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Tuesday, November 22nd
And another natural disaster hits Asia but this time earthquake strikes Japanese region near Fukushima nuclear power station. Japanese officials have already calmed down the community noting that there is no danger of radiation leak and the government is ready to deal with any consequences done by nature. Moreover, the Japan Meteorological Agency has also calmed nervousness among investors stating that there is no danger of tsunami caused by earthquake. Reacting on situation in Japan the USD/JPY pair has dropped to 110.27 level as immediately shrank risk sentiments have supported the yen. However, the major has recovered the ground and now is trading back above the level of 111.00 mostly directed by global markets sentiments. With absolutely empty data calendar of Japan the USD/JPY pair today will keep following global risk sentiments and USD dynamic until NA session, when US economy will release housing market data.
After short break in risk-on rally triggered by the latest news from Japan, the market is back to normal driven by extending risk appetite seen lately. Heated interest to higher-yielding assets is majorly based on the higher commodity prices boosted by recent talks of agreement between OPEC members that could be reached on the next OPEC meeting. Meanwhile, the prevalent risk-on sentiments are strongly influencing safe-haven currencies such as yen and franc. The Japanese yen currently is trading in the region of 111.00 level last seen in June and the Swiss franc is still wobbling near its 1.01 resistance level that was witnessed last time in February, 2016.
The euro/dollar pair is still trading in the red zone retreating from its overnight highs posted at mid-1.06 level. Yesterday the euro came under another selling pressure after ECB President M.Draghi has stated that CB is ready to implement another easing stimulus of the monetary policy whenever it is required. Moreover, ongoing risk appetite is also negatively influencing the euro lately limiting its recovery. Today the EUR/USD will keep trading under bearish pressure as prevailing demand for US currency is still gripping the market.
Seems that the pound is consolidating its recovery and now is trading near its overnight highs marked at 1.2512. Yesterday Prime-minister of UK T.May stated that UK government will do their best to avoid “hard Brexit” thereby strongly boosting the pound. Today the GBP/USD pair will keep trading pressured from both sides as prevalent risk-on sentiments are supporting the pound and on the other hand broadly strengthened US dollar’s positions are limiting pair’s upside traction.
The main events of the day:
CAD Core Retail Sales – 15.30 (GMT +2)
US Existing Home Sales – 17.00 (GMT +2)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.0547 R. 1.0689
USDJPY S. 109.97 R. 111.79
GBPUSD S. 1.2239 R. 1.2637
USDCHF S. 1.0050 R. 1.0134
AUDUSD S. 0.7283 R. 0.7423
NZDUSD S. 0.6947 R. 0.7135
USDCAD S. 1.3311 R. 1.3567
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