At the start of a week full of US earnings, important economic data and a couple of central bank meetings, risk is somewhat off the menu. Equities, copper and, to a lesser degree, oil prices were all trading lower at the time of this writing.
The USDJPY pair initially rallied during the course of the session on Friday, but turned around to form a bit of a shooting star.
AUDUSD moved sideways in a range between 0.7441 and 0.7755.
The rally for copper finally came to an abrupt halt yesterday as weak economic trade data news from China dealt the base metal a mortal blow, sending it plunging lower and closing the session with the wide spread down candle on very high volume, and signalling the end to the rally of September.
EURUSD recently broke below its descending triangle support at 1.1130 and has dipped to a low of 1.0988 before showing signs of a pullback. Applying the Fib tool on the latest swing high and low shows that the 61.8% Fibonacci retracement level lines up with the broken support, which might now hold as resistance.
In recent days we have seen the dollar’s bullish trend gain momentum against the G10 currencies. Investors appear to be expanding their bullish bets on the greenback amid rising expectations that Donald Trump’s reputation will prevent him to become the next US president.
As we highlighted the possibility on Monday, gold took a big plunge below the psychologically-important and support level of $1300 per ounce yesterday. The breakdown triggered further follow-up technical selling, causing gold to fall for a time below $1270 per ounce.
The dollar has staged a broad-based rally today, which caused the GBP/USD to tumble to a new 31-year low and the EUR/USD momentarily dipped below its 200-day moving average once again.
The metronomic price action for gold is continuing to play out once again on the daily chart, with the rally of late September starting to wane once again, as the precious metal descends once more to test the all important technical support area in the $1308 per ounce region in early trading.
The AUDUSD pair broke higher during the course of the session on Monday, but gave back more than half of the gains from the early part of the session.
