Market Update - 21 December 2022

EUR/USD extends its sideways consolidative price action and remains confined in a range. The Fed’s hawkish outlook, rising US bond yields underpin the USD and act as a headwind. The risk-on impulse caps gains for the safe-haven buck and lends some support to the pair. (FXStreet)

GBP/USD lacks any firm intraday directional bias and remains confined in a narrow trading band. The Fed’s hawkish outlook, rising US bond yields revive the USD demand and act as a headwind. The fundamental backdrop favours bearish traders and supports prospects for a further decline. (FXStreet)

US Dollar Index grinds lower after bouncing off weekly bottomDXY struggles as United States Treasury bond yields stay firmer but yield curve inversion recedes. US Conference Board Consumer Confidence eyed for intraday directions ahead of Federal Reserve’s preferred inflation. US Dollar’s gauge bounces off one-week-old support but bear cross keeps sellers hopeful. US Dollar Index (DXY) licks its wounds around 104.10 during early Thursday. (FXStreet)

EUR/JPY prints mild gains around the lowest levels in three months. 200-DMA probes bears but downbeat oscillators, key support break signal further downside. Early December swing low guards immediate recovery moves. (FXStreet)

USD/JPY picks up bids after falling the most since October 1998. Oversold RSI backs recovery moves bearish MACD signals 50% Fibonacci retracement challenges bulls. Previous support lines, key SMAs are additional upside hurdles to cross for the bulls before taking control. August month’s low, golden Fibonacci ratio eyed during fresh downside. (FXStreet)

USD/INR stays mildly bid, struggles for clear directions amid mixed clues. Markets pare BOJ-led moves but the corrective bounce lack momentum. US Dollar recovers ahead of CB Consumer Confidence, Oil cheers hopes of more stimulus. (FXStreet)

USD/CHF remains mildly bid as buyers struggle to retake control after two-day absence. Descending trend line from Monday restricts guards immediate recovery ahead of 100, 50 HMAs. Firmer oscillators suggest further recovery moves, 0.9330 is the key hurdle. (FXStreet)

AUD/USD gains some positive traction on Wednesday, albeit lacks follow-through. The risk-on impulse benefits the Aussie; a modest USD strength caps the upside. The fundamental backdrop supports prospects for a further depreciating move. (FXStreet)

WTI crude oil picks up bids to portray three-day uptrend. US Dollar bears the burden of BOJ-inflicted bond selling. Surprise fall in API inventories, upbeat headlines from China, Japan adds strength to the recovery moves. Weekly EIA oil stockpiles, US CB Consumer Confidence eyed for fresh impulse. (FXStreet)

Gold price is reversing slightly from one-week highs of $1,821 reached on Tuesday. XAU/USD needs a ‘Santa rally’ to extend the upside toward $1,830, FXStreet’s Dhwani Mehta reports. (FXStreet)

Silver retreats from a fresh eight-month high touched earlier this Wednesday. The technical setup supports prospects for the emergence of some dip-buying. A break below the $23.00 confluence is needed to negate the positive outlook. (FXStreet)

Source: FXStreet, DailyFX

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