Brent oil reverses week-start rebound as sour sentiment favors US Dollar

Global markets return to risk-averse mode as US and Canadian traders are back to their desks after a long weekend. Adding strength to the downbeat mood is the anxiety ahead of the first readings of February’s activity data from the Eurozone, the UK and the US. Furthermore, Canada's inflation numbers and Eurozone ZEW data are some extra loads for market watchers.

The sour sentiment joined recovery in the US Treasury bond yields to underpin the US Dollar’s rebound, which in turn exerted additional downside pressure on the AUDUSD prices, other than due to its risk-barometer pair.

EURUSD and GBPUSD are also down while NZDUSD seems bracing for Wednesday’s RBNZ decision amid fears of a pause to the rate hike trajectory.

Elsewhere, Gold price snaps a three-day uptrend while Brent oil reverses the previous day’s gains on hopes of more energy supply and a firmer USD.

Cryptocurrencies also failed to ignore the greenback’s strength as BTCUSD and ETHUSD grind near the multi-week high amid mixed headlines from the industry.

Following are the latest moves of the key assets:

• Brent oil reverses the week-start recovery while dropping half a percent to $83.40 at the latest.
• Gold snaps three-day rebound with 0.50% intraday losses near $1,835.
• USD Index prints the first daily gains in three around 104.15 by the press time.
• Equities in the Asia-Pacific region, as well as the shares in Europe and the UK, trade mildly negative as of late.
• BTCUSD and ETHUSD remain clueless near $25,000 and $1,700 amid mixed news and the firmer US Dollar.

Full markets highlight the risk off mood

Given the recent geopolitical fears and the fresh hopes of the Fed’s further rate hikes, the traders turned risk-averse amid the full markets on Tuesday. In doing so, the traders also cheer the early-day headlines suggesting more tension as US braces for a speedy trade deal with Taiwan while China is alleged to support Russia. That said, concerns surrounding a pullback in the Eurozone’s economic recovery and extra pain for the British economy, due to Brexit, act as extra negatives for the risk appetite.

As a result, the US Dollar managed to begin the true week-start on a firmer footing as traders await the US PMI. The same joins fears of more strategic oil reserve release from the US and Saudi Arabia’s readiness to alter the output cut accord, if needed, to weigh on the Brent oil price.

China-linked concerns join hawkish central bank hopes to recall the Gold bears while NZDUSD drops the most among the G10 currency pairs as natural calamities in the Pacific nation seem to join the higher rates to increase the pain of Auckland’s economy.

Elsewhere, cryptocurrencies struggle to justify upbeat chain matrices and more inflow amid fears of harsh regulations and more bankruptcies.

• Strong buy: USDJPY
• Strong sell: ETHUSD, GBPUSD
• Buy: USD Index, USDCAD, Nasdaq, EURUSD
• Sell: DAX, FTSE 100, gold, BTCUSD, AUDUSD

A data-dump ahead

Be it Eurozone sentiment figures or the activity data, not to forget the monthly PMIs from the UK and the US and Canadian inflation numbers, everything offers busy day ahead. However, the underlying hawkish expectations from the Fed and the risk-off mood seem to keep the US Dollar buyers hopeful.

May the trading luck be with you!