time high of $55.09. The massive downswing in DOT has pushed it down to levels that were last seen in October 2020. Hence, the chances of this altcoin forming a bottom and rallying are high. 

Read more

Earnings beat triggers Nike to spike 9%

Earnings beat triggers Nike to spike 9%

Nike (NKE) stock has surged over 9% in Friday’s premarket, climbing above $98 per share, following late Thursday’s fiscal first-quarter earnings release. Nike beat pessimistic earnings expectations by more than 23% and hiked its dividend by 9%.

Read more

Forex MAJORS

Cryptocurrencies

Signatures