EUR/USD Price and Gold Fall as US Dollar Reverses Higher

EUR/USD Price and Gold Fall as US Dollar Reverses Higher

Investors take a step backward as the US possible lockdown overweighs Vaccine’s optimism.

Weaker Risk-on Sentiment

Global stock markets retreated further on Wednesday on markets fear from the likely shut down in the US as COVID-19 cases continue its upward trend. Investors ignored Pfizer update about even 95% success rate of the coronavirus vaccine’s trials and cut back some of their long positions on major US indices.

Markets know that Pfizer’s and Moderna’s vaccines need time to get the necessary approval from health regulators and there are some logistical issues when it comes to distributing the vaccine. Putting that aside, even with rolling out the vaccine restriction measures will continue until a decent level of immunity of the virus is available.

Based on the above and the lack of a new fiscal stimulus package and the unlikelihood of passing it in Congress until after the new administration takes over the market closed in the red yesterday.

Stock Market

Change %

S&P 500

-1.3 %

Dow Jones

-1.2%

NASDQ

-0.8%

Japan 225

-0.9%

DAX 30

-0.3%

FTSE 100

-0.6%

CAC 40

-0.4%

EUR/USD and Main FX Markets

The greenback reversed higher on weaker risk-on sentiment in the market. That said, the US Dollar index outlook remains neutral while above September 1 low at 91.72.

The EUR/USD failed to rally above 1.1909 then pointed lower eyeing a test of the low end of the current trading zone 1.1620 – 1.1909.

The GBP/USD rebounded around 1.3300 and fell for a test of 1.3184. A close below that level could change the pair’s outlook to neutral.

Gold and Oil

The oil traders are considering the surging coronavirus cases that may force more countries to shut down some parts of their economies and consequently reduce oil demand but also take into account the possibility of OPEC+ to extend output cuts in the Q1 of 2021 to maintain price stability. Therefore, the Brent Crude failed on multiple occasions to overtake $44.50 indicating that the upward trend is losing momentum.

The Gold has tested today the $1,861 then rallied, a close below that level will change the precious metal outlook to negative and may encourage bears to press towards $1,796/oz.

Looking Ahead

Investors will follow the US jobless claims numbers with the Fed Mester’s speech at 2:30 PM (GMT) then the US home sales numbers at 4:00 PM and Fed Mester’s speech at 6:35 PM.

Le informazioni contenute nel presente documento sono redatte da Mahmoud Alkudsi e non costituiscono né devono essere interpretate come suggerimenti di investimento. Le informazioni di cui al presente documento costituiscono comunicazioni di marketing generali a scopo informativo e, in quanto tali, non sono state preparate nel rispetto dei requisiti di legge che promuovono le ricerche di investimento indipendenti. Inoltre, non sono soggette ad alcuna limitazione sulle transazioni condotte in anticipo rispetto alla divulgazione delle ricerche di investimento in questione.

Gli utenti / lettori non dovrebbero fare affidamento esclusivamente sulle informazioni qui presentate e dovrebbero fare le proprie ricerche / analisi anche leggendo la ricerca reale sottostante.

Key Way Investments Ltd non influenza né ha alcun input nella formulazione delle informazioni qui contenute. Il contenuto è generico e non tiene conto di circostanze personali individuali, esperienza di investimento o situazione finanziaria attuale.

Pertanto, Key Way Investments Ltd non accetta alcuna responsabilità per eventuali perdite di trader a causa dell'uso e del contenuto delle informazioni presentate nel presente documento. Le performance passate non sono un indicatore affidabile dei risultati futuri.