Forex Today: Risk-off backs the greenback

Valeria Bednarik FXStreet

What you need to know on Tuesday, October 12:

The week kick-started in slow motion with market participants looking for fresh catalysts. Generally speaking, concerns persisted as worrisome headlines came from China putting a cap to Friday stocks’ rally. Once again, Evergrande skipped a foreign dividend payment, while another local giant, developer Sinic Holdings, said it would likely default on its 2021 bonds, as it does not have enough financial resources to the make payments by their maturity date.

Wall Street seesawed between gains and losses, ending the day in the red. Earnings season kicked in with big banks reporting this week. The US bond market was closed, as the US celebrated Columbus Day.

The American dollar benefited from risk-off at the end of the day, although the AUD/USD pair retained its early gains, as higher copper prices underpinned the aussie. USD/CAD ended the day unchanged at around 1.2480, while the best performer was USD/JPY up to 113.40, its highest since 2018.

The EUR/USD pair ended the day with modest losses in the 1.1550 price zone, while GBP/USD finished the day just below the 1.3600 threshold.

Oil prices kept rallying to multi-year highs, with WTI settling at $ 80.50 a barrel. Gold ticked lower, closing the day at $1,754 a troy ounce.

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: XRP to outperform BTC and ETH

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

EUR/USD trims gains, hovers around 1.1900 post-US data

EUR/USD trades slightly on the back foot around the 1.1900 region in a context dominated by the resurgence of some buying interest around the US Dollar on turnaround Tuesday. Looking at the US docket, Retail Sales disappointed expectations in December, while the ADP 4-Week Average came in at 6.5K.

GBP/USD comes under pressure near 1.3680

The better tone in the Greenback hurts the risk-linked complex on Tuesday, prompting GBP/USD to set aside two consecutive days of gains and trade slightly on the defensive below the 1.3700 mark. Investors, in the meantime, keep their attention on key UK data due later in the week.

Gold loses some traction, still above $5,000

Gold faces some selling pressure on Tuesday, surrendering part of its recent two-day advance although managing to keep the trade above the $5,000 mark per troy ounce. The daily pullback in the precious metal comes in response to the modest rebound in the US Dollar, while declining US Treasury yields across the curve seem to limit the downside.

XRP holds $1.40 amid ETF inflows and stable derivatives market

Ripple trades under pressure, with immediate support at $1.40 holding at the time of writing on Tuesday. A recovery attempt from last week’s sell-off to $1.12 stalled at $1.54 on Friday, leading to limited price action between the current support and the resistance.

Dollar drops and stocks rally: The week of reckoning for US economic data

Following a sizeable move lower in US technology Stocks last week, we have witnessed a meaningful recovery unfold. The USD Index is in a concerning position; the monthly price continues to hold the south channel support.