Daily Market Review — 25/11/2015
US Statistics Will Be the Focus of Market Participants Today
The pair traded yesterday in a moderate upward direction, driven by positive statistics on GDP data from Germany and the German IFO Current Conditions report. Both the first and the second indicator have fully met the expectations of analysts, with the IFO Institute data showing strong growth. Despite positive statistics on the US GDP, which exceeded analysts’ expectations, the US currency continued to fall against the euro. Such dynamics were caused by the closing of some long positions on the US dollar on the eve of Thanksgiving, a public holiday in United States. Today promises to be overwhelmed by economic statistics from United States. At 13:30 (GMT) the Personal Income and Spending index will be released. This is the price index for personal consumption expenditures and it’s the Fed’s key indicator for inflationary pressure in the economy. There are a few more statistics, scheduled at the same time: Initial Jobless Claims and Durable Goods Orders. Later on, at 15:00 (GMT), the Reuters/Michigan Consumer Sentiment Index and New Home Sales will be published. In short, today’s dynamics of the pair will completely depend on US data.
Resistance: 1.0676, 1.0762, 1.0829
Support: 1.0592, 1.0522, 1.0463
In yesterday’s trading the pair showed a clear negative trend. It was caused, first of all, by speeches of a number of representatives from the Bank of England. The head of the British regulator, Mark Carney, while speaking to the parliament, said that interest rates will remain at their current minimum levels for some time. Other representatives noted that the risks to the UK economy shifted to the negative side, and could trigger a further drop in rates. Meanwhile, almost all members of the Governing Council of the Bank of England are concerned about the low inflation level and disappointing wage growth. All these facts indicate that the British regulator is not likely to rush the tightening of monetary policy. Today’s dynamics of the GBP/USD may be affected by the publication of data on Mortgage Approvals and Applications in the UK at 09:30 (GMT). The Autumn Forecast Statement of the UK Treasury will be published at 12:30 (GMT). However, the main impact will be delivered by US data, a large portion of which will be released starting from 13:30 (GMT).
Resistance: 1.5153, 1.5247, 1.5333
Support: 1.5052, 1.4955, 1.4857
Major US stock indexes closed yesterday’s trading in the green zone, despite the losses incurred in the first half of the day. The fall was caused by reports that the Turkish Air Force downed a Russian military aircraft that could escalate an already tense situation in the Middle East. Later on, in the second half of the day, the US GDP data for the third quarter was released. This indicator showed strong growth, beating analyst forecasts. Today’s dynamics of the US stock markets will be affected by data on the US economy. A huge number of statistics will be published starting from 13:30 (GMT). In addition, investors will be cautious ahead of Thanksgiving Day, a public holiday.
Resistance: 2093.00, 2104.26, 2109.09
Support: 2075.96, 2064.23, 2044.56
Light Sweet Crude Oil Futures
Quotes of the “black gold” rose yesterday above $42 a barrel amid worsening situation in the Middle East as a Russian warplane was shot down near the Syrian border. This development can cause problems for the oil supply from the region, which accounts for about 35% of the global output. Further escalation of the conflict could cause oil prices to reach new yearly highs. Meanwhile, API released yesterday its report on Crude Oil Inventories, which showed an increase by 2.6 million barrels. But this message only had a short-term pressure on oil prices. Today investors’ attention will be drawn to the weekly report on inventories from the US Department of Energy, to be published at 15:30 (GMT). It is worth noting that the oil market has shown volatility recently amid uncertainties related to the OPEC meeting on December 4th and the conflict in Syria.
Resistance: 43.42, 45.05, 46.19
Support: 42.40, 41.35, 40.40