U.S. Dollar (DXY) Stays Strong At The Start Of The Week

There are no economic reports scheduled to be released in the U.S. today, so traders will stay focused on the dynamics of demand for safe-haven assets.

Currently, the U.S. Dollar Index is trying to settle above the resistance level at 113.20. In case this attempt is successful, it will move towards the next resistance level, which is located at 113.80.

EUR/USD Attempts To Settle Below 0.9700

EUR/USD is testing the 0.9700 level as traders remain worried about the health of the European economy.

In Europe, government bond yields are gaining ground as bond traders believe that the severe energy crisis will push inflation to new highs and force the ECB to raise rates aggressively.

It remains to be seen whether the ECB will be able to break the current trend in the bond markets, which may develop into a real debt crisis for the bloc’s weakest members.

GBP/USD Remains Under Pressure

GBP/USD is currently trying to settle below the 1.1050 level as UK government bond yields move closer to multi-year highs.

The recent attempts of the BoE to stabilize the situation failed to provide sustainable support to UK government bond markets.

In case the current sell-off in the UK bond markets turns into a real panic, GBP/USD will find itself under more pressure.

Commodity-Related Currencies Decline As Commodity Markets Pull Back

The pullback in commodity markets put pressure on commodity-related currencies.

AUD/USD tested new lows near 0.6290, while NZD/USD settled below the 0.5600 level. Meanwhile, USD/CAD continued its attempts to settle above the 1.3750 level.

It should be noted that AUD/USD gained additional downside momentum after the release of Ai Group Services Index report, which indicated that Services Index declined from 53.3 in August to 48 in September, compared to analyst forecast of 52.9. Numbers below 50 show contraction.

USD/JPY Tries To Settle Above 145.50

USD/JPY settled above the 145 level and is trying to settle above 145.50 as the U.S. dollar continues to gain ground against a broad basket of currencies.

There are no signs of interventions from the BoJ, and USD/JPY has a decent chance to gain additional upside momentum. A move above the yearly highs at 145.90 will signal that the BoJ decided not to intervene in the 145 – 146 range.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Vladimir Zernovauthor

Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.

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