Started by PocketOption, Jan 29, 2023, 03:03 pm
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The dollar fell 0.37% on Wednesday as investors shifted focus to US corporate earnings while waiting for US GDP data. Gold hit yet another 9-month high at $1950 on the dollar’s slide.
Following results from Microsoft showing slowing growth and softness in the consumer market, risk appetite decreased in a sign of aversion led by the tech sector. A series of disappointing corporate reports contributed to the worries of a pending recession, pending confirmation later today. Better earnings from Tesla and Levi Strauss towards the end of the session sent major indices back to the open for a somewhat volatile and mixed session on Wednesday. On the flip side, DXY is closer to fresh multi month lows than to the resistance of 102.00, with Gold able to keep its gains intact and remain at 9-month highs. $1966 is resistance below $1975.1900 a support.
The BOC hiked but did so dovishly as it only raised interest rates as expected by 25bps and indicated that a pause was the most likely outcome of the next meeting. The decision contributed to a drop in the CAD to $1.3430 against the USD, but the pair formed a thick doji candlestick at $1.3384 due to the dollar’s weakness. $1.3320 is major support.
While the consensus is that the BOE will hike soon, markets are also pricing in a cut towards the end of the year. On the other hand, UK’s PPI figures showed lessening price pressure, contributing to the hope that inflation had peaked. Cable had a decent session 0.50% higher but remained stubbornly below the peak of $1.2449, at the round $1.24. If bears step in, the pair could reverse its gains again, with first support yesterday’s open at $1.2333
Germany’s economy minister Robert Habeck warned that Germany would most likely have a technical recession. ECB member Joachim Nagel doubled down on the need to raise hikes further and supported more hikes after March. He was joined by similar comments from Ireland’s Gabriel Makhlouf and Slovenia’s Bostjan Vasle. Euro also advanced due to the greenback’s weakness, reaching a double top at $1.0925 and 0.28% higher in the session. $1.10 is next up, should an upward breakout incur.
Australia’s PM Albanese said there was increased institutional engagement with China. Chinese President Xi reportedly said that he wanted to deepen relations with Australia. The Aussie reached an August high above 71 cents on Wednesday and trades higher on Thursday morning due to optimism and following surging inflation figures.
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