FX News Today
- Stock market sentiment started to stabilise during the Asian session and many indices, first and foremost in China, managed to claw back some of Friday’s losses.
- Chinese indices led the way after moving past the disastrous trade number from last Friday.
- While dovish-leaning central banks in general and the additional action from the ECB in particular sparked fears that the global growth outlook is actually worse than anticipated, the fact that there is more support should also be constructive for stock markets in the medium term.
- BoJ is set to meet this week while it is believed that China and the US are in general agreement on many crucial issues and have held meaningful discussions on foreign exchange, according to People’s Bank of China Governor Yi Gang.
- Topix and Nikkei are up 0.57% and 0.47% respectively, the Hang Seng gained 0.68%, CSI 300 and Shanghai Comp are up 1.47% and 1.35% respectively and the Shenzhen Comp outperformed with a 3% gain. The ASX meanwhile was among the few underperformers with a loss of -0.38%.
- US futures are narrowly mixed, with the Dow Jones futures underperforming and the front end WTI future trading at USD 56.32 per barrel.
Charts of the Day
Technician’s Corner
- EURUSD has consolidated having risen after the NFP release, with 1.1256 standing as the next Resistance level, while Support is found at 1.1224.
- GBPUSD appears to be currently moving in anticipation of tomorrow’s Brexit developments, with immediate Resistance at 1.3050 and Support at 1.2961.
- XAUUSD moved past 1300 for a while before retracting, but remained above 1280 for a 6th day. Immediate support is at 1292 while Resistance remains at 1300.
- USDJPY is still trading at two week lows, with the immediate Support and Resistance levels standing at 111.05 and 111.25.
Main Macro Events Today
- Retail Sales ex Auto (USD, GMT 12:30) – Retail Sales are expected to have grown by 0.3% m/m, most likely a base effect from the previous 1.8% reduction in December.
- Eurogroup Meeting (EUR, Full Day) – The Finance Ministers of each Member State will meet in Brussels to discuss various financial issues, including fiscal policy.
Support and Resistance
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Dr Nektarios Michail
Market Analyst
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