GBP trading on Tuesday is too volatile. The pound/dollar in Asia fell to 1.4378 from a 1.4444 maximum as part of a correctional recoil on the euro/pound. After business activity indices’ reports came out for construction in the UK, the pound weakened against the dollar to 1.4325. The correction against Monday totalled 100 points or around 38.2% (Fibonacci coefficient).
The pound jumped to 1.4410 (+85 points) from 1.4325. Demand for the pound was caused by Eurozone PMI deflation.
The UK construction sector slowed: the PMI fell in January to 55.0 against December’s 57.8 (forecasted: 57.5).
The Eurozone’s PMI for December fell by 0.8% MoM and by 3.0% YoY (forecasted: -0.5% MoM, -2.9% YoY, previous: -0.2% MoM, -3.2% YoY).
The euro/dollar is trading above 1.0900. Demand for the euro persists after a fall in oil and flight from risky assets. Decent labour market data from Germany assisted, with the number of unemployed and unemployment as a whole down.
The Shanghai Composite closed up to 2,749.57 (+2.26%). The Nikkei 225 fell by 0.64% and the French CAC 40 lost 2.0%, dropping to 4,305.12 points. The German DAX fell by 1.38% to 9,623.23 points. The UK FTSE100 fell 1.74% to 5,954.81.
The economic calendar for this evening is empty. Movements on dollar pairs will depend on that of the stock markets. The technical picture on the hourly timeframes is set against the USD. The euro bulls are gearing up to pass the 1.0950 resistance. The road to 1.4465 is open for the pound/dollar.
Forecasts which are made in the review constitute the personal view of the author. Commentaries made do not constitute trade recommendations or guidance for working on financial markets. Alpari bears no responsibility whatsoever for any possible losses (or other forms of damage), whether direct or indirect, which may occur in case of using material published in the review
Recommended Content
Editors’ Picks
EUR/USD trades with negative bias, holds above 1.0700 as traders await US PCE Price Index
EUR/USD edges lower during the Asian session on Friday and moves away from a two-week high, around the 1.0740 area touched the previous day. Spot prices trade around the 1.0725-1.0720 region and remain at the mercy of the US Dollar price dynamics ahead of the crucial US data.
USD/JPY jumps above 156.00 on BoJ's steady policy
USD/JPY has come under intense buying pressure, surging past 156.00 after the Bank of Japan kept the key rate unchanged but tweaked its policy statement. The BoJ maintained its fiscal year 2024 and 2025 core inflation forecasts, disappointing the Japanese Yen buyers.
Gold price flatlines as traders look to US PCE Price Index for some meaningful impetus
Gold price lacks any firm intraday direction and is influenced by a combination of diverging forces. The weaker US GDP print and a rise in US inflation benefit the metal amid subdued USD demand. Hawkish Fed expectations cap the upside as traders await the release of the US PCE Price Index.
Sei Price Prediction: SEI is in the zone of interest after a 10% leap
Sei price has been in recovery mode for almost ten days now, following a fall of almost 65% beginning in mid-March. While the SEI bulls continue to show strength, the uptrend could prove premature as massive bearish sentiment hovers above the altcoin’s price.
US economy: Slower growth with stronger inflation
The US Dollar strengthened, and stocks fell after statistical data from the US. The focus was on the preliminary estimate of GDP for the first quarter. Annualised quarterly growth came in at just 1.6%, down from the 2.5% and 3.4% previously forecast.