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Wednesday, January 25th
The GBP/USD pair regained most part of its losses after recent drop, however, now is easing from its overnight highs. Yesterday the pair came under bearish pressure after UK Supreme Court’s verdict on Brexit that came with 8 to 3 votes in favor of Parliament's approval before triggering Article 50. So now investors will await for Parliament’s vote, however, the Parliament has already stated that will support Brexit process. Yesterday the pair managed to recover its losses, as investors are doubting “hard Brexit” scenario, adding some buying interest around the Sterling. Nothing much is scheduled in data calendar for the pair, as only BoE Governor M.Carney will deliver his speech later in the day.
The Aussie remains under strong selling pressure, forcing the AUD/USD pair to drop to its daily lows on the back of weak inflation data. This morning Australian CPI on a quarter basis showed disappointing results, dragging the pair away from the region of its 2-month highs, located near the level of 0.76. Poor data from Australian economy triggered talks among market’s participants of further monetary easing by the RBA, while the Fed took a course on rising its interest rate during this year. Such divergence between tow policies attracted additional pressure on the Australian currency. Looking in the day ahead, only weekly EIA report of US Crude Oil Inventories will be able to bring some impetus to the pair, so the major will continue to follow global markets sentiments during this trading session.
The greenback has recovered its positions against its main competitors, sending the EUR/USD pair to refresh its daily lows at 1.0711 spot. After brief consolidation period, seen in Asia, the pair once again came under bearish pressure, as the US dollar has regained a smile. Moreover, seems that market’s participants have already digested recent D.Trump’s talks, and hopes return, that new US president will fulfill his promises, broadly supporting the buck. Now all focus shifts on German Ifo Business Climate Index that will be released in European session. Nothing else is scheduled in today’s docket, so investors will keep eyeing on developments surrounding main news sources to determine pair’s further direction.
The USD/CAD corrects higher from its daily lows, however, remaining on a 3-day losing streak. Yesterday the pair fell for almost 2 cents after disappointing results from US housing market, refreshing its weekly lows at 1.3106 level. However, the major has picked up some bearish momentum, performing minor correction moves, as renewed demand for the greenback is pushing the major in north direction. But on the other hand, stabilized oil prices after API report that showed increase in crude oil stocks, are lending extra support to the Loonie. Currently the pair is trading at 1.3152 level, awaiting for Crude Oil Inventories that will be released in American morning for fresh impetus.
The main events of the day:
German Ifo Business Climate – 11.00 (GMT +2)
US Crude Oil Inventories – 17.30 (GMT +2)
BoE Governor M.Carney’s speech – 18.00 (GMT +2)
NZ CPI – 23.45 (GMT +2)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.0687 R. 1.0797
USDJPY S. 112.02 R.114.78
GBPUSD S. 1.2367 R. 1.2619
USDCHF S. 0.9933 R. 1.0055
AUDUSD S. 0.7525 R. 0.7635
NZDUSD S. 0.7175 R. 0.7311
USDCAD S. 1.2993 R. 1.3379
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