Forex Today: US Consumer Confidence next on tap amid geopolitical optimism

Pablo Piovano FXStreet

The Greenback has started the week on the back foot, receding to two-week lows on the back of the generalised improvement in the risk complex, all in response to rising optimism on a potential US-Iran deal.

Here is what you need to know on Tuesday, May 26:

The USD Index (DXY) dropped to two-week troughs after breaking below the 99.00 support, always following the better tone in the risk-linked space. The Conference Board’s Consumer Confidence gauge will be the salient event on the US docket, seconded by the Chicago Fed National Activity Index, the FHFA’s House Price Index and the S&P/Case-Shiller Home Price Index.

EUR/USD improved markedly, advancing to multi-day highs and revisiting the 1.1650 zone amid the widespread selling bias hurting the US Dollar. There will be no data releases in either Germany or the Eurozone.

GBP/USD reversed two daily pullbacks in a row and surpassed the 1.3500 hurdle against the backdrop of the broad-based risk-on sentiment. The BRC Shop Price Inflation is due alongside the CBI Distributive Trades.

USD/JPY seems to have embarked on a consolidative move in the upper end of its range near the 159.00 neighbourhood, setting aside at the same time two consecutive daily declines. The final prints of the Coincident and Leading Economic indices will be on top of the agenda in the 'Land of the Rising Sun'.

AUD/USD rose sharply and flirted with multi-day peaks near 0.7180, resuming the uptrend after two straight daily pullbacks. Next on the Australian calendar will be the key inflation figures on May 27.

WTI prices retreated sharply and approached their lowest level in the last three weeks, near the $90.00 mark per barrel, as traders assessed the likelihood of a reopening of the Strait of Hormuz any time soon.

The strong retracement in the Greenback lent support to Gold, pushing the troy ounce closer to the $4,600 yardstick. The mixed tone from US Treasury yields across the curve also bolstered the yellow metal’s recovery.

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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