Daily Market Review — 18/11/2015
The Main Event Today Is the Release of FOMC Meeting Minutes
The pair rose early in the morning yesterday due to the publication of the Reserve Bank of Australia meeting minutes. However, hints about its monetary policy were fairly sparse. Besides that, the Consumer Price Index was published in the US yesterday. According to the data, all inflationary indicators came out exactly as predicted. Nevertheless, data on Industrial Production, which showed a decline in the sector, put some pressure on the US currency. This morning, the Wage Price Index in Australia was published and it showed some growth. Meanwhile, market participants are waiting for publication of data on the US real estate sector. The Housing Starts and Building Starts indices will be released at 13:30 (GMT). However, the main event of the day will undoubtedly be the publication of FOMC’s meeting minutes at 19:00 (GMT). Market participants will be able to assess FOMC’s readiness to increase interest rates in the near future.
Resistance: 0.7152, 0.7221, 0.7268
Support: 0.7067, 0.7015, 0.6935
The pair began yesterday’s trading session falling amid reports of falling prices for dairy products, New Zealand’s main export product. After that, the NZD/USD spent the rest of the day trading in different directions, a behavior triggered by mixed statistics on the US economy. Even though the inflation rate has met expectations, Industrial Production index pointed to a reduction. Today’s dynamics of the pair will be affected by the US real estate data, to be published at 13:30 (GMT). Special attention will be paid to the FOMC meeting minutes at 19:00 (GMT). The New Zealand’s PPI will also be published later today.
Resistance: 0.6499, 0.6585, 0.6622
Support: 0.6450, 0.6403, 0.6342
The major European stock exchanges have shown a significant growth in yesterday’s trading. This was supported by expectations of expanding stimulus in the Eurozone by the end of the year. The optimism also came from news that Greece reached an agreement with creditors for the next amount of aid. It is worth noting that stocks have been increasing for the second consecutive session. The probability of additional stimulus measures increased significantly after the terrorist attacks in France. In addition, stock markets were supported by the ZEW Economic Sentiment index in Germany, which surpassed analysts’ expectations. Today’s focus will be on the FOMC meeting minutes. Investors will try to understand how serious the committee is about raising interest rates at its meeting in December.
Resistance: 6270.57, 6344.60, 6421.70
Support: 6225.34, 6143.09, 6074.20
Quotes of precious metals continue to fall. Yesterday’s trading day was no exception. Such dynamics are caused by the strengthening of the US currency on expectations of upcoming monetary tightening by the US Federal Reserve. The market tries to price in such a move, which puts pressure on gold. Yesterday’s publication of the inflation report in the US, which showed a weak trend in consumer prices, also delivered some pressure. Recall that it was the low level of inflation that has led to FOMC’s decision to leave current monetary policy unchanged. The second reason why gold is under pressure is that there is no need for safe-haven assets these days. The publication of FOMC meeting minutes will have a significant impact on the dynamics of trading.
Resistance: 1073.98, 1085.03, 1102.70
Support: 1065.00, 1055.00, 1045.00