Daily Market Review — 31/03/2016
European economic statistics to set the tone for markets today
The US currency stays under pressure on a broad spectrum of the market after the Fed Chair Janet Yellen’s statements. During her speech at the Economic Club of New York, once again she pointed to challenges in the global economy, which could have a negative impact on the US economy. In addition, she pointed that at the moment, the conditions for a rate hike are worse than in December 2015. She repeated the idea that the regulator will approach the issue of raising rates more subdued. However, support for the pair provided better-than-expected data on CPI in Germany. On the other hand, some pressure put statistics on the US labor market. Thus, according to ADP the number of employees was 200 thousand against the average forecast at 194 thousand. Today, there will be important data on German labor market and inflation in the Eurozone, which will be presented at 07:55 (GMT) and 09:00 (GMT), respectively. Also, some impact on the pair’s dynamics may have US labor market data, which traditionally will be published in at 12:30 (GMT). Meanwhile, market participants will prepare for tomorrow’s NFP.
Resistance: 1.1363, 1.1440, 1.1539
Support: 1.1296, 1.1215, 1.1142
British Pound came under pressure again after weeks of growth. This is due to the high Brexit probability after the recent events in Brussels, and in such situation, it is hard to predict Bank of England’s action. The bank may cut interest rates to support the national economy and improve rates in order to avoid an excessive reduction in price of the pound in case of Brexit. Today, the dynamics of the pair will depend on U.K. Mortgage Lending statistic, as well as final data on UK GDP for the fourth quarter of last year, which will be published at 08:30 (GMT). In addition, today at 12:30 (GMT) will be traditionally published data on the US labor market.
Resistance: 1.4363, 1.4408, 1.4459
Support: 1.4315, 1.4259, 1.4196
Major US stock indices rose slightly yesterday. Fed chief Janet Yellen’s statements continue to provide the support for stock markets. She sad that rates hike question needs careful approach. In addition, some support provided data on the US labor market, which showed the strength of the economy sector. However, further growth of stock exchanges was stopped by the renewed drop in oil prices after the publication of crude oil inventories data, which showed a significant growth. The near future investors will pay attention NFP report, which will be published tomorrow at 12:30 (GMT).
Resistance: 4492.80, 4510.35, 4529.80
Support: 4456.24, 4440.16, 4425.05
Prices for precious metals fell yesterday, which was due to the strengthening of the US currency after the publication of ADP nonfarm employment change. Thus, the number of employees has grown to 200 million (forecast said 194 million). This report is not an official government report; however, it gives an idea of the hiring in the private sector of the US economy. Today, the dynamics of trade will depend on the publication of another report, the US labor market – the number of initial jobless claims, which will be presented at 12:30 (GMT). Meanwhile, investors will expect for tomorrow’s NFP report.
Resistance: 1230.80, 1236.89, 1243.89
Support: 1222.79, 1215.11, 1208.21