Forex Today: Markets turn choppy ahead of key events

Eren Sengezer FXStreet

Here is what you need to know on Wednesday, August 24:

After having snapped a four-day winning streak on disappointing data releases on Tuesday, the US Dollar Index (DXY) started to edge higher in the early European morning on Wednesday. In the absence of high-tier data releases, the market action turns choppy with investors remaining cautious ahead of the Jackson Hole Symposium later this week. In the second half of the day, July Pending Home Sales and Durable Goods Orders data will be featured in the US economic docket. Meanwhile, US stock index futures post modest losses and the 10-year US Treasury bond yield continues to fluctuate above 3%.

On Tuesday, the data from the US revealed that the business activity in the private sector continued to contract in August with the S&P Global Composite PMI dropping to 45 from 47.7 in July. Other data showed that New Home Sales declined by 12.6% in July following June's contraction of 7.1%. The dollar lost interest after these data and the DXY lost nearly 0.5% on a daily basis. Nevertheless, the CME Group FedWatch Tool shows that markets are still pricing in a 51.5% probability of a 75 basis points rate hike in September.

Several news outlets reported on Tuesday that OPEC+ may lean towards oil output cuts when and if Iranian production returns depending on the revival of the nuclear deal. Crude oil prices continued to push higher and the barrel of West Texas Intermediate gained 3.5% before settling near $94.00.

EUR/USD staged a rebound and tried to reclaim parity after having dropped to its weakest level in nearly 20 years at around 0.9900 on Tuesday. The pair, however, failed to gather bullish momentum and retreated toward 0.9950 early Wednesday.

GBP/USD gained more than 50 pips on Tuesday and went into a consolidation phase above 1.1800 during the Asian trading hours on Wednesday. The pair trades in a relatively tight channel so far on the day.

USD/JPY fell sharply during the American session on Tuesday but the rebound witnessed in the 10-year US Treasury bond yield helped it erase a large portion of its daily losses. The pair moves sideways above 136.50 on Wednesday.

Gold capitalized on the broad-based selling pressure surrounding the greenback and registered daily gains for the first time since August 12. XAU/USD is struggling to find direction as it moves up and down in a narrow channel below $1,750.

Bitcoin is having a difficult time making a decisive move in either direction and is trading near the mid-$21,000s. Ethereum registered modest daily gains on Tuesday but it's already down more than 1% on the day near $1,600 early Wednesday.

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.

GBP/USD nudges higher above 1.3350 despite Middle East turmoil

The GBP/USD pair rebounds to near 1.3385 during the Asian trading hours on Thursday. However, the potential upside for the major pair might be limited amid cooler-than-expected UK inflation data and escalating tensions in the Middle East. Traders will take more cues from the UK Retail Sales report, which is due later on Friday.

EUR/USD advances ahead of ECB policy decision

EUR/USD extends its gains for the second consecutive day, trading around 1.1410 during the Asian hours on Thursday. The pair gains ground as the Euro finds solid support ahead of the European Central Bank's upcoming interest rate decision.

Gold holds above $4,100 as weak USD counters Fed hike bets amid US-Iran escalation

Gold holds above the $4,100 mark during the Asian session, and seems to have stalled the previous day's modest pullback from an over two-week high. Crude oil prices climb to a fresh high since June 11 amid a further escalation of tensions between the US and Iran, fueling inflation fears and bolstering US Federal Reserve interest rate hike expectations. This lifts US Treasury bond yields to a multi-month high and is seen as a key factor acting as a headwind for the non-yielding bullion.

Hyperliquid, Robinhood could lead crypto’s next bull market as DeFi and TradFi converge

The next crypto bull market could be driven by the growing convergence between blockchain-based financial infrastructure and traditional finance, according to Bitwise CIO Matt Hougan. In a report published late Tuesday, Hougan argued that crypto may be showing early signs of a market bottom, with Bitcoin gaining 9% since July 1 even as the NASDAQ 100 declined 6%.

Ripple and Stellar await direction amid cautious sentiment

Ripple and Stellar trade cautiously as both tokens hover around key technical levels. XRP is testing resistance at its 50-day EMA, while XLM continues to consolidate around the $0.187 support zone. Meanwhile, mixed derivatives data with a slight bearish tilt suggests traders remain cautious, keeping the next directional move uncertain.

US Dollar mid-year outlook: Exceptional currency, exceptional risks?

The US Dollar enters the second half of 2026 in a markedly different position from a year ago. The King currency has recovered, reflecting persistent US inflation, changing expectations for Fed policy, geopolitical tensions and renewed demand for defensive assets.