Daily Market Review — 17/11/2015
The CPI Reports in the UK and US Will Be in Focus Today
The pair showed mixed trends in yesterday’s trading, and closed downwards. Such dynamics were caused, first of all, by a general strengthening of the US currency. The markets froze in anticipation of two important reports. At 09:30 (GMT) the UK inflation report will be released, including indicators such as the Consumer Price Index, Producer Price Index and others. The bulk of the attention will be focused on the CPI as it represents a major metric for the British regulator. A few hours later, a similar report will be published for the US economy, at 13:30 (GMT), also including the CPI (excluding food and energy). FOMC members will analyze very closely every such economic indicators before the Fed meeting in December. Their decision to raise rates at the end of this year relies heavily on this data.
Resistance: 1.5200, 1.5247, 1.5327
Support: 1.5145, 1.5090, 1.5027
The beginning of this week was marked by sell-off of the European single currency on the background of the terrorist attacks that took place in Paris on the night of Friday to Saturday. However, the market reaction was short. In the European session, the pair won back the losses incurred earlier. In the second half of yesterday’s trading session, however, the EUR/USD moved back to a downward trend, despite the published final data on CPI in the Eurozone, which was slightly better than forecasted. Today’s dynamics of the pair will be influenced by the ZEW Survey Economic Sentiment index, scheduled for 10:00 (GMT). Moreover, at 13:30 (GMT) the US inflation report will be released, which plays a key role in light of expectations of a rate hike in December.
Resistance: 1.0706, 1.0789, 1.0843
Support: 1.0653, 1.0598, 1.0461
The major US stock exchanges increased significantly on Monday, after opening with a huge drop amid terrorist attacks in France. But the impact and consequences of this situation have only had a short-term impact on the stock markets. Investors prefer to buy depreciating stocks. Yesterday’s trading was influenced by the NY Fed Empire State manufacturing index, which grew more than the previous value, but fell short of the forecast. Today, the focus of investors’ attention will be on the US inflation report. Meanwhile, the markets are preparing for a tightening monetary policy by the US Federal Reserve, especially after the speech of Vice-Chairman Stanley Fischer, who said that December is the best time for such a step.
Resistance: 2053.53, 2064.05, 2083.66
Support: 2037.91, 2026.28, 2010.83
Light Sweet Crude Oil Futures
The quotes of “black gold” increased during yesterday’s session, while showing mixed trends. In early trading oil rose amid escalating conflict in the Middle East and in response to the event on Friday evening in France. This caused concerns among investors about a possible shortfall in supplies of raw materials. However, later it became known that the OPEC countries have recently lowered their sale prices of oil to the lowest level since 2009. The output in the United States and in the OPEC is at record levels, in order to protect the suppliers’ market share. As a result of the sharp fall of oil prices recently, investors preferred to close their positions and take their profits yesterday, allowing quotations to rebound from the level of $40 per barrel. Meanwhile, investors will closely monitor data from the API on US oil stocks, to be released at 21:35 (GMT).
Resistance: 42.59, 43.58, 44.15
Support: 41.09, 40.02, 39.22