Daily Market Review — 19/11/2015
The Bank of Japan Interest Rate Decision Is the Day’s Main Event
Yesterday’s trading was influenced by expectations on the publication of the FOMC meeting minutes. All currency pairs containing the US dollar showed some sharp mixed swings before the publication. This was caused by the fact that some FOMC members have expressed concerns about the December rate hike. Therefore the FOMC members don’t have a united opinion on the timing of monetary policy tightening. The Bank of Japan announced its decision on the basic interest rate and the asset purchase program this morning. As it was predicted by most analysts, the Japanese regulator didn’t change the parameters of its monetary policy, because, according to most analysts, the Japanese economy is showing a moderate recovery. The Japanese currency has strengthened somewhat in the USD/JPY pair on this background. Today’s dynamics of trading will be influenced by data on the US labor market at 13:30 (GMT), as well as speeches of a few Fed officials later today.
Resistance: 123.76, 124.39, 125.00
Support: 123.07, 122.23, 121.48
The pair showed a confident upward trend yesterday. It received an impulse from a speech by a Bank of England representative, who noted that the medium-term outlook for inflation suggests a growth above 2% in 2016. Against this background, the British currency has strengthened considerably. Further on, the pair was influenced by the publication of the FOMC meeting minutes, which pushed the pair higher due to its “dovish” tone. Today market participants will closely follow the release of Retail Sales data in the UK, scheduled for 09:30 (GMT). Meanwhile, the GBP/USD can be significantly influenced by the US labor market report at 13:30 (GMT), as well as speeches of some members of the Fed.
Resistance: 1.5292, 1.5360, 1.5443
Support: 1.5185, 1.5145, 1.5090
During yesterday’s trading session, the major US stock indexes rose significantly after the publication of the FOMC meeting minutes. It says FOMC is ready and committed to tighten monetary policy at a meeting in December, if economic data that will be released before the meeting points to a steady growth of the US economy. Stock markets were somehow pressured by events in France, where the police continues to conduct anti-terrorist operation. Meanwhile, statistics on the US real estate market, published yesterday, pointed to a slowdown in the sector. Today’s focus of investors will be on US labor market reports at 13:30 (GMT). Market participants will also monitor speeches by some members of the US Federal Reserve. In general, the players expect some correction today after an impressive growth this week.
Resistance: 4674.37, 4698.51, 4728.79
Support: 4624.45, 4597.85, 4556.94
Light Sweet Crude Oil Futures
Quotes of “black gold” have reached a new multi-day low, by going to a level of $39.87 per barrel. Such dynamics were caused by concerns about oil oversupply in the world market. In addition, as reported by the US Department of Energy, crude oil inventories have increased last week by 0.25 million barrels against a forecasted level of 1.6 million. Meanwhile, investors are anticipating the OPEC meeting, scheduled for 4th December. As it became known yesterday, no five-year strategic plan will be adopted, though OPEC members will discuss current production quotas. The oil price was also pressured by reports that Saudi Arabia has increased its oil shipments. Most analysts predict that the price of “black gold” will remain low till the first half of 2016, due to oversupply in the world market.
Resistance: 41.44, 42.22, 43.54
Support: 39.87, 39.22, 38.50