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Monday, January 30th
Today the EUR/USD opened with a bullish gap, backed by broad greenback’s weakness. The USD remains heavily offered against basket of its main competitors in wake of US president’s protectionism, as D.Trump signed a document last Friday, banning entry into the US for 90 days from seven Islamic countries, explaining it as a fight against terrorism. Moreover, poor US GDP data, seen at the end of last week, are also collaborating with buck’s offered tone. However, currently the main currency pair is trading around 1.07 level, slipping lower its overnight highs, marked at 1.074 handle, as bears have taken a breather, allowing the dollar to regain part of its losses. Looking ahead, only data from the US housing market will be able to bring some impetus to the pair amid thin-trading conditions, as a part of Asian markets will remain closed due to Lunar New Year celebrations.
The dollar/yen pair has bounced off its overnight lows remaining positive on Monday morning. Seems that the pair has regained a smile as broad dollar’s sell-off, backed by Trump's travel ban order, is subsiding, allowing the pair to move away from this day lows, posted at 114.27 handle. However, most likely the pair will remain pressured during this day, as markets will keep up on digesting the latest news from the US political field. Adding to this, weaker tone around higher-yielding assets is also limiting pair’s upside traction, supporting yen’s safe-haven status. Now all focus shifts on US Pending Home Sales, while BoJ Interest Rate Decision, scheduled on the next Asian session, will take center stage.
The USD/CAD pair is extending it consolidative pattern into Europe, remaining in 20-pip flat corridor. By the time of writing the pair was trading at 1.3137 spot, as bears remain unable to benefit from greenback’s broad weakness. Moreover, softer tone around oil prices, seen at the start of this week, is negatively influencing the Loonie, also holding the pair within its range. Today the major will continue to follow global market’s sentiments, led by US dollar’s price dynamics, while data from US housing market will be able to provide investors with short-term trading opportunities in NA session.
The Kiwi sinks lower versus its American peer unable to hold its position. Currently the NZD/USD pair is keeping its southern course, refreshing daily lows at 0.7240 level despite better-than-expected NZ trade balance, seen in Asia. However, pair’s fall remains fragile, as markets continue digesting travel ban executed by the US President on Friday, weighing on the US currency. In the day ahead, the pair will continue floating influenced by US dollar’s price actions, while data from US economy, scheduled on NY session, will also have some impact on the pair.
The main events of the day:
US Pending Home Sales – 17.00 (GMT +2)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.0626 R. 1.0760
USDJPY S. 113.96 R. 115.92
GBPUSD S. 1.2465 R. 1.2645
USDCHF S. 0.9937 R. 1.0053
AUDUSD S. 0.7482 R. 0.7604
NZDUSD S. 0.7202 R. 0.7314
USDCAD S. 1.3055 R. 1.3199
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