August 13, 2021

This Trader Needs To Digest To Trade USD At The Weekend

 Still a concern of investors, the contagion of the Covid-19 variant Delta which remains risky has increased restrictive regulations for the technology sector in China weighed on market sentiment over the weekend.

While Wall Street markets saw gains on key indices, Asian stock markets traded mixed making investors wary of risky market sentiment.

Investors' attention also shifted to the issue of policy tightening by the Federal Reserve (Fed) through measures to reduce bond purchases after the US producer price index data published yesterday gave a good picture of inflation.

The strengthening US dollar has put pressure on high -yielding currencies such as the Australian dollar and the New Zealand dollar. Still, with expectations for the US dollar likely to move weaker again gives the risk of a change in price direction.

The currency also came under pressure by the US dollar heading into weekend trading. The Euro is seen to be more successful in absorbing pressure than the Pound which continued to lose to its latest lows this week.

Investors saw risks to the struggling UK economy in the face of the Covid-19 contagion in addition to the pressure of Brexit uncertainty.

US consumer confidence sentiment, which will be the focus of tonight's New York session, is also expected to affect the movement of the US dollar before closing the trading curtain this week.