AUD in Distress and DAX at the Edge: Thursday's Critical Market Movements

Starting with the calendar, yesterday brought us the FOMC meeting minutes, revealing Fed officials’ anticipation of potential upside risks to inflation. This sentiment might pave the way for more frequent rate hikes.

From across the pond, the UK reported inflation slightly higher than anticipated, at 6.8% — albeit a step down from the prior rate of 7.9%. Meanwhile, US industrial production pleasantly surprised us, posting a 1% gain, compared to the expected 0.3%.
Today's schedule was no less notable, featuring disappointing job data from Australia: a decrease of 14.6 thousand in employment and a climb in the unemployment rate to 3.7%.

In response to the discouraging Australian employment stats, the Australian dollar sits as today’s weakest link. On the brighter side, both the Canadian and American dollars are registering gains.

Reflecting on Wednesday's Forex market, the British Pound wore the crown, while the Japanese Yen trailed behind.
As for the charts, the EURUSD continues its descent, setting new monthly lows, while the USDJPY gains height, elevating to new monthly highs. The NZDUSD isn't faring much better, marking its eighth consecutive bearish day and landing at its lowest point since November 11.

Switching gears to indices, the last two days have been a rough patch, with Tuesday and Wednesday serving a serious blow to bullish traders. The S&P 500 set new monthly lows, and the Dow Jones is toeing dangerously close to the 34,500-points support line.

The NASDAQ echoes this gloom with its own set of new monthly lows, while the DAX is caught in a struggle to maintain its footing above the crucial 15,700-points support, which stands as the last bastion for bullish hopes. A significant drop below this line could open the floodgates for short positions.

Lastly, a glance at commodities brings gold to our attention, as it teeters on the edge of the key $1,900 support level – a significant psychological milestone. Oil, too, has weathered rough seas over Tuesday and Wednesday, affirming the $83 resistance on WTI and $88 on Brent.

In a nutshell, a storm seems to be brewing in the stock and commodities markets, while the US dollar sails smoothly on. For now, negative sentiment shrouds stocks and commodities, as the dollar continues its confident stride.