Yesterday's data on the ongoing earnings season of S&P companies showed that the stock markets were on the right side when rising since Spring 2009. That together with other positive economic data flowing in showing a recovery supported the Greenback as well as expectations of rising interest rates later in this year. Only minor corrections of the dollar's overbought situation in the majors illustrated this fact.
We do not expect the USD to gain a lot more strength today. The dollar is still overbought and bumping into long-term resistance lines against the majors. However, the bid tone of the current market cannot be overseen. Note today the BoE's publication of its monetary policy at 13:00 CET and the ECB's policy at 13:45. Markets expect an unchanged expansive policy by the two central banks, though the ECB's press conference at 14:30 CET could be spiced with a few words hinting to an early end of the institutions' quantitative easing. That always has led to some rocking of the volatility boat. The U.S. data calendar today includes Initial Jobless Claims as well as Nonfarm Productivity for 4Q at 14:30, also Factory Orders for December at 16:00 CET - all numbers expected to show further improvement.
by George Clement
Intraday Market Outlook for Day Traders
EUR / USD
The pair began the European morning in a weak condition and another selling wave brought the market down to the current 1.3848. We see some consolidation in development now, but later in the day a testing of the 1.3750 long-term support line, from where up corrections could follow.
GBP / USD
Cable was on the selling side in early European trading and has hit a low at 1.5824, currently trading at 1.5852 with the chance of slight upmoves right now but not above 1.5850, where we see selling coming into the market again. The longer-term support zone between 1.5750 and 1.5700 could be tested.
USD / CHF
Further bidding in the European morning market jerked the dollar to a high at 1.0634 against the Swiss franc, currently at 1.0606. We expect some digestion phase first with support at 1.0600, and then another step upwards to the long-term resistance at 1.0650.
JPY / USD
Having reached highs just above 91.00 against the yen in Asian trading, the dollar is in a correction mood in the European morning hours, testing the resistance point around 90.50 and currently trading at 90.59. We expect that resistance to hold in today's market and another upmove, breaking above today's highs and towards 91.50.
We do not expect the USD to gain a lot more strength today. The dollar is still overbought and bumping into long-term resistance lines against the majors. However, the bid tone of the current market cannot be overseen. Note today the BoE's publication of its monetary policy at 13:00 CET and the ECB's policy at 13:45. Markets expect an unchanged expansive policy by the two central banks, though the ECB's press conference at 14:30 CET could be spiced with a few words hinting to an early end of the institutions' quantitative easing. That always has led to some rocking of the volatility boat. The U.S. data calendar today includes Initial Jobless Claims as well as Nonfarm Productivity for 4Q at 14:30, also Factory Orders for December at 16:00 CET - all numbers expected to show further improvement.
by George Clement
Intraday Market Outlook for Day Traders
EUR / USD
The pair began the European morning in a weak condition and another selling wave brought the market down to the current 1.3848. We see some consolidation in development now, but later in the day a testing of the 1.3750 long-term support line, from where up corrections could follow.
GBP / USD
Cable was on the selling side in early European trading and has hit a low at 1.5824, currently trading at 1.5852 with the chance of slight upmoves right now but not above 1.5850, where we see selling coming into the market again. The longer-term support zone between 1.5750 and 1.5700 could be tested.
USD / CHF
Further bidding in the European morning market jerked the dollar to a high at 1.0634 against the Swiss franc, currently at 1.0606. We expect some digestion phase first with support at 1.0600, and then another step upwards to the long-term resistance at 1.0650.
JPY / USD
Having reached highs just above 91.00 against the yen in Asian trading, the dollar is in a correction mood in the European morning hours, testing the resistance point around 90.50 and currently trading at 90.59. We expect that resistance to hold in today's market and another upmove, breaking above today's highs and towards 91.50.
