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Monday, November 21st
The ongoing speculations around upcoming OPEC meeting, where agreement between countries oil exporters about crude oil output freeze could be reached continue to drive the market. Moreover, over the weekend President of the Russian Federation V.Putin stated that there is high probability that OPEC members will reach an agreement on oil output issue as Russia is ready to freeze its oil production at current level. Also V.Putin has noted in his comments that main contradictions among OPEC members, if they still exist, could be eliminated during OPEC meeting. After the statement of Russian President, the oil prices, opened with bullish gap, are lending support to commodity-linked currencies such as Canadian and Australian dollars.
The Japanese currency remains extremely weak at the start of this week against its American counterpart and now is wobbling near multi-month highs in 111.00 region. The USD/JPY pair was supported this morning after Japanese trade balance has reflected the sudden sharp drop in export and import figures of October. Moreover, fresh wave of risk-on moods approached the market this morning on the back of renewed rally seen in oil prices. Today in absence of significant economic reports from both sides the pair will continue to be driven by risk trends and USD dynamic.
Currently the EUR/USD pair is looking in north direction retreating from its 11-month lows marked at 1.0600 level. The pair is performing minor correction actions after two-week down sided rally. However, expectedly the major will continue trading in bearish trend in mid-term perspective as ongoing talks that the Fed will raise its interest rate by the end of this year and further D.Trump’s monetary policy stimulus that will boost US inflation growth rate continue supporting US currency. Nothing much is scheduled for this Monday as only ECB President M.Draghi with his speech will provide some impetus to the pair.
The USD is trading defensive against its major peers at the start of this week as traders are taking profits off the table after dollar’s rally seen last week. The US Dollar Index reached the highest level since 2003 year at the end of the last week as Fed’s rate-hike is considered as a done deal, with J.Yellen’s last week’s comments that have additionally fueled markets expectations of the hawkish Fed’s move. Current probability of the rate increasing scenario is 95%. Today US economy calendar remains silent with the only speech of FOMC member S.Fisher that could provide the US dollar with fresh impetus during this Monday.
The main events of the day:
FOMC Member S.Fischer’s Speech– 15.00 (GMT +2)
ECB President M.Draghi’s Speech – 18.00 (GMT +2)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.0527 R. 1.0673
USDJPY S.109.40 R. 111.70
GBPUSD S. 1.2227 R. 1.2497
USDCHF S. 1.0030 R. 1.0156
AUDUSD S. 0.7273 R. 0.7447
NZDUSD S. 0.6963 R. 0.7081
USDCAD S. 1.3445 R. 1.3591
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