You'll be pleasantly surprised with what you find on the other side of fear.
USD
EUR/USD
The single currency hovered above $1.1300 as Federal Reserve Chairman Powell reiterated yesterday his inflation fears but advocated that inflation will come down “meaningfully” in the second half of 2022.
GBP/USD
The British pound steadied above $1.3288 despite mounting doubts on whether the Bank of England will raise interest rates at a policy meeting this month.
USD/JPY
The Japanese yen climbed to 112.66 last night before timing some gains to 113.08 as Cleveland Fed President Loretta Mester made some hawkish comments on speeding up the taper and likely rates in the next year.
USD/CAD
The Canadian dollar weakened to 1.2811 against its U.S. counterpart on Wednesday, giving back its earlier gains as a rebound in oil petered out and investor appetite for risk remained fragile.
AUD/USD
Aussie plummeted below $0.71, on mixed domestic Australia Trade Balance as exports improve in October but imports contract further.
USD/ZAR
The South African rand tumbled from 15.73 to 16.01 although South African manufacturing activity expanded at a faster pace in November on positive business activity and new sales orders.
USD/MUR
The local pair stayed unchanged at 43.42(selling) on the Mauritian market.
17:30 - USD - Initial Jobless Claims
The dollar Index extends its intense rebound near the 94.00 threshold, clinching a new high for this year 2021 amid an earlier rate hike expectation and announcement of a nearing tapering asset purchase which clearly impacted the yield curves.
A tightening of monetary policy by the European Central Bank remains far in the future but ECB remains vigilant on its inflation figures yet to be released this Friday. This could give additional upward momentum on the USD in the near term and exerts additional selling pressure on the euro and the pound.
On the technical side, after a breach and close above the 100% retracement A-B-C (93.72 level) ,the greenback could easily approach the 113% level at 94.38 followed by 127% level – 94.98 level in the near term. Resistance at 96.47 (161.8%) remains key level to watch
1.3750 marked the completion of ‘wave e’ of the triangular retracement (wave B) of corrective move A-B-C for GBPUSD and abruptly, we saw fresh sellers entering the market below the 1.3600 levels yesterday.
As per Elliott wave principle, GBPUSD is battling around 1.3515 levels and higher inflation, Brexit and Petroleum concerns could exert further pressure on the pound towards 1.32 levels towards completion of wave C.
A breach and close above 1.3750 nullify this downward pattern.
