Author: Mr. Shah – Technical Analyst
The U.S. dollar traded stronger in the Asian session driven by 10-year U.S. bond yields that soared to a two-year high following market optimism for an interest rate hike by the Federal Reserve (Fed).
The benchmark 10-year bond yield rose to 1.88%, the highest level it has ever touched since January 2020 while the 2-year yield jumped above 1% for the first time since February 2020.
This increase indirectly gives an indication of increased investor confidence in tightening policy.
The first FOMC meeting for the year will take place next week and this is certainly the most awaited by investors to get an indication of when and how much the Fed will raise rates.
EURUSD EUR/USD seesaws around 1.1320-25 during early Wednesday morning in Asia, having dropped the most compared to the past 12 days.
GBPUSD Bulls will be looking for a break 1.3690 into fresh highs on the daily chart.
AUDUSD is bouncing back towards 0.7200, as the US Treasury yields pull back slightly from two-year highs amid broad risk aversion.
GOLD prices keep the bounce-off weekly low at around $1,815, up 0.05% intraday during Wednesday’s Asian session.