GBPUSD plunged below $1.19, while AUDUSD lost 1.9% as traders damped riskier assets and rushed towards greenback following Fed Chair Powell's hawkish comments. During his testimony in front of Congress Powell said that the Fed might need to increase interest rates more than forecast to combat inflation. Elsewhere, the Bank of England is seen increasing rates by a further 25 bps this month, before ending the current tightening cycle. Board member Catherine Mann had warned on Tuesday that the pound could be vulnerable to Federal Reserve and European Central Bank hawkish outlooks. Powell’s remarks drove money markets to bet on a 50 bps interest rate hike this month, compared to prior expectations of a softer 25bps. The yield on the US 10-year Treasury note briefly jumped above 4.0%, which put additional pressure on precious metals. Gold retreated to support at $1820, while silver plunged nearly 4.0% to $20.25 mark.
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Create account Try a demo Download mobile app Download mobile appGBPUSD fell sharply and is currently testing key support at 1.1860, which is marked with lower limit of the 1:1 structure, 200 SMA (red line) and 38.25 Fibonacci retracement of the downward wave started in June 2021. Should break lower occur, downward move may deepen towards October 2022 highs at 1.1650. Source: xStation5
SILVER is losing over 5.0% on a weekly basis and is approaching psychological support at $20.00 which coincides with 200 SMA (red line). Source: xStation5
US500 also retreated sharply and is approaching key support at 4000 pts. Source: xStation5
The US dollar is the strongest G10 currency on Tuesday. Source: xStation5
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