US dollar steady and more mixed across the board, commodity currencies lead on risk recovery
It was a calmer session in Europe today as broader market sentiment shows some tentative signs of recovery. Key word there being tentative of course. That after a rough few days for risk trades especially, amid a painful combination of selling in precious metals, tech stocks, and cryptocurrencies.
Today, all three are showing a modest bounce but not without some early drama in early Asia trading before this.
Silver got trounced once again in falling over 13% to near $64 before recovering to be up 4% now just above the $74 level. Gold was less volatile as it fell to a low of $4,655 before bouncing back over 2% now to $4,882 on the day.
The dramatic bounce highlights that the volatility spikes are still very much in play but reaffirms a continued healthy correction for precious metals. Of note, the rebound in silver comes as dip buyers stepped in with price having moved within touching distance of the 100-day moving average – a key technical level on the charts.
Overall risk sentiment also caught a modest rebound with S&P 500 futures now seen up 0.5%. At the lows earlier, futures were down 1% as tech shares stayed under pressure. Amazon’s earnings backlash did not help with shares still down 8% in pre-market, but at least there’s a broader recovery elsewhere.
The mood music is helped by a rebound in Bitcoin after the cryptocurrency came within a whisker of testing the $60,000 mark. That saw bids come in with Bitcoin now rising back up above $66,000 to stabilise a little after a very poor week.
In other markets, things were less dramatic with the dollar holding steadier and slightly softer at the balance against the rest of the major currencies. EUR/USD keeps just below the 1.1800 level amid large option expiries and some ECB commentary on the exchange rate.
Meanwhile, USD/JPY is flat holding just above the 157.00 level while commodity currencies lead gains with AUD/USD up 0.8% to 0.6980 levels on the day.
Besides that, oil prices also continues to be in focus in awaiting US-Iran talks in Oman. For now, the mood is tense but oil is still set for a weekly drop with price at $63.16 currently.
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