ForexLive European FX news wrap: Currencies muted as markets settle down after China woes

<p>Headlines:</p><ul><li><a href="https://www.forexlive.com/news/dollar-has-the-recipe-for-the-next-leg-higher-20230814/">Dollar has the recipe for the next leg higher</a></li><li><a href="https://www.forexlive.com/news/pressure-on-the-chinese-yuan-is-a-tailwind-for-the-dollar-20230814/">Pressure on the Chinese yuan is a tailwind for the dollar</a></li><li><a href="https://www.forexlive.com/news/stocks-recover-some-poise-on-the-session-20230814/">Stocks see a snap rebound on the session</a></li><li><a href="https://www.forexlive.com/news/german-economy-ministry-early-indicators-dont-yet-point-to-sustainable-economic-recovery-20230814/">German economy ministry: Early indicators don't yet point to sustainable economic recovery</a></li><li><a href="https://www.forexlive.com/news/germany-july-wholesale-price-index-02-vs-02-mm-prior-20230814/">Germany July wholesale price index -0.2% vs -0.2% m/m prior</a></li><li><a href="https://www.forexlive.com/news/snb-total-sight-deposits-we-11-august-chf-4848-bn-vs-chf-4929-bn-prior-20230814/">SNB total sight deposits w.e. 11 August CHF 484.8 bn vs CHF 492.9 bn prior</a></li></ul><p>Markets:</p><ul><li>USD mixed, little changed</li><li>S&amp;P 500 futures up 0.2%</li><li>US 10-year yields down 1.8 bps to 4.150%</li><li>Gold flat at $1,913.42</li><li>WTI crude down 0.4% to $82.87</li><li>Bitcoin down 0.1% to $29,359</li></ul><p>The session started off with more of a defensive risk mood, after the equities selling in Asia. The Chinese yuan was also dumped and that put some light pressure on the aussie and kiwi currencies early on as well.</p><p>But as we got into European trading, there was a quick snap back higher in stocks and major currencies then settled to being little changed on the day across the board. After that, it has been a relatively quiet one – similar to the kind of lull that we saw last week.</p><p>The dollar is little changed in general but remains poised to claim the next upside leg, with USD/JPY teasing a push above 145.00 especially. EUR/USD is sitting just above its 100-day moving average of 1.0929, keeping at around 1.0930-40 levels mostly.</p><p>Meanwhile, AUD/USD is seeking a break lower to fresh lows for the year but is now keeping just under 0.6500 with the May low at 0.6458 still in focus. NZD/USD is already at its lowest levels this year, tracking below 0.6000 today but is little changed now after recovering from the earlier dip.</p><p>The overall mood in markets remain more tentative I would say and despite the dip buying equities, it needs reminding that this formula did not work in trading last week.</p>

This article was written by Justin Low at www.forexlive.com.