Last week saw the USD continue to slide lower after market participants were reminded of the FED’s dovish stance at their most recent FOMC Conference. The DXY broke 90.00 as the greenback weakened across all major assets and EUR/USD broke above 1.2250.
Cryptoassets took centre stage as BTC/USD broke to new all-time highs and finished the week up over 22%. The surge was also seen across the altcoins as ETHUSD broke above the $650 mark. Going into the week ahead; dollar strength has returned amidst fears of a new Covid-19 strain that has been sighted across the UK and as a result led to tighter restrictions on movement and travel.
Sterling broke lower to start the week as a new Covid-19 strain urged PM Johnson to enforce a new tier level of restrictions across the south east of England which is to also include the city of London. The nation experienced another record level of cases amidst what has been said to be a strain up to 70% more transmissible than the former. Sterling led the losses in Monday’s trade as Cable slumped to lows around 1.3200 during the session. Weakness for the currency was also pressured by the lack in progress over talks with the EU. Fisheries continue to remain the bone of contention for both sides as the deadline looms. Going into the week ahead, market participants will be looking to analyse the sentiment and rhetoric of the two sides as the UK also face travel bans from a number of neighbouring countries.
WTI crude and Brent finished last week with its seventh week of consecutive gains as the commodities continued to rise as the greenback broke lower. Going into the week ahead both WTI and Brent are lower as a new Covid-19 strain and travel bans between nations in Europe and the UK threaten demand. At the time of writing WTI current sits at $50.32/bbl. after breaking beneath its 8 DEMA earlier on in the session. The selloff is a constant reminder that at present; Oil prices are very much linked to the outlook of the pandemic.
The week ahead is set to be quiet in terms of economic data with no high impact data set to be released.
Here is a breakdown of the medium impact data releases this week.
13:30 Final GDP q/q. Markets to watch: USD Crosses
Wednesday 13:30 GDP m/m. Markets to watch: CAD Crosses Showcase your skill as a trader, earn a Funded Trading Account – Click here to start your 7 day free trial