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The U.S. dollar index hits a six-day high, and gold suffers its biggest one-day drop in years

Post time: 2025-10-22 views

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Hello everyone, today XM Forex will bring you "[XM Forex Decision Analysis]: The U.S. dollar index hit a six-day high, and gold suffered the largest one-day decline in years." Hope this helps you! The original content is as follows:

On October 22, in early trading in Asia on Wednesday, Beijing time, the U.S. dollar index was hovering around 98.91. On Tuesday, market optimism about the trade agreement boosted the U.S. dollar, with the U.S. dollar index hitting a six-day high and finally closing up 0.36% at 98.95. The benchmark 10-year U.S. Treasury yield finally closed at 3.974%, and the 2-year U.S. Treasury yield, which is sensitive to the Fed's policy rate, closed at 3.463%. Gold and silver suffered their sharpest sell-off in years on Tuesday as investors locked in profits on concerns that recent historic gains have left them overvalued. Spot gold once fell 6.3%, the largest one-day decline since April 2013, and finally closed down 5.31%, at $4,124.36 per ounce; spot silver finally closed down 7.11%, at $48.66 per ounce. Oil prices rose as the United States planned to purchase 1 million barrels of crude oil to replenish the U.S. Strategic Petroleum Reserve. WTI crude oil approached the 58 mark during the session and finally closed up 1.14% at US$57.57/barrel; Brent crude oil finally closed up 1.03% at US$61.58/barrel.

Analysis of major currency trends

U.S. dollar index: As of press time, the U.S. dollar is hovering around 98.91. The U.S. dollar index has benefited from the support brought by policy differentiation and the rebound in optimism related to U.S. fiscal stability. The U.S. dollar index will most likely maintain a bullish tone before the release of inflation data this Friday. Technically, the U.S. Dollar Index is trying to settle above resistance at 98.85–99.00. If this attempt is successful, the USD Index will move towards the next resistance level, which is located in the 100.00–100.15 range.

The U.S. dollar index hits a six-day high, and gold suffers its biggest one-day drop in years(图1)

EUR: EUR/USD is hovering around 1.1606 at press time. European Central Bank chief economist Philip Ryan said that if dollar financing dries up due to Trump's policies, euro zone banks may www.stofoco.come under pressure since Trump announced trade tariffs. USD financing has been a focus for central bankers. Technically, if EUR/USD manages to close below the support level of 1.1585–1.1600, it will move towards the next support level, which is located in the 1.1505–1.1520 range.

The U.S. dollar index hits a six-day high, and gold suffers its biggest one-day drop in years(图2)

GBP: As of press time, GBP/USD is hovering around 1.3374. GBP traders are withdrawing their buys ahead of the latest consumer price index (CPI) inflation data due on Wednesday, while US CPI data is due on Friday. Technically, a break below the support levels at 1.3330–1.3350 will open the way to a test of the next support levels at 1.3235–1.3250.

The U.S. dollar index hits a six-day high, and gold suffers its biggest one-day drop in years(图3)

Analysis of gold and crude oil market trends

1) Analysis of gold market trends

In Asian trading on Wednesday, gold hovered around 4080.57. Huang In the current turmoil in the global financial market, gold's status as a traditional safe-haven asset is once again facing a severe test. Spot gold prices suffered a heavy setback on Tuesday (October 21), falling as much as 5.3% in a single day, closing at $4,124/ ounces, this is not only a new low in the past week, but also the largest single-day decline since August 2020. Gold prices hit a low of $4,083.15 per ounce during the session, falling nearly $300 from the day's high, catching countless investors off guard. This plunge is not an isolated incident, but the result of multiple factors, including investor profit-taking, weakening demand for safe havens, and subtle changes in the macroeconomic environment.

The U.S. dollar index hits a six-day high, and gold suffers its biggest one-day drop in years(图4)

Technical: The price of gold has clearly fallen below the 21-period simple moving average (SMA). If bulls try to rebound, the moving average will be transformed into an immediate resistance level. The short-term outlook is bearish, with initial support at $4,200, which is also the neckline of the double top pattern. If gold prices continue to fall below this level, a short-term bearish reversal signal will be confirmed, and the next support level will point to the 50-period simple moving average (about $4,180). If the decline continues further, gold prices may test the $4,050 range, where the 100-period simple moving average forms a stronger support confluence area. The relative strength index (RSI) also confirmed the cautious sentiment, with the indicator showing a downward trend.It is trending and forming a bearish divergence from the price. If the RSI falls below the 50 mark, it will further strengthen the possibility of a deep correction in gold prices.

2) Crude oil market trend analysis

On Wednesday in the Asian market, crude oil was trading around 57.40. WTI's rise suggests that the easing of Sino-U.S. trade frictions has outweighed the impact of a rising dollar and oversupply concerns. Traders awaited a U.S. Energy www.stofoco.comrmation Administration (EIA) inventory report later on Wednesday.

The U.S. dollar index hits a six-day high, and gold suffers its biggest one-day drop in years(图5)

Technical: A break above the $58.00 level would open the way to a test of the recent resistance at $60.00 to $60.50.

Foreign exchange market transaction reminder on October 22, 2025

14:00 UK September CPI monthly rate

14:00 UK September retail price index monthly rate

20:25 European Central Bank President Lagarde delivers a speech

22:30 EIA crude oil inventories in the United States for the week of October 17

22:30 EIA crude oil inventories of the United States for the week of October 17 Cushing crude oil inventory

22:30 EIA Strategic Petroleum Reserve inventory in the United States for the week of October 17

At 04:00 the next day, Federal Reserve Board Governor Barr delivered a speech on financial inclusion

The above content is about "[XM Foreign Exchange Decision Analysis]: The U.S. dollar index hit a six-day high, and gold suffered the largest single-day decline in many years". It was carefully www.stofoco.compiled and edited by the XM Foreign Exchange editor. I hope it will be helpful to your trading! Thanks for the support!

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