Daily Market Review — 21/12/2015
German Statistics Will Be The Focus of Market Participants Today
The pair showed mixed trends on Friday, which was caused by the absence of important economic statistics that could influence the direction of the EUR/USD. At the same time, the US dollar was in demand, forcing the pair to fall somewhat. Meanwhile, prospects for the Euro against the US dollar remain negative because of the differences in monetary policy of two central banks. Today’s dynamics of the pair may be affected by the publication of the Producer Price Index in Germany, which is scheduled for 07:00 (GMT). Particular attention will be given to the Bundesbank Monthly Report, scheduled for 11:00 (GMT). It is worth noting that market participants will be preparing for tomorrow’s publication of US GDP in the final estimate for the third quarter.
Resistance: 1.0904, 1.0981, 1.1062
Support: 1.0802, 1.0690, 1.0557
The pair has updated the multi-month high of 71 during Friday’s trading. This was mainly caused by the continuing rapid fall of “black gold” quotations. Recall, the Russian economy is highly dependent on oil prices, as the export of raw materials accounts for lion’s share of the national budget revenues. If you look at the USD/RUB in terms of the monetary policies of the two central banks, the reason for such behavior becomes clear. Recall the US Federal Reserve raised its rate by 25 basis points at the last meeting. In contrast, the Bank of Russia decided not to change the parameters of monetary policy, leaving the key interest rate at 11%. It is possible that after a correction the Russian currency will again be under severe pressure.
Resistance: 70.9709, 72.1535, 73.3167
Support: 69.9973, 69.2668, 68.0710
Major US Stock Markets fell slightly during Friday’s trading, which was caused by a sell-off in commodity markets. This situation, in turn, was caused by the appreciation of the US currency after the rate hike by the Fed. In addition, the Services PMI was published on Friday in the US, and was worse than the average forecast of observers, pointing to a slowdown in this sector of the US economy. Falling oil prices continue putting pressure on Stock Markets.
Resistance: 4547.19, 4579.37, 4612.36
Support: 4502.39, 4471.59, 4447.81
Light Sweet Crude Oil Futures
In the first half of the trading day of Friday “black gold” quotations rose slightly, rebounding from multi-year lows, which was caused by technical factors. At the same time, the second half of the day was marked by new lows of $34.27 per barrel. Oversupply of oil, the volume of crude oil stocks in the US, the rate hike and the promise of the Iranian government to increase the supply of oil after the sanctions are lifted, continue to put pressure on quotations. Moreover, according to International Energy Agency forecasts, the price of oil will remain at a minimum in 2016, since there will be lower demand for oil and due to OPEC’s reluctance to cut production. Meanwhile, according to Baker Hughes, the number of drilling rigs last week in the United States remained unchanged.
Resistance: 36.07, 36.67, 37.51
Support: 34.27, 33.65, 33.00