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Thursday, January 26th
Brexit developments continue to direct the market lately, sending the GBP/USD to refresh its 6-week highs at 1.2662. Yesterday the pair regained its positive mood and was remaining bullish during Asia, as UK PM T.May announced that she would publish the bill to trigger article 50 already this Thursday. Moreover, May’s confidence and determination especially after her comments that “Brexit means Brexit” are also positively influencing the pound. Today all traders’ attention will be focused on fresh information regarding Brexit process, while UK flash GDP report and data from the US housing market will also have significant impact on the pair.
The Kiwi got a major boost in early Asia following strong NZ inflation reports, pushing the NZD/USD pair to refresh its 2-1/2 month highs above the level of 0.73. During Asian session NZ economy surprised market’s participants with better-than-expected CPI, triggering fresh talks of further rate increase by the RBNZ. However, the pair failed in holding its gains and fell to the region of 0.7270, as the Kiwi remains overbought after pair’s northern march during last month from its lows, located at 0.6850. Now immediate focus shifts toward US economic reports due to be released later in NA session.
The EUR/USD remains bearish this morning, stepping away from its overnight highs marked at 1.0765. Today the US dollar stays better bid against the euro, as renewed optimism around the greenback, led by D.Trump’s presidency, is negatively influencing the main currency pair. However, uncertainty around new president’s further political steps still persists, so US dollar’s bullishness remains fragile. As for today, USD dynamics will remain as a key driver for the pair, while US macro data will also be able to bring some trading opportunities in short-term perspective.
Today the USD/JPY pair is trading in positive mood, stepping away from its overnight lows, posted at 113.05. Currently the pair is accelerating its recovery and by the time of writing has reached the level of 113.80, as the greenback corrects higher against its main competitors this morning. Moreover, better tone amid higher-yielding assets is also collaborating with pair’s sharp upsurge. However, lack of details on US president’s fiscal stimulus plans remains one of the major US dollar’s fears that can crash greenback’s positions instantly. Today only couple of US macro releases could be able to bring some impetus to the pair, so US price dynamics and RO-RO trend will continue to set up pair’s direction during this trading session.
The main events of the day:
UK prelim. GDP – 11.30 (GMT +2)
US New Home Sales – 17.00 (GMT +2)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.0684 R. 1.0800
USDJPY S. 112.48 R. 114.38
GBPUSD S. 1.2438 R. 1.2734
USDCHF S. 0.9935 R. 1.0053
AUDUSD S. 0.7478 R. 0.7646
NZDUSD S. 0.7192 R. 0.7358
USDCAD S. 1.2995 R. 1.3199
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