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Thursday, January 11th
The EUR/USD pair remains defensive this Thursday, having lost the most part of its recent gains. Yesterday the major currency pair received strong bullish impetus, braking through the resistance level of 1.2000, in wake of sharp drop of the US dollar across the market, triggered by Chinese headlines. The Chinese officials stated that they are considering to slow purchases of the US Treasuries. However, the greenback managed to regain its positive tone on the back of fresh market talks that China’s reduction of the US Treasuries purchases could be interpreted incorrectly. Adding to this, yesterday’s hawkish comments of Fed members, indicating another three rate hikes this year, provide extra support to the greenback today. Now all traders’ attention shifts towards ECB minutes, which may contain some fresh information regarding regulator’s further projections regarding its monetary policy. Also, the US will publish today the PPI report and several second-tier data, which will also help the pair to form its further trajectory.
The GBP/USD pair remains better offered at the second half of this week, continuing to drift to the negative territory for the third day in a row. Seems that Brexit fears continue to spook the market that is the key reason of the latest weakness of the pound. Ongoing debates between the EU and UK on trade deal are still failing to show any results, which potentially threatens the UK industrial sector. Moreover, ongoing recovery of the US dollar after its yesterday’s retreat, provoked by Chinese talks, also collaborates with recent retreat of the pair. Looking ahead, today the UK data calendar won’t bring us anything noteworthy, while the US will publish the PPI report, which will be able to spark some volatility during the NA session.
The AUD/USD pair stalled its previous bullish run and now is consolidating its positions near the level of 0.7870. Earlier today, the pair received notable bullish impetus, having refreshed its 3-month tops at 0.7890 spot, on the back of encouraging Australian retail sales numbers, which boosted demand for the Aussie across the market. However, further growth of the pair looks unlikely, as correction of the US dollar after its yesterday’s brief drawdown exerts negative influence on AUD/USD. On the data front, today all investors’ attention will remain focused on the US PPI report, while broad US dollar dynamics will continue to navigate the pair this Thursday.
Bitcoin continues to lose points this week. The BTC/USD pair extends its downside trend for the fourth consecutive day on the back of ongoing oppression of cryptocurrencies. This time the move came from South Korea, were the government intends to outlaw brokerage activities in the digital currency market. Recall, earlier this week Chinese government already made a statement that it is considering potential actions to ban the mining of cryptocurrencies. All these actions by local governments are mainly explained by anti-money laundering measures, while at the same time pointing to attempts by financial institutions to implement regulations in relation to cryptocurrency trades. This morning the BTC/USD pair was trading on the level of 13,257.00, continuing to lose ground along with the entire cryptocurrency market.
Major events of the day:
ECB Publishes Account of Monetary Policy Meeting – 14.30 (GMT +2)
US PPI – 15.30 (GMT +2)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.1871 R. 1.2061
USDJPY S. 110.28 R. 113.34
GBPUSD S. 1.3438 R. 1.3601
USDCHF S. 0.9700 R. 0.9885
AUDUSD S. 0.7777 R. 0.7900
NZDUSD S. 0.7097 R. 0.7280
USDCAD S. 1.2360 R. 1.2679
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