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Wednesday, January 3rd
The EUR/USD pair extends retreat from its highs, which were last seen in September 2017, on the back of pause in sell-off of the US dollar. However, further pair’s retreat may appear limited as market players are awaiting FOMC Minutes for fresh clues on further Fed monetary policy projections. Moreover, persisting weakens of the greenback remains a key driving factor across the market, thus limiting pair’s chances of further sharp downside correction. Besides FOMC meeting minutes, investors today will also pay attention to German unemployment data and US ISM Manufacturing PMI, which will also help the pair to from its further trajectory during this trading session.
The GBP/USD pair seems lost its positive traction at European opening and stepped away from its September 2017 highs, marked at 1.3613 this morning. Recent retreat of the pair is mainly explained by attempts of the US dollar to recover its positions against its main competitors. Adding to this, lack of information about Brexit may also add some bearish pressure to the pound, thus contributing to pair’s recent downside correction. Now all traders attentions shifts towards the UK Construction PMI and US ISM Manufacturing PMI numbers, while the release of the FOMC meeting minutes remains the main event of this Wednesday, as it might contain so some important information regarding Fed monetary policy plans for this year.
The USD/JPY pair regained some positions this Wednesday, however, remaining within striking distance of its 2-week lows, marked in the vicinity of 112.00 a day before. There was now clear catalysts for the latest pair’s dynamics, except ongoing weakness of the US dollar. Moreover, expected that the pair will keep its offered tone in near future, as upcoming Fed minutes and NFP bring some cautiousness among investors, thus supporting safe-haven assets, such as the yen. Today, besides the FOMC meeting minute, investors will also pay attention to the ISM manufacturing PMI data, which will be published during the NA session and will be able to bring some fresh trading opportunities.
Bitcoin recovered some ground at the start of this year. The BTC/USD pair finally climbed back above the level of 15,000.00, gaining about 15% for the last 24 hours. The latest upside rally of crypto assets is mainly attributed to the renewed buying pressure after New Year holiday. Moreover, inflow of investments from large investors also played an important role in shaping the bullish trend of Bitcoin, so, according to the latest news headlines, the fund, managed by one of the co-founders of the PayPal payment system Peter Thiel, invested about 20 million US dollars in Bitcoin. By the moment of writing, the price for the world’s largest cryptocurrency was 15,362.00 US dollars, while its market capitalization was $258 billion, according to data from coinmarketcap.com.
Major events of the day:
German Unemployment Change – 10.55 (GMT +2)
UK Construction PMI – 11.30 (GMT +2)
US ISM Manufacturing PMI – 17.00 (GMT +2)
FOMC Meeting Minutes – 21.00 (GMT +2)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.1961 R. 1.2129
USDJPY S. 111.63 R. 113.11
GBPUSD S. 1.3462 R. 1.3666
USDCHF S. 0.9671 R. 0.9771
AUDUSD S. 0.7768 R. 0.7874
NZDUSD S. 0.7022 R. 0.7170
USDCAD S. 1.2453 R. 1.2603
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