The Bearish Price Action of the USD Is Helping Support Gold

The USDJPY appears to be resuming its downtrend.


The US Dollar was bearish against all of its major pairs on Monday. On the U.S. economic data front, Empire Manufacturing declined to 3.7 on month in August (15.0 expected), from 17.2 in July. 

On Tuesday, Housing Starts for July are expected to increase to 1,240K on month, from 1,186K in June.  

The Euro was bearish against most of its major pairs with the exception of the NZD, GBP and USD. In Europe, no major economic data was released.

The Australian dollar was bullish against all of its major pairs.

Gold jumped $39.94 (+2.05%) to $1985.06.

VIX index declined 0.7pt (-3.17%) to 21.35.

The USD/JPY dropped 59 pips to 106.00 in Monday's trading session. The currency pair appears to have just broken to the downside of a short-term ascending wedge pattern that began to form on July 31st. The overall trend of the pair remains bearish and will likely continue to fall to 105.30 as long as price action remains below 107.05. 

Source: GAIN Capital, TradingView

Build your confidence risk free

More from USD

Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.