U.S. dollar strengthens exceptionally as stakeholders have expressed strong support for the CRA (Community Reinvestment Act)

Here is what traders must know about the responsible factors for high volatility:

  • S. dollar strengthens tremendously against major peers on a proposal by Fed to modernize the Community Reinvestment Act (CRA) regulatory and supervisory framework
  • Fed’s CRA also proposes to create incentives for bank investments in geographic areas of need outside of assessment areas, including in Indian Country
  • Fed’s Kaplan: he is worried new forward guidance will spark risky trading
  • Fed’s Kaplan signals for the steady rate for 2.5 to 3 years
  • Fed’s Kaplan: some extension of unemployment benefits is critical
  • Fed’s Kaplan: Fed still has things it could, with asset purchases and for small businesses
  • ECB’s Lagarde: The Strength Of the recovery remains very uncertain, as well as uneven and incomplete
  • ECB’S Lagarde: We are attentive to the euro’s appreciation

Along with this, below mention are the supportive factors for the massive movement:

  • Rising Corona virus cases across the Globe
  • K. is reportedly planning for another national lock down to control pandemic situation
  • Global stock indices dropped more than 2 pct for the day
  • Trump to announce Supreme Court Nominee by this week end
  • S. announced a ban on China app WeChat and TikTok
  • Over the weekend, China’s Ministry of Commerce released long-awaited provisions on its so-called “unreliable entity list
  • Australian PM optimistic on employment data as corona cases drop comparatively
  • Suga Yoshihide elected as Japan’s new PM, replacing Shinzo Abe but Abe’s policy is likely to continue in near future
  • Ghana, Africa’s largest gold producer, is planning an up to $500 million listing of its gold royalty fund in London in October

Technical View:

XAU/USD: Gold spikes down on strong U.S. dollar and hits fresh 6 – week low at $1,882 mark. Today pair made intraday high at $1,955 and low at $1,882 mark. A sustained close above $1,975 requires for the upside rally. On the other side, consistent close below $1,902 will check key supports as well.
Key support levels are seen around $1,882, $1,870, $1,862, $1,849, $1,840, $1,822, $1,809 and $1,787 mark respectively.
Key resistances are seen at $1,902, $1,910, $1,922, $1,932, $1,940, $1,947, $1,957, $1,972, $1,982, $1,994, $2,008, 2,020, 2,038 and $2,063 marks respectively.

Take a look and do trade wisely!

Good Luck

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