The dollar extended gains against the other majors currencies on Tuesday, helped by the release of upbeat U.S. housing sector data and as sustained optimism over the outlook for the economy continued to support.
The U.S. National Association of Realtors said that existing home sales rose 2.0% in October to 5.60 million units from the 5.49 million units in the previous month. August’s data was revised from an initial reading of 5.47 million units, while the consensus forecast was for a 0.5% drop to 5.43 million units.
The greenback has remained supported amid expectations that President-elect Donald Trump’s plans to ramp up fiscal spending and cut taxes will spur economic growth and inflation. The U.S. dollar has also been boosted by bets that the U.S. central bank will almost certainly raise interest rates next month.
Today financial markets in Japan will remain closed for a holiday. In the UK, Chancellor Philip Hammond will present his autumn budget statement to parliament; the euro zone is to release survey data on private sector activity; the U.S. is to release data on durable goods orders, initial jobless claims, new home sales and a revised report on consumer sentiment; while, later in the day, the Fed is to publish the minutes of its November meeting.
On Tuesday GBP/USD declined 0.61% to 1.2416.
The U.K. Office for National Statistics earlier reported that public sector net borrowing increased by £4.30 billion in October, compared to expectations for a £5.90 billion rise. Public sector net borrowing climbed £9.24 billion in September, whose figure was revised from a previously estimated £10.12 billion increase.
Today in the UK, Chancellor Philip Hammond will present
Pivot: 1.2465Support: 1.237 1.23 1.2245Resistance: 1.2465 1.2515 1.2555Scenario 1: short positions below 1.2465 with targets at 1.2370 & 1.2300 in extension.Scenario 2: above 1.2465 look for further upside with 1.2515 & 1.2555 as targets.Comment: the RSI shows downside momentum.
Gold
Gold prices gave up gains on Tuesday, as the dollar regained ground against a basket of the other major currencies, pushing the precious metal back towards recent lows.
Market analysts have warned that the outlook for the precious metal remains cloudy in the near-term, given a U.S. interest rate hike in December is now a near-certainty. According to the Fed Rate Monitor Tool, odds for a rate hike at the Fed's December 13-14 meeting are at 100%.
Today metal traders will focus on: the U.S. data release on durable goods orders, initial jobless claims, new home sales and consumer sentiment; while, later in the day, all the attention will be on the Fed’s Minutes of its November meeting.
Pivot: 1205.5Support: 1205.5 1200 1190Resistance: 1219.25 1224 1230Scenario 1: long positions above 1205.50 with targets at 1219.25 & 1224.00 in extension.Scenario 2: below 1205.50 look for further downside with 1200.00 & 1190.00 as targets.Comment: technically the RSI is above its neutrality area at 50.
WTI Oil
Oil prices were little changed on Tuesday, after earlier rising to their highest levels this month, as a growing consensus emerged in the market that OPEC would overcome internal disputes and strike a deal to reduce crude output. But the market remained sensitive to comments from officials attending a technical meeting of the OPEC, which was trying to hammer out the details of an agreement before the formal meeting on the 30 of November.
The American Petroleum Institute said Tuesday that crude oil inventories fell 1.28 million barrels at the end of last week, following a build of 3.65 million barrels the previous week and breaking three straight weekly builds. Gasoline inventories jumped 2.7 million barrels last week and distillates fell by 350,000 barrels, marking six declines in the last seven weeks.
Today the U.S. Energy Information Administration is to release weekly data on oil and gasoline stockpiles. Baker Hughes will also release weekly data on the U.S. oil rig count, which is being released two days earlier than usual, because of the Thanksgiving Day holiday.
Pivot: 48.5Support: 47.15 46.38 45.8Resistance: 48.5 49.22 49.79Scenario 1: short positions below 48.50 with targets at 47.15 & 46.38 in extension.Scenario 2: above 48.50 look for further upside with 49.22 & 49.79 as targets.Comment: the upward potential is likely to be limited by the resistance at 48.50.
US 500
U.S. stocks extended their post-U.S. election rally on Tuesday with moderate gains that pushed the Dow above 19,000 for the first time and the three major indexes to record closing levels for a second straight day.
The S&P 500 ended above 2,200, led by gains in telecommunications up 2.1% and consumer discretionaries was up 1.2%. The small-cap Russell 2000 index also set another record high close.
Stocks have mostly rallied since the Nov. 8 election. Investors see President-elect Donald Trump's promises of tax cuts, higher spending on infrastructure and less regulation as beneficial to certain industries, including banking, industrials and healthcare.
Today investors will focus on: the U.S. data release on durable goods orders, initial jobless claims, new home sales and consumer sentiment; while, later in the day, all the attention will be on the Fed’s Minutes of its November meeting.
Pivot: 2179 Support: 2179 2169 2162 Resistance: 2216 2247 2270 Scenario 1: long positions above 2179.00 with targets at 2216.00 & 2247.00 in extension. Scenario 2: below 2179.00 look for further downside with 2169.00 & 2162.00 as targets. Comment: the RSI is mixed with a bullish bias.