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21.08.2023 Market Report


EUR/USD is posting small gains in Monday’s European morning, having stalled its recovery under 1.0900. The upside seems capped in the wake of renewed safe-haven demand for the US Dollar. Traders now look forward to the Buba monthly report for a fresh impetus.


GBP/USD attracts some buyers on the first day of a new week, sticking to its modest gains, below mid-1.2700s. The pair remains confined in familiar trading, as the mixed fundamental backdrop warrants caution ahead of the Fed’s Jackson Hole Symposium due later this week. 


The USD/JPY pair remains on the defensive for the third straight day on Monday, albeit manages to hold its neck above the 145.00 psychological mark through the Asian session.

Speculations that Japanese authorities might intervene in the foreign exchange market to prop up the domestic currency, along with looming recession risks, continue to lend some support to the safe-haven Japanese Yen (JPY). This, along with subdued US Dollar (USD) price action, is seen as a key factor acting as a headwind for the USD/JPY pair. The downside, however, seems limited, at least for the time being, as traders seem reluctant to place aggressive bets and prefer to wait for fresh cues about the Federal Reserve’s (Fed) future rate hike path.


The AUD/USD pair extends its sideways consolidative price action for the second successive day on Monday and seesaws between tepid gains/minor losses, around the 0.6400 mark through the Asian session. Spot prices, meanwhile, react little to the People’s Bank of China (PBoC) rate cut and remain well within the striking distance of the lowest level since November 2022 touched last week.


NZD/USD bears keep the reins despite showing resilience around 0.5920 heading into Monday’s European session. In doing so, the Kiwi pair drops for the tenth consecutive day amid the cautious mood ahead of this week’s top-tier data/events.


The USD/CAD pair trades sideways above the 1.3500 mark after reaching the highest level since May during the early Asian session on Monday. The pair currently trades near 1.3542, losing 0.08% on the day. Meanwhile, a decline in oil prices undermines the Canadian Dollar since Canada is the largest oil exporter to the United States.


USD/CHF lacks clear momentum around 0.8820, after refreshing a six-week high to 0.8828 heading into Monday’s European session. In doing so, the Swiss Franc (CHF) pair portrays the market’s indecision ahead of the top-tier data/events.


Oil prices rose on Monday as global supply is tightening with lower exports from Saudi Arabia and Russia, offsetting nagging concerns about global demand growth amid high interest rates.


Gold price struggles to gain ground and holds below $1,900 in the Asian session on Monday. The upbeat US economic data boost the Greenback broadly, which exerts some selling pressure on XAU/USD. Meanwhile, the US Dollar Index (DXY), consolidates its gains around 103.35.

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