Commodity currencies were swept to multi-month peaks as the war in Ukraine sent oil prices spiking

*The dollar was up on Monday morning in Asia, with the euro falling to a fresh 22-month low

*The Australian and New Zealand dollars each rose 0.9% to four-month peaks

*Sterling has also been weighted by gloom over Europe's outlook and fell to a two-month low

The euro tumbled to a fresh 22-month low on the dollar while commodity currencies were swept to multi-month peaks as the war in Ukraine sent oil prices spiking and stoked fears of a stagflationary shock that could hammer Europe.

The euro fell as much as 1% to $1.0822 in Asia trade, its lowest since May 2020. It is down more than 4% since Russia began what it calls a special military operation in Ukraine and is not far from testing its 2020 trough of $1.0636. It also fell below one Swiss franc for the first time since the Swiss quit their euro peg in 2015, hitting 0.9970. 

Economic Calendar

Oil futures, which surged more than 20% last week, leaped to highs not seen since 2008 as the United States and Europe mulled bans on Russian imports. Wheat hit a 14-year high. The Australian and New Zealand dollars each rose 0.9% to four-month peaks. 

The crisscross of pipelines from Russia through Ukraine is just indicative of how enmeshed and dependent much of Europe has become on Russian energy and that's not something you can turn around quickly. A much gloomier European growth outlook is being priced in. The euro fell on Monday to a 15-month low of 124.39 yen and touched its lowest since mid-2016 on the pound at 82.01 pence. 

Against the Aussie, the euro has lost more than 10% over about a month. Euro/dollar volatility gauges are at their highest since March 2020. Fighting in Ukraine intensified over the weekend and attempts at a ceasefire to allow civilians to evacuate from the besieged city of Mariupol seem to have so far failed. 

Buy and Sell over 250 crypto derivatives with ultra-low spreads

The conflict and harsh western sanctions on Russia have sent Russian assets tumbling and prices of Russian exports such as precious metals, oil, and gas soaring at a time when the global economy was already grappling with inflationary pressures. 

All up, it's another big, ugly supply shock on top of lingering COVID impacts, with serious inflationary consequences that give central banks absolutely no room to give growth a chance. Sterling has also been weighted by gloom over Europe's outlook and fell to a two-month low of $1.3187. The South Korean won was pummeled to a 21-month trough and traders said South Korea's foreign exchange authority was buying to try and limit the decline.

Euro

The single currency tumbled to a fresh 22-month low on the dollar while commodity currencies were swept to multi-month peaks as the war in Ukraine sent oil prices spiking and stoked fears of a stagflationary shock that could hammer Europe. The euro fell as much as 1% today in Asia trade, its lowest since May 2020 Overall, the EUR/USD traded with a low of 1.0884 and a high of 1.0665 before closing the day around 1.0934 in the New York session.

Yen

The Japanese Yen traded slightly lower against the U.S Dollar. The ongoing conflict in Ukraine drove up commodity prices and stoked fears of a stagflationary shock that would hit Europe the hardest. The U.S Dollar Index that tracks the greenback against a basket of other currencies was up 0.27% to 98.933. It was near a 22-month peak of 98.925 hit on Friday. Overall, the USD/JPY traded with a low of 114.63 and a high of 115.53 before closing the day around 114.83 in the U.S session.

Free Forex Webinars

British Pound

The British Pound has also been weighted by gloom over Europe's outlook and fell to a two-month low of $1.3187. The South Korean won was pummeled to a 21-month trough and traders said South Korea's foreign exchange authority was buying to try and limit the decline. Fighting in Ukraine intensified over the weekend. Overall, the GBP/USD traded with a low of 1.3200 and a high of 1.3353 before closing the day at 1.3238 in the New York session.

Canadian Dollar

The Canadian Dollar fell against its U.S counterpart on Friday and was on track for a weekly decline as the intensifying war in Ukraine triggered a flight to quality, overshadowing encouraging U.S jobs data. U.S crude prices were up 3.4% at $111.28 a barrel as fears over disruption to Russian oil exports in the face of Western sanctions. Overall, USD/CAD traded with a low of 1.2667 and a high of 1.2789 before closing the day at 1.2735 in the New York session.

Australian Dollar

The Australian Dollar was at a four-month high today courtesy of a massive rally in commodity prices and a slump in the euro to its lowest since 2017. The Aussie climbed 1.9% last week and finally cracked the January peak of $0.7314. RBA Governor Philip Lowe is due to give a speech on Wednesday where he will likely expand on their latest thinking on inflation and wages. Overall, AUD/USD traded with a low of 0.7138 and a high of 0.7235 before closing the day at 0.7231 in the New York session.

Trading Signals and Trading Forecasts

Euro-Yen

EUR/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also issuing a bearish stance. The Relative Strength Index is above 40 and lies below the neutral zone. In general, the pair has lost 1.70%.

Sterling-Yen

Currently, GBP/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 42 reading and lies below the neutral zone. On the whole, the pair has lost 1.35%.

Aussie-Yen

Currently, the cross is trading above 14, 50 and below 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 54 reading and lies above the neutral region. In general, the pair has gained 0.06%.

Euro-Sterling

This cross is currently trading above 14, 50 and below 100 days moving average. Fast stochastic is indicating a bullish tone and MACD is also issuing a bullish signal. The Relative Strength Index is above 46 and lies below the neutral region. Overall, the pair has lost 0.35%.

Sterling-Swiss

This cross is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bearish stance and MACD is also indicating a bearish tone. The Relative Strength Index is above 40 and lies below the neutral region. In general, the pair has lost 0.86%.

Elliott waves forex trading idea for AUD/USD

###

All information has been prepared by TraderFactor or partners. The information does not contain a record of TraderFactor or partner's prices or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. Any material provided does not have regard to the specific investment objective and financial situation of any person who may read it. Past performance is not a reliable indicator of future performance.