Market Update - 21 Aug 2023

GBP/JPY attracts some buying on Monday, albeit struggles to capitalize on the move. Intervention fears, along with a softer risk tone, lend support to the JPY and cap gains. The BoJ-BoE policy divergence favours bulls and should continue to limit the downside. (FXStreet)

USD/CAD consolidates and seeks fresh impetus on monetary policies from both countries. BoC adjusted its forecast that a slowdown in inflation would take longer. Traders aim to gather more cues on the economic situation and inflation outlook. (FXStreet)

The index extends the corrective move to 103.30. US yields kicks off the week in a positive tone. Markets’ attention will be on the Jackson Hole event. The greenback extends the bearish note into the beginning of the new trading week and drags the USD Index (DXY) to the 103.30 zone. (FXStreet)

EUR/GBP gains momentum above the 0.8540 mark on Monday. The annual German Producer Price Index (PPI) for July fell to -6% versus of -5.1% expected. Markets anticipate that the Bank of England (BoW) will maintain a tightening cycle. Investors await Eurozone, UK S&P PMI data for fresh impetus. (FXStreet)

USD/JPY consolidates around the 145.15-145.65 region in a narrow trading band. The major pair stands above the 50- and 100-hour EMAs with an upward slope. The immediate resistance level appears at 145.85; he key contention level is seen at 144.90-145.00 region. (FXStreet)

EUR/USD recovers some lost ground near 1.0800 ahead of German economic data. The easing Eurozone inflation data alleviated pressure on the European Central Bank to continue rates hike. Investors raise their bets on more rate hikes by the Federal Reserve (Fed) despite the US upbeat data. Traders await the German PPI data, the highlight this week will be Fed Chairman Jerome Powell Speaks. (FXStreet)

EUR/JPY gains some positive traction on Monday, albeit lacks strong follow-through. Intevention fears, along with a softer risk tone, lend support to the JPY and cap gains. The BoJ-ECB po. (FXStreet)

USD/CHF remains idle at the highest level in six weeks. Bulls and bears struggle for clear directions amid light calendar, cautious mood. China-inspired optimism weigh on Swiss Franc prices but anxiety ahead of Jackson Hole event puts a floor under the price. China news, PMIs act as additional trading filters to watch for clear directions. (FXStreet)

AUD/USD kicks off the new week on a softer note and is pressured by a combination of factors. China’s economic woes continue to weigh on investors’ sentiment and the risk-sensitive Aussie. Bets for one more Fed rate hike in 2023 underpin the USD and contribute to a mildly softer tone. (FXStreet)

NZD/USD remains depressed at YTD low, down for 10 consecutive days. Kiwi portrays bearish consolidation within weekly pennant, 0.5910 becomes necessary for sellers fresh entry. Buyers remain off the table below fortnight-old resistance line. (FXStreet)

WTI crude oil prints three-day uptrend but lacks bullish bias of late. Clear upside break of short-term resistance line, firmer RSI (14) line allows Oil buyers to retake control. 10-DMA checks energy bulls amid bearish MACD signals and cautious mood ahead of Jackson Hole Symposium. PBoC announced rate cuts, China braces for more stimulus to defend economic recovery. (FXStreet)

Friday’s downtick in prices of natural gas was accompanied by increasing open interest and volume, exposing the likelihood of further retracement in the very near term. That said, the commodity’s downside still faces decent contention around the $2.50 region per MMBtu. (FXStreet)

Gold Price remains bearish at five-month low, lacks momentum of late. Sustained trading below $1,900 upside hurdle, China woes underpin bearish bias about XAU/USD. August PMIs, US Durable Goods Orders and Jackson Hole Symposium will be in the spotlight for clear directions. Central bankers’ hesitance to welcome policy pivot can drag Gold Price further towards the south. (FXStreet)

Silver attracts some buyers for the third successive day, though lacks bullish conviction. The intraday technical setup favours bulls and supports prospects for additional gains. A convincing break below the $22.70-65 confluence might negate the positive outlook. (FXStreet)

Source: FXStreet

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