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Dollar gains on Fed taper talk; Gold pulled back from 1730 level

August 11, 2021

EUR/USD: The EUR/USD pair kept declining yesterday and touched its lowest level since late March after being in the negative zone for the sixth day in a row. The market movements subsided in the late American session on Tuesday, and the pair seems to have gone into a consolidation phase. Earlier in the day, the disappointing sentiment data from the euro area supported the sellers. The US dollar remains strong, so the EUR/USD remains bearish. Cayman indicator showed mixed dynamic, after printing 90% of buyers at the beginning of the week. The Consumer Price Index data from Germany and the US will be closely watched today. Investors expect the annual CPI to edge lower in July. A reading close to the market consensus will probably help the USD maintain its bullish dynamic amid Fed tapering expectations.

SELL STOP 1.1670/TP 1.1530/SL 1.1720


USD/JPY: USD/JPY kept rising at the start of the Asian trading session. The strong bullish impulse in the US dollar has been keeping JPY buyers pressured since the middle of the last week. In the latest development, US Senate passed the massive $1 trillion infrastructure plan, adding to the optimism surrounding the US dollar. The number of Americans who filed new claims for unemployment benefits declined in July as expected, while the US reported the largest trade deficit on record in June. On the other hand, the Japanese yen stayed weaker against the dollar due to the increase in new coronavirus cases, which exceeded 10K for the first time.

Meanwhile, Japan’s bank lending edged higher in July at the slowest annual pace in the last nine years. Now, investors are waiting for the US Core Inflation Rate and Inflation Rate to come out, which will help them assess the market sentiment.

BUY 110.65/TP 111.65/SL 110.30


Gold: Gold market doesn’t show reversal in its previous downside which started at the beginning of the week. The US dollar’s massive gains and the action in the bond market have a negative impact on the precious metal. Gold prices are still extra sensitive to the central bank’s announcement and economic indicators. The precious metal has been pressured by a heavily bid US dollar which recently touched its highest level in more than four months against its main competitor which is the euro as investors speculated further over Federal Reserve’s next move.

SELL STOP 1715.00/TP 1700.00/SL 1720.00