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The US Dollar maintained a steady outlook following hawkish FOMC Meeting Minutes. The Fed warned investors that the fight against inflation remains a priority boosting the dollar in the near term. The UK Purchasing Managers Index suggests that their activity is still in contract putting pressure on the Pound in the near term. Investors shifted their focus to the US Jobless claims along with FOMC members Bostic and Bullard later in the New York session.
EURGBP was up +0.31% following mixed data from the eurozone area. In Germany, the November trade balance jumped to 10.8B from 6.9B in the previous month. Italian CPI [MoM] came in at 0.3% against the anticipated 0.1% while eurozone PPI was at 27.1% vs 27.5%. On the other hand, the UK Composite PMI printed a 49.0 vs 49.0 while the Services PMI printed a 49.9 50.0 showing a possibility of an ongoing recession in the country. Traders anticipate the euro area CPI data for further clarity on the direction of inflation. The pair bounced off 0.8780, trimming losses of a 2-day slump. A number above 0.8876 is key for a bullish rally.
USDCAD gained +0.18% as bulls took over after a significant drop from 1.3680 to 1.3474 on Wednesday. The USDCAD recovered modestly despite an uptick in oil prices on the day. Later in the New York session, the US ADP Nonfarm Employment Change will be due and is expected to be 23K more than the previous 127K of the previous month. This along with Initial Jobless claims and Crude oil Inventories will be highly anticipated by investors. To the upside, bulls may reclaim 1.3580 and 1.3700 while bears may seek to retest 1.3450.
NZDJPY was trading flat at +0.03% as the pair recovered early European session losses. The NZD gained support from China’s move to relax restrictions on Australian coal exports which happens to be New Zealand’s biggest trade partner. The Japanese Yen gave in gains as the currency becomes less attractive to borrowers as yields trade beyond the BoJ JGB limit. The pair’s bulls may be capped by 84.00 while bears may seek 82.20 in the near term.
European Stocks mixed as investors digest Fed meeting minutes along with disappointing German Trade Data. FTSE100 rallied by +0.62% despite struggling to hold gains above the 7600 resistance. However, a break above that level could trigger further buying towards the 7700 high, a 3-year high. CAC40 was slightly down by -0.29% as bulls retract from the 6800 resistance and downside pressure is held by the 6700 level. DAX was steady at -0.07% as bulls remain range bound between the 14500 resistance and 14250 near-term low.
US stock futures were steady on Chinese optimism ahead of FOMC speakers’ speeches. S&P500 was up +0.11% as the index traded between the 3900 resistance and 3850 support level. Nasdaq100 futures added +0.14% as bulls attempt to retake the 11000 level. On the downside, the 10750 remains a critical support. DJIA index futures edged up by +0.08% and key levels to watch are the 33500 resistance and 33000 psychological level.
In commodities, oil markets experienced a relief rally after 2-days of losses. Investors are optimistic ahead of US Crude Oil inventories data scheduled for release in the New York session. The US WTI crude oil futures rose by +2.00% as bulls found near-term support at the 73.00 level and upside gains were capped by 75.00, an immediate resistance level. Brent Crude oil stocks advanced by +2.21% after bouncing off the 78.00 and a break above the 80.00 level could strengthen bullish appetite in the near term.
