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Markets witness low volatility on a thin trading day as the US respects Martin Luther King Jr. Day. Investors continue to trade cautiously ahead of the eventful week. Central bank officials are set to speak at the World Economic Forum Annual Meetings in Davos, Switzerland. Investors fuel expectations of a BoJ policy tweak ahead of the BoJ meeting on Wednesday.
AUDUSD trimmed Asian session gains from a five-month high and steadied below the 0.7000 psychological level. Lower Inflation data from the US fuelled bets of a less aggressive Fed on their next meeting. There is not much activity in the US as they are observing the Martin Luther King JNR Holiday. The pair was down -0.11% as bulls face 0.7050 as near-term resistance.
NZDJPY firmed up in the European trading session gaining +0.63% as the Yen holds lower ground. Expectations ramped up that the BoJ may further tweak its policy or abandon fully its yield control policy following the 10-year yield breach of the 0.5% BoJ ceiling. This however failed to lift the Yen against its rivals. The re-opening of Chinese borders continues to boost the NZD in the short term. The pair`s bulls took over from the 81.50 intraday low and a number above 84.00 may be key for a bullish run.
GBPCAD traded -0.11% lower ahead of BoE Governor Bailey’s speech. Recession fears continue to weigh on the sterling ahead of jobs data on Tuesday. Manufacturing sales in Canada are surveyed to have declined in November to 0.5% from 2.8%. Traders will be anticipating the Bank of Canada’s Business Outlook Survey later in the day. The pair is currently capped by 1.6400 as bears slide toward 1.6320-1.6300
European stocks were mixed ahead of BoE Bailey’s speech. FTSE100 was steady at -0.01% after closing above the 7800 level on Friday. A hold above that level, bulls could attempt a rally above the 7900 psychological level. CAC40 rose by +0.16% as bulls find momentum above the 7000 previous resistance and 7200 remains a near-term challenge. DAX trimmed gains by -0.18% as bulls hovered above the 15000 psychological level. Upside gains are challenged by the 15200 and 15500 levels.
US stock futures took a breather as markets observe Martin Luther King Jr Day. US 500 futures were down -0.28% as the 4000 level, near-term resistance continues to hold. On the downside, 3900 remains a key support level. US100 futures plunged by -0.41% from the 11500 level and a break below the 11200 could trigger short-term selling pressure towards the 11000. US30 futures were down by -0.17% and key levels to watch out for are 34400 resistance and 34000 support.
Oil markets trimmed Friday’s gains as the dollar regains strength ahead of key events. USWTI crude oil futures were down -0.48% from the 80.00 level and the next key support is at the 78.00 level. Brent Crude oil lost -0.46% and 86.00 remains a near-term resistance while 84.00 is a key support level.
