|Day's Range||1.14 - 1.143|
|52 Week Range||1.1223 - 1.2558|
Geo-politics will remain center stage with Britain and Italy heading to their final showdowns, while trade talk chatter will also influence.
Was the latest breakdown to new cycle lows in the EURUSD pair just a false one, or are we going to see a continuation of a longer-term bearish trend?
The combination of the tame inflation report, comments from Fed Chair Powell on cooling global demand and the dovish comments from Fed Vice Chair Clarida stating the Fed is getting closer to neutral, are all signs the Fed may slow its pace of rate hikes and this should be bearish for the U.S. Dollar.
The U.S. dollar sells off versus its major rivals on Friday, after Federal Reserve Vice Chairman Richard Clarida offers some dovish comments. The ailing buck gives more room to rebound to the British pound, which recovers from its worst one-day performance in more than two years on Thursday.
The Euro fell initially during the week, reaching down well below the 1.13 level, but by the time we got to the Friday session, the market had turned around completely to form a hammer. What does this tell us? It’s hard to tell but I think consolidation is key.
The Euro struggled a bit during the trading session on Friday to keep the gains that we had initially enjoyed. Ultimately, the market looks likely to continue to favor the US dollar in general, because quite frankly the Federal Reserve is likely to raise interest rates.
The dollar fell on Friday after Richard Clarida, vice chairman of the Federal Reserve, said that interest rates were near neutral, but indicated that a December rate hike is still possible. Clarida told CNBC on Friday that the Fed hasn’t raised rates too far or fast but that it’s too early to know if they should increase rates too far to hold back growth. The 2.5% to 3.5% range is considered a neutral level that doesn’t stimulate or hinder the economy, he said.
European markets struggle Friday, finishing in the red and with chunky weekly losses, as concerns about the U.K.’s Brexit deal again hit top banks, and chip makers are dented after Nvidia Corp. warn on weaker sales ahead.
Although German bond yields initially rose on Friday on the back of some of Draghi’s comments, the Euro retreated from its highs with traders perhaps rattled a little by the uncertainty over the timing of the first rate hike and the possibility of a change in guidance.
Basically, the EUR/USD is trading between a pair of price clusters. On the downside, the support cluster comes in at 1.1296 to 1.1293. On the upside, the resistance cluster comes in at 1.1361 to 1.1369.
Investing.com - Sterling rallied on Friday, despite concerns over Brexit and the resignation of key officials in Prime Minister Theresa May’s government.GBP/USD rose 0.34% to 1.2818 as of 5:37 AM ET (10:37 GMT), after slumping to 1.2739 on Thursday after Brexit minister Dominic Raab resigned.Raad said he could not support the prime minister’s support terms of the the draft.Meanwhile at least 16 members of the Conservative Party have called for a vote of no confidence in May, increasing the chance of the country leaving the European Union in March without a deal. ...
Euro zone inflation rose in October at its fastest pace in nearly six years, driven by energy prices, the European Union statistics agency said on Friday, confirming its earlier estimate. The core inflation measure which excludes energy and food was revised down. Eurostat said that consumer prices in the 19 countries sharing the euro rose 2.2 percent year-on-year in October after a 2.1 percent increase in September and a 2.0 percent gain in August.
The pair initially rallied during the Thursday’s session but found enough resistance around the 1.1350 level to roll back and break below the 1.13 level. The market is thrown off the track by recent Brexit headlines, Italian debt crisis situation and Fed raising the interest rates. If the market breaks below the 1.12 level, then it could break further possibly towards the 1.10 level. The 1.1350 is massively resistive, that extends up to the 1.14 level. …Read MoreGBP/USD
The pair moved off the daily highs ahead EZ CPI today while Brexit continues to weigh
With economic data on the lighter side, we can expect geo-politics to continue to take center stage, the Pound in desperate need of good news.
Investing.com – The dollar rose against its rivals Thursday as mostly bullish economic data reaffirmed investor expectations that the U.S. economy remains on solid footing, while a slump in the pound also lifted sentiment.
The British pound is the major story for currency traders on Thursday as it tanks against it major rivals, amid further turmoil for U.K. Prime Minister Theresa May’s Brexit plan.
Investing.com - The U.S. dollar was higher on Thursday as jobless claims data remained in line with a strong economy, supporting a Federal Reserve rate increase.The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, rose 0.32% to 96.97 as of 10:40 AM ET (15:40 GMT).The number of people who filed for unemployment assistance in the U.S. rose by 2,000 to a seasonally adjusted 216,000 from the previous week’s total of 214,000. The numbers give support to the Federal Reserve gradually increasing interest rates. ...
EUROPE MARKETS European markets suffered broad losses Thursday, after the resignation of the U.K.’s Brexit secretary and other departures triggered massive uncertainty over the country’s plans to exit from the EU and the future of the government.
The Euro rallied significantly during the early part of the trading session on Thursday but has given back quite a bit of the gains as we simply are in a bit of a holding pattern and most certainly in a downtrend longer term.
The Brexit news had a negative impact on the pound, the US futures market was indicating a positive open for equity indices in the early hours of the morning.
With the EUR/USD trading nearly unchanged and having tested both support and resistance, it’s hard to identify a direction at that time. On the downside, the first support angle is 1.1276. This stopped the selling earlier. If support is established at 1.1276 and this can create enough upside momentum then look for the rally to possibly extend into the short-term 50% level at 1.1359.
Investing.com - The dollar held steady against a currency basket on Thursday, while the British pound dipped amid uncertainty over whether Prime Minister Theresa May's draft Brexit plan will win parliamentary approval.
The pair continued to witness extreme volatility, initially pulling back a bit in the Wednesday’s session but then turned around to break above the 1.13 level, showing resiliency around the major levels. The market has not fully recovered from the bearish trend, and short-term rallies will offer a great selling opportunity. The 1.1350 level above is extremely resistive and will be difficult for the market to break above. …Read MoreGBP/USD