Dovish FOMC meeting minutes sends the greenback higher
The release of the FOMC Meeting Minutes caused extreme market volatility this week, as the US central bank outlined a new strategy. A more dovish than expected stance from the FOMC caused traders to move into the safety of the US dollar and US bonds. The Meeting Minutes revealed that FOMC policy members were discussing a new approach to communicating forward guidance to market participants. The July Meeting Minutes also noted that the US economic outlook was still uncertain, and that policy members were surprised at the strength of consumer spending in America.
- The EURUSD pair is only bearish while trading below the 1.1700 level, key support is found at the 1.1600 and 1.1585 levels.
- The EURUSD pair is bullish while trading above the 1.1700 level, buyers may test towards the 1.1960 and 1.2000 resistance levels.
Bitcoin rallied to a fresh 2020 trading high this week, as the number one cryptocurrency by market capitalization rallied towards the $12,400 level. Bitcoin’s mining hash rate and unique users count hit a fresh all-time high, further underpinning the bullish fundamentals behind the cryptocurrency. Legendary investor, Paul Tudor Jones, continued to outline his support for the pioneer cryptocurrency. Bitcoin eventually edged back towards the $11,600 level as traders decided to book profits after the recent epic bull run.
- The BTCUSD pair is only bearish while trading below the $10,100 level, key support is found at the $9,900 and $9,400 levels.
- If the BTCUSD pair trades above the $10,100 level, buyers may test towards the $12,100 and $12,500 resistance levels.
The British pound rallied to a fresh 2020 against the US dollar currency this week, with the GBPUSD pair moving within touching distance of the 1.3300 level. Traders looked past upcoming risks from Brexit negotiations and decided to focus on the ongoing sell-off in the greenback. The rally towards the 1.3300 level meant that the GBPUSD pair turned positive for 2020, following a tumultuous sell-off towards the 1.1300 level earlier this year. Many economists speculated that the ongoing money printing from the Federal Reserve is currently underpinning sterling strength.
- The GBPUSD pair is only bearish while trading below the 1.3090 level, key support is found at the 1.3000 and 1.2950 levels.
- The GBPUSD pair is bullish while trading above the 1.3090 level, buyers may test towards the 1.3280 and 1.3300 resistance levels.
Precious metals saw another week of wild volatility, with gold breaking back above the $2,000 level and copper moving to a fresh multi-month trading high. Gold recovered back above the $2,000 level after Warren Buffet said that he had invested in gold mining stocks. Gold was also helped from a technical perspective, as the yellow-metal continued to attract strong dip-buying interest. Copper price rose to towards the $3.00 resistance level, touching levels not seen since early 2019 this week, as precious metals continued to attract strong investor demand.
- XAUUSD is only bullish while trading above the $1,920 level, key resistance is found at the $2,010 and $2,080 levels.
- XAUUSD is only bearish while trading below the $1,920 level, key support is located at the $1,900 and $1,880 levels.