ForexLive European FX news wrap: Congress certifies Biden as US president

Author: Justin Low | Category: News

Forex news from the European trading session - 7 January 2021



  • USD leads, AUD lags on the day
  • European equities mixed; E-minis up 0.4%
  • US 10-year yields up 1.4 bps to 1.049%
  • Gold flat at $1,917.77
  • WTI up 0.5% to $50.88
  • Bitcoin up 5.6% to $37,957

EOD 07-01
The chaotic scenes in Capitol Hill will be one for the history books but it doesn't change the outcome of the November elections, as Congress shot down all challenges to the electoral college and certified a Biden victory in the wee hours today.

That said, the market has come to terms with this for quite some time now as all the drama was pretty much what is, just drama.

As yields kept higher, equities were also buoyed after a pullback late yesterday when protestors stormed the Capitol with US futures keeping firmer throughout.

In the currencies space though, the dollar put up a modest showing as it posted a decent advance across the board against the rest of the major currencies.

USD/JPY led the way in a push from 103.10 to 103.75 on the back of the continued breakout in Treasury yields, before dollar gains stalled slightly in the past hour or so.

Meanwhile, EUR/USD fell below its key hourly moving averages in a drop from 1.2320 to 1.2245 before moving back above its 200-hour moving average to near 1.2270 currently.

AUD/USD also fell from 0.7780 to 0.7731 to test its 100-hour moving average, before bouncing off the key near-term level to near 0.7750.

Elsewhere, gold continues to get caught in a tussle between its key hourly moving averages after the stumble yesterday - hovering around $1,910-25 for the most part.

Looking ahead, the market will have to go about figuring out what to do with the prospect of higher yields (for now at least) and how to go about the latest happenings in the US political scene this week (although not much has changed to be honest).

In the big picture though, I would argue that the market landscape hasn't changed as the key driver i.e. the Fed is still quietly going about its business in the background. BRRRR!!!

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