Daily Market Review — 28/01/2016
U.K GDP and US Statistics the Main Events Today
The pair showed negative dynamics during yesterday’s session. This was due to positive US statistics, particularly data of new home sales. The number of new single-family homes that were sold during the previous month rose to 544,000 (forecast −500,000). Also, the Fed interest rate decision influenced the marked. The US regulator upheld the parameters of the current monetary policy, as expected. However, the Fed has made it clear that does not rule out further rate hikes during the current year. Further steps will depend on incoming economic data. In general, the FOMC statement was quite positive for the dollar. The main topic was the slowing down of growth in the world economy. Today, the dynamics of the pair will seriously depend on publication of the U.K GDP for the fourth quarter of last year,at 09:30 (GMT). Also, pay attention to the publication of data on the US labor market and durable goods orders, to be held at 13:30 (GMT).
Resistance: 1.4341, 1.4477, 1.4601
Support: 1.4174, 1.4082, 1.3955
Yesterday the Japanese currency fell significantly against the US dollar, due to increased demand for the US currency after US treasuries rose. Meanwhile, the publication of US new home sales, which came out much better than the average forecast of experts, supported the dollar. However, the FOMC statement put some downward pressure on the pair. Gradually the attention of market participants switched to a meeting of the Bank of Japan, the results of which will be known tomorrow. The market widely expects expansion of stimulus measures by the Japanese regulator that will put pressure on the Japanese currency. Meanwhile, today the dynamics of the pair may also be affected by the publication of US labor market data and Durable goods orders at13:30 (GMT).
Resistance: 119.06, 119.69, 120.32
Support: 118.38, 117.65, 117.00
Major stock markets closed in the red yesterday due to the Fed interest rate decision. In their statement they talked about the global market turbulence and the negative consequences for the US economy. Nevertheless, the US regulator is not excluding the possibility of a rate hike at the meeting in March. Apple’s quarterly report put strong pressure on the US stock markets with shares fell more than 6%. Meanwhile, oil is showing some support for the stock markets, coming in above the level of $322 per barrel. Today, investors should pay attention to Durable goods orders’ data and the data on the US labor market, which will be published at 13:30 (GMT).
Resistance: 15977.21, 16143.59, 16390.49
Support: 15767.88, 15554.06, 15404.18
Light Sweet Crude Oil Futures
Quotes of “black gold” significantly rose during yesterday’s session, returning to the level of $32 per barrel. It was due to a cold snap in the US and Europe that led to the demand for oil. The statistics on oil reserves from the US Department of Energy, which pointed to significant growth, also helped the market. Nevertheless, the market has already priced in an increase in inventories after the publication of a similar report from the US Institute of Petroleum. Meanwhile, the Iraqi Oil Minister’s speech supported the market. He said that his country is ready for an extraordinary OPEC meeting, called for by Venezuela. Also, he stressed that Iraq is ready to consider a reduction in production, provided that other countries also cut production. This primarily applies to countries that are not OPEC members. Along with this, oil quotes continue to remain under pressure due to the significant imbalance in the global market.
Resistance: 32.78, 34.31, 35.56
Support: 31.28, 29.34, 27.53