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Investors cautiously await the ECB monetary policy release in the early New York Session. The ECB is set to hike its rates to the highest in a decade in a bid to curb soaring inflation. ECB Press Conference and President Lagarde’s speech will be key events of the day. The dollar reassumed strength ahead of the US GDP data, Core Durable goods and Initial Jobless Claims. BoE Deputy Governor Woods is set to speak later in the day.
CADJPY slumped by -0.33% in the aftermath of the disappointing BoC rate decision. On Wednesday, the BoC raised its key rates by 50 bps ruling out the expected 75bps. The less aggressiveness weighed on the CAD against the Yen. The Yen gained some ground ahead of the BoJ rate decision on Friday as markets price in a possible tweak by the BoJ. The pair continued its fall from 108.00 intraday resistance and bears may face a challenge at 106.80 and 106.20.
The EUR has reversed its 5-day winning streak against the USD by -0.48% ahead of the ECB rate decision. Expectations have settled at a 75 basis points hike by the ECB from 1.25% to 2.00%. The dollar firmed up on Thursday as Q3 GDP is expected to soar to 2.4% from -0.6% of the 2nd quarter. A hawkish ECB may open the way for bulls’ recovery to an immediate high at 1.0400 otherwise bears may reclaim parity. Along with the Q3 GDP are Core Durable Goods Orders and Initial Jobless Claims in the US economic docket.
AUDNZD lost -0.18% on Thursday ahead of Australia’s PPI data. The Australian Q3 Export price index fell to -3.6% from a previous reading of 10.1% while the import price index fell from 4.3% to 3.0% undermining Australian dollar strength. The AUDNZD was trading inside a range between 1.1150 high and 1.1100 support as both suffer from slowing demand. From New Zealand, Traders are expecting ANZ Business Confidence Data for October early Friday morning.
European stocks were mixed on Thursday as investors await the ECB policy meeting. FTSE100 rallied by +0.62% breaking above the 7050 near-term resistance, although upside gains are capped by the 7100 level. DAX dropped by -0.63% after bulls retracted from the 13200 near-term resistance. However, critical levels to watch out for are the 13000-support level and 13400 resistance level. CAC40 slumped by -0.55% as the 6280 level holds as an immediate barrier and the index could trade back to 6150, a previous resistance-turned-support.
US stock futures slipped as traders digest earnings, Apple, and Amazon reporting today. S&P500 futures traded lower by -0.28% from a near-term resistance at the 3850 level as bulls fail to claim the 3900 level. Nasdaq100 futures slumped by -0.65% after breaking below the 11400 level and bears could target 11000 if the 11300 level fails to hold. DJIA index held steady gains at +0.12% although upside gains are capped by the 32000 near-term. A break above that level could cause a further rally towards the 32500, however, bears could look for the 31000 if 31700 is breached.
Oil was steady on Thursday as renewed demand concerns were triggered after US Crude oil inventories and API Weekly Crude oil stock rose. USWTI crude oil futures were up by +0.16% after bouncing off the 87.50 level and bulls could target the 93.50 level in the near term. Brent crude edged higher by +0.11% as bulls target the 98.80 level after bulls defended the 93.20, intraday support.
