Forex Today: US Dollar struggles to build on Tuesday's gains

Here is what you need to know on Wednesday, August 9:

The US Dollar is finding it difficult to preserve its strength on Wednesday after posting gains against its major rivals on Tuesday. The risk mood improves modestly midweek in the absence of high-tier data releases, with US stock index futures edging higher in the European session. Comments from central bank officials could drive the action in financial markets ahead of Thursday's highly-anticipated inflation data from the US.

Wall Street's main indexes suffered heavy losses on Tuesday as markets reacted to disappointing trade data from China. During the American trading hours, dovish comments from Federal Reserve policymakers, however, capped the rally of the US Dollar Index (DXY). At the time of press, DXY was in the negative territory below 102.50.

After touching its lowest level since early June below 0.6500, AUD/USD regained its traction and was last seen trading above 0.6550. Similarly, NZD/USD trades in positive territory near 0.6100. The Reserve Bank of New Zealand announced that the two-year inflation expectation rose slightly to 2.84% in the third quarter from 2.79% in the second.

EUR/USD fell to a daily low of 1.0930 on Tuesday but managed to close the day above 1.0950 following a late rebound. The pair clings to small daily gains early Wednesday but stays below 1.1000.

GBP/USD erased a large portion of its daily losses after dipping below 1.2700 n Tuesday. The pair preserves its recovery momentum and trades above 1.2750 in the European morning.

Following a two-day rally, USD/JPY lost its momentum and retreated to the 143.00 area on Wednesday. The data from Japan showed that Machine Tool Orders declined 198% on a yearly basis in July.

Gold price fell to a multi-week low near $1,920 on Tuesday and registered daily losses. As the benchmark 10-year US Treasury bond yield holds steady at around 4%, XAU/USD clings to modest recovery gains near $1,930.

Bitcoin gathered bullish momentum and climbed above $30,000 after moving sideways in the past few days. BTC/USD, however, failed to clear that level and retreated modestly toward $29,700. Ethereum gained more than 1.5% on Tuesday but lost its momentum before testing $1,900.