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Friday, November 24th
The EUR/USD pair consolidates its recent bullish rally in the vicinity of 1.1850 level at the last trading session of the week. The pair remains positive for the fourth session in a row, despite attempts of the US dollar to correct after its significant drawdown, triggered by dovish FOMC minutes on Wednesday. The main reason of pair’s positive mood remains the fact that concern about the political situation in Germany was somewhat eased. On the other side, the market barely reacted on yesterday’s ECB minutes, which showed that ECB members are not yet ready to name the exact end date of the QE program. Now immediate focus shifts toward German Ifo business surveys, which will remain the only important release of this day, so the pair will continue to follow broad market trend to determine its further trajectory.
The GBP/USD pair failed to sustain its positions above the level of 1.33 in Asia, having eased part of its weekly gains. The main reason of pair’s retreat remains attempts of the US dollar to correct positions against its main competitors after disappointing FOMC minutes, seen on Wednesday. Adding to this, prevalent risk-off sentiments exert some pressure on the higher-yielding GBP that is also contributing to pair’s retreat. However, further downside of the pair seems limited amid thin market conditions due to Thanksgiving lull on the US market. Looking ahead, today we have pretty quiet trading session, as only secondary data reports will be released from both sides, so the US dollar price dynamics and broad market trend will remain as key driving factors for the pair at the end of this working week.
The USD/JPY pair finally came out of its consolidation phase and stepped away from the region of its 2-month lows, reached on Wednesday near the level of 111.00. Recall, earlier this week the greenback slumped sharply across the board after dovish FOMC minutes showed concerns of Fed members regarding weaker inflation growth pace. However, seems that US bears took a breather today, allowing the dollar to correct higher after its drawdown, eventually exerting support to USD/JPY. On the other hand, further upside looks capped, as better demand for safety and low trading volumes are lending some negative pressure on the pair. Today in absence of any market-moving events, the US dollar dynamics will remain as an exclusive determinant for the pair throughout this trading session.
The NZD/USD pair came under selling pressure at the last trading session of this week, retreating from its weekly highs, marked near the level of 0.6900 on Thursday, after disappointing data, provided by the NZ economy. In early Asia, the NZ published weaker-than-expected trade balance data, which was the main catalyst for pair’s decline. Adding this, broad US dollar correction against its main peers and prevalent risk aversion also contributes to pair’s retreat lately. In the session ahead, the US economy will publish only secondary data reports, which most likely won’t cause any sharp reaction amid investors, so US dollar price actions will act as an exclusive driver for the pair on the last trading day of the week.
The main events of the day:
United States - The Day After Thanksgiving
German Ifo Business Climate Index – 11.00 (GMT +2)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.1796 R. 1.1882
USDJPY S. 110.90 R. 111.52
GBPUSD S. 1.3251 R. 1.3363
USDCHF S. 0.9778 R. 0.9844
AUDUSD S. 0.7586 R. 0.7656
NZDUSD S. 0.6847 R. 0.6925
USDCAD S. 1.2652 R. 1.2756
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