Daily Market Review — 15/01/2016
The Publication of US Economic Statistics Will Be the Main Event Today
During yesterday’s trading the pair showed sharp fluctuations. During the European session, the euro has strengthened sharply against the US dollar, after the publication of a report. In the report, analysts said that there is no need for further expansion of stimulus measures by the ECB. After that, the US currency has completely recovered all of its losses due to rising oil and quotations of US stock exchanges. Data on the US labor market also had some influence. Meanwhile, Fed Bullard in his speech yesterday, noted that low oil prices make it difficult to achieve the inflation target. Today, the dynamics of the pair will depend on the publication of a huge block of US economic statistics, which is scheduled to start today at 13:30 (GMT).
Resistance: 1.0900, 1.0943, 1.0991
Support: 1.0834, 1.0803, 1.0769
New Zealand’s currency is becoming cheaper against the US dollar, in the second consecutive week. The reason of this falling is a decline in prices on commodity markets, the main driver of exports from New Zealand. Statistics on the Chinese economy also had a negative effect. Yesterday’s dynamics of pair was influenced by the Fed Bullard comments. He noted that the fall in commodity prices will hamper the achievement of inflation targets. He did not comment regarding any further steps by the US regulator. Today a huge impact on the trades could provide the publication of data on US Retail Sales in 13:30 (GMT). Moreover, at 14:15 (GMT) there will be published the index of US industrial production.
Resistance: 0.6471, 0.6507, 0.6581
Support: 0.6404, 0.6354, 0.6308
The major European stock markets yesterday showed a negative trend, which was due to concerns over global economic growth. Investors didn’t buy securities because were afraid of significant losses. The publication of the minutes of the last meeting of the ECB had some influence. According to published information, some leaders of the European regulator voted for a significant reduction in deposit rates, for fear of slowing the region’s economy. Also, yesterday, the decision of the Bank of England’s key interest rates was announced. As most experts expected, there were no changes to the current settings. Investors have come to terms with the fact that the British regulator will not hurry with the tightening of monetary policy, mainly because of problems with the global economy. Today, US data on retail sales and industrial production, which will be released later in the day, may influence the trades.
Resistance: 5930.52, 5962.93, 6012.20
Support: 5804.88, 5769.41, 5720.30
Precious metals prices dropped significantly yesterday, helped by a reduction in demand for defensive assets. A recovery in the oil prices and stock prices in the US’ markets helped to increase investors’ desire to take risks, and that led to their withdrawal from protected assets. Representative of the Fed’s Bullard noted that the drop in oil prices has a positive impact on the US economy, but also made a difficult task of achieving a rate of inflation of 2%. Also the market was influenced by the statistics on the US labor market, according to which the number of initial applications for unemployment benefits rose moderately last week. Today, the US data to be released later in the day will be in focus of investors.
Resistance: 1089.07, 1099.08, 1108.17
Support: 1070.59, 1058.62, 1047.14