Market Update - 05 January 2023

USD/JPY touches a four-day high on Thursday, though lacks any follow-through. The emergence of some buying around the USD acts as a tailwind for the major. Reports that BoJ will raise inflation forecasts benefit the JPY and caps the upside. (FXStreet)

EUR/USD adds to Wednesday’s recovery above the 1.0600 level. The dollar looks indecisive as traders assess the FOMC Minutes. Investors will closely follow the ADP report and weekly Claims. (FXStreet)

GBP/USD comes under renewed selling pressure on Thursday amid a pickup in the USD demand. Recession fears weigh on investors’ sentiment and drive some haven flows towards the greenback. The Fed’s less hawkish outlook might keep a lid on the USD and limit deeper losses for the major. (FXStreet)

USD/CAD defends 100-day SMA and rebounds from a one-month low touched on Thursday. Looming recession risks weigh on investors’ sentiment and benefit the safe-haven greenback. An uptick in oil prices could underpin the Loonie and cap any meaningful gains for the major. (FXStreet)

The index adds to Wednesday’s losses in the low-104.00s. The ADP report, weekly Claims will be in the limelight. FOMC’s Bostic and Bullard will also speak later in the session. The USD Index (DXY), which tracks the greenback vs. a bundle of its main competitors, remains on the defensive just above the 104.00 mark on Thursday. (FXStreet)

AUD/USD comes under some selling pressure on Thursday, though the downside seems cushioned. Looming recession fears cap the optimism in the markets and undermine the risk-sensitive Aussie. Rising bets for smaller Fed rate hikes weigh on the USD and help limit deeper losses for the major. (FXStreet)

The AUD/JPY rallied more than 2.90% on Wednesday on an upbeat sentiment. Double bottom in the AUD/JPY daily chart could pave the way for further upside. AUD/JPY Price Analysis: The double bottom targeted is the 95.00 figure. (FXStreet)

Oil prices have sensed a moderate demand around $73.00 after carnage on Wednesday. Bleak economic outlook led by sustainability of higher interest rates by the Fed impacts the black gold. Weaker manufacturing activities in the US consecutively for the second time have triggered recession fears. (FXStreet)

Prices of the natural gas halted the steep multi-session decline on Wednesday, rebounding decently above the $4.000 mark per MMBtu. The bounce was on the back of rising open interest, which could underpin further bullish attempts in the very near term. (FXStreet)

Gold price is displaying a sideways profile on a broader note ahead of US Employment data. As per FOMC minutes, no Fed policymaker has advocated for cutting rates in CY2023. A sheer drop in US NFP and a higher Unemployment Rate could trigger recession fears. (FXStreet)

Silver struggles to gain any meaningful traction on Thursday and remains below the $24.00 mark. The overnight break below two-month-old ascending trend-line support favours bearish traders. Mixed oscillators on hourly/daily charts warrant caution before positioning for a further decline. (FXStreet)

Source: FXStreet, DailyFX

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