FX possibility expiries for 20 March 10am New York minimize

There are some holding relatively close by for EUR/USD and AUD/USD at the 1.1500 and 0.7050 levels respectively. However, they aren’t likely to feature much into play. As things stand, dollar sentiment remains the key driver of price action as we look to close out the week. In that lieu, US-Iran headlines, oil prices, and the risk mood are all bigger factors influencing trading sentiment. And after all, they are pretty much all bound together still in trading this week.

The dollar fell off yesterday despite some mixed market sentiment. Central bank rate hike expectations are growing and that pinned down equities. However, Wall Street did post a modest recovery in hopes that the Middle East conflict will end sooner rather than later. That also saw oil prices come off the boil with Brent crude in particular closing at $108.65, after having hit a high just above $119.

So, the mix of everything will once again be in focus. That alongside the bond market too, after seeing 10-year Treasury yields hit 4.32% overnight before settling down to 4.25%. With central banks back in focus though, short-term yields are also one to keep an eye out for. A big mover yesterday was 2-year gilt yields, which shot up by over 30 bps to 4.43%. 2-year Treasury yields also jumped from 3.78% to a high of 3.95% but dropped back off after to 3.79%.

As such, rate spreads will also be a consideration for the dollar against some major currencies at this time.

For now though, we are seeing the dollar find a bit of respite in what has been quite a mixed week before the sharper drop yesterday. But I would expect things to heat up later in the day, especially when we get closer to US trading again.

For more information on how to use this data, you may refer to this post here.

Head on over to investingLive (formerly ForexLive) to get in on the know!