July 21, 2021

Current Market Situation In Preparation Of Traders Ahead Of The NY Session

 Entering the European session, the US dollar continued to trade stronger amid still-risky market sentiment, squeezed by concerns over a surge in Covid-19 infection cases.

At the time of writing, the dollar index was slightly down at 93.00, but remained strong after touching its latest high since early April, at the start of the session around 93.18.

While the 10 -year US Treasury yield began to rise again to around 1.25%, rebounding from a five -month low of 1.13%.

Concerns over the very rapid spread of Delta virus variants around the world have led to a high increase in cases of infection, continue to support the greenback’s demand as a safe haven.

Meanwhile, at the start of the session, the euro fell to its latest three -month low reflecting investor concerns ahead of the European Central Bank's (ECB) policy meeting on Thursday, as well as being affected by the strengthening US dollar.

The pound, meanwhile, continued to trade gloomily after hitting a 5-and-a-half-month low, weighed down by the strength of the greenback dollar amid rising cases of Covid-19 infection in the UK.

Uncertainty in the Brexit drama also weighed on the pound, following an ongoing misunderstanding between the European Union (EU) and the UK over protocol issues in Northern Ireland.

On the other hand, the Aussie dollar also traded weaker after Australia reported a disappointing drop in retail sales data readings, coupled with reports of coronavirus cases continuing to rise in the country’s largest cities.