USD Bearish Bias: Various Currencies Capitalize on Greenback’s Weakness

The DXY has been on an overall bearish movement for the past few days having dropped below the 99.50 level. Because the of the weak US Dollar strength, a number of currency pairs were able to capitalize. These included the GBPUSD, AUDUSD, and Gold.

The USD Before the Release of Unemployment Data

While the DXY has been seeing downward movement, this could change with the results of the Unemployment Claims data to be released within the day. The expected number of unemployed individuals is at 3500k. If it is higher than that, the Dollar is expected to fall while the opposite may spark some upward movement.

DXY Effect on the GBPUSD

Aside from USD weakness, the GBP, along with the FTSE-100 gained higher as a number of the country’s companies are going back into operation. Its strength is also fueled by the possible creation of an antiviral drug made by British company Gilead Sciences. Also, AstraZeneca may possibly make a Covid-19 vaccine.

AUDUSD’s Short Term Rise

AUDUSD, on the other hand, has been experiencing a nice uptrend for the past few days after crashing from the recent global lockdowns. Currently, AUDUSD is trading somewhere in the 0.65500 level and may still go up higher. However, the next resistance level is already at 0.66860 so we can expect more strength until it reaches there. Things may move either way after that.

Possible Highs for Gold

Gold has been a superstar in the past few days with its rapid jump to over 1700 levels. Specifically, it has reached a high of around 1736. Right now, it has experienced a pullback and is trading at the 1716 level. Depending on the risk appetite of the market, Gold can possibly reach 1800, according to the strategists of the United Overseas Bank Group’s Quarterly Global Outlook.

As Gold typically has an inverse relationship with the USD, we may see more of a pullback if the US data yields positive results for the Dollar. If not, then the price of Gold may inch up further.

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