It a big day for the US dollar and the Dollar index sitting near to key support level of $93.50. The traders and investors remained cautious of FOMC interest rate decision and the Fed Chair Jerome Powell press conference. Fed is expected to hold its federal fund's rate steady and the key focus will be on the FED statement.
On Tuesday, Wall Street ended lower after some large US companies reported weaker-than-expected earnings including McDonald's (NYSE: MCD), VISA (NYSE: V), and eBay (NASDAQ: EBAY). While Pfizer (NYSE: PFE) shares closed 3% up after the company reported better-than-expected Q2 earnings.
Crude oil price trading higher on Wednesday supported by API data. The data showed in the US the crude inventories unexpectedly fell by 6.8 million barrels from previous 7.544 million.
The dollar index struggling to find the upside momentum ahead of FOMC decision. On Tuesday, the Index slightly recovered from the previous session losses but failed to break above 94 levels. At the writing, the pair trading below the previous support of 93.50. Meanwhile, the Australian dollar surged to a fresh year high of 0.7190 during the European session.
The gold price hovers near to the all-time high on Wednesday ahead of US central bank interest rate decision and statement.
On the data front, Spain retail sales rebounded to -4.7% in June from 18.9% slump in the previous month. While Consumer prices in Australia dropped by 0.3% in Q2 2020, slightly below the market expectation of a 0.4% fall and after a 2.2% rise in Q1.
Moving ahead today, the important events to watch:
US Pending home sales report – 14.00 GMT
US crude oil inventories– 14.30 GMT
US FOMC Interest rate decision – 18.00 GMT
US FOMC Press Conference – 18.30 GMT
The number of people infected with the coronavirus across the world surpassed 16.7 million, of which at least 660 thousand people have, according to data released by the Johns Hopkins University. The US accounted for the world's highest number of infections and fatalities at 4,287,974 and 148,009, respectively. The coronavirus pandemic "continues to accelerate," with a doubling of cases over the last six weeks, the World Health Organization chief said.
XAU/USD: Gold price climbed back to above $1950. On Tuesday, the yellow metal price dropped to near $1900 after surged to an all-time high of $1980.
The important levels to watch for today: Support- 1920 and 1900 Resistance- 1980 and 1995.
EUR/USD: The currency pair trading in a range between 1.1700 to 1.1770 ahead of FED meeting after the pair climbed to near 2-year high of 1.1780 on Monday.
The important levels to watch for today: Support- 1.1710 and 1.1670 Resistance- 1.1780 and 1.1810.
Quote of the day: Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected – George Soros.