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Thursday, November 24th
The dollar is showing extremely strong growth pace lately as US economy provides continuing support to its currency. Yesterday hawkish FOMC Meeting Minutes once again confirmed markets expectations of Fed’s hawkish interest rate decision, allowing the US dollar Index to break through its crucial resistance level of 102 and refresh its 13-years highs. Additionally, yesterday US economy beat market’s expectations with surprisingly strong report of Durable Goods Orders. Today US market will remain closed on the occasion of Thanksgiving Day. However, expectedly that demand for US dollar will continue to dominate across the market.
The euro had ended its recovery phase in Asia and fell to its nearly two-years lows on the back of mixed German GDP, released at the beginning of Europe. Moreover, yesterday’s more hawkish FOMC Meeting Minutes heated up already high expectations of this year Fed’s rate-hike, which in its turn have broadly boosted demand for the US dollar. Meanwhile, popular statistical agencies have shown that chances for a December Fed’s rate-hike now are approximately 95%. Today the euro will continue suffering from broadly based dollar’s strength however, it has all chances on minor recovery if investors decide to take profits off the table.
Seems that pound’s bulls are fighting hard for control over the GBP/USD pair. At the moment the pound continues to show steadiness above the level of 1.24 despite broadly based US dollar’s strength. Yesterday FOMC Statement once again reassured market participants that Fed’s rate-hike in December is a done deal thereby landing strong pressure on the pair. However, hawkish notes in UK’s Autumn Forecast Statement have given strength to the pound to resist dollar’s pressure. Today US market will remain closed due to celebrating Thanksgiving Day so markets will set up their focus on data released by UK economy.
Seems that the dollar/yen has broken out of its consolidative phase and now is eyeing on its yesterday’s highs posted after strong macroeconomic reports from US side. Yesterday the yen remained defenseless as Japanese market was closed due to the celebration of the national holiday, that became the reason for pair’s rally to its eight-month highs. Moreover, preliminary Japanese Manufacturing PMI released this morning also has shown downbeat results thereby limiting pair’s chances on immediate recovery. Today most likely the pair will remain under bullish control as strengthened USD positions coupled with continuing risk-on rally, boosted by overnight rise in oil prices, are strongly influencing the market.
The main events of the day:
US - Thanksgiving Day
German Ifo Business Climate Index – 11.00 (GMT +2)
GfK German Consumer Climate – 14.00 (GMT +2)
NZ Trade Balance – 23.45 (GMT +2)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.0456 R. 1.0690
USDJPY S. 109.98 R. 114.22
GBPUSD S. 1.2313 R. 1.2531
USDCHF S. 1.0057 R. 1.0237
AUDUSD S. 0.7329 R. 0.7473
NZDUSD S. 0.6940 R. 0.7112
USDCAD S. 1.3382 R. 1.3568
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