Market Brief
Nothing much has happened in Asian trading session. AUD/USD consolidates losses after selling-off to fresh 4-year low (0.8514) yesterday, amid RBA’s DepGov Lowe said the AUD should go lower with declining investments and deteriorating terms of trade, mostly due to weakness in commodity markets. Yet despite declining mining investment, the export revenue increased to 12% of the GDP from 5-7% in past years said Lowe, which added some optimism to his speech. Released overnight, the construction output contracted by 2.2% in 3Q, capped AUD-recovery in Sydney. The intense sell-off sent AUD/USD technicals in the red zone. The MACD stepped in the bearish territory, the next support stands at 0.85 – Stevens’ dreams have almost become true. Stops are eyed below.
In New Zealand, NZD/USD holds ground above 0.78, despite weakening positive momentum. The NZ trade terms are due later today. With expectations of higher exports and lower imports, the consensus is a narrow trade deficit in October. Any negative surprise should revive NZD-bears and push the MACD in the negative territories for a close below 0.7745. AUD/NZD breaks the 200-dma (1.0916) on the downside for the first time in four months, suggesting extension of weakness toward Fib 61.8% levels on Jul-Oct upshift (1.0884).
Released yesterday, the US GDP at 3.9% (annualized) beat market expectations in 3Q second read (3.3% exp. & 3.5% last), some one-off contribution from the government spending/defense helped. The personal consumption improved from 1.8% to 2.2% and the core PCE remained stable at 1.4%. Good economic data boosted USD in New York yesterday, while solid bond auction hit USD gains. High data stream in US today due to Thanksgiving holidays on Thursday.
EUR/USD advanced to 1.2487 amid solid US 5-year bonds auction halted the USD strength. The US 5-year yields fell back below 1.60%, US 10-years legged down to 2.25%. Low US yields have been beneficial to EUR/USD. The pair was well bid at 1.2466/1.2485 in Asia. Option bets abound at 1.2500, negatively biased. Traders look to sell the rallies as the Euro-zone’s core-periphery yield spreads keep falling on QE speculations and therefore weighing on EUR/USD.
In his speech before lawmakers yesterday, BoE Governor Carney did nothing exciting but repeated that rates will increase gradually. GBP/USD advanced to 1.5736 yesterday, now forming a triple top, and remained in the tight range of 1.5693/1.5722 in Asia. The MACD stepped in the green zone amid 1.5708 close yesterday. The technical bias is positive, resistance at 1.5736/37 should be cleared to endorse bullish reversal.
In Canada, the retail sales accelerated 0.8% on month to September (vs. 0.5% exp. & -0.3% last). USD/CAD traded down to 1.1233. No key technical levels have been damaged. Support remains at 1.1192 / 1.1230 (Nov 21st post-CPI reaction low / 50-dma). Attention shifts to November 27th OPEC meeting. Should the OPEC countries refrain to take action to sustain oil prices, the USD/CAD should break above the November descending channel to enter fresh bull market.
Today, traders focus on German October Import Price Index m/m & y/y, UBS October Consumption Indicators in Switzerland, Swedish November Consumer and Manufacturing Consumer, Swedish October Trade Balance, Norwegian September Unemployment Rate, Italian November Consumer Confidence Index, UK 3Q (Prelim) GDP q/q & y/y, Private Consumption, Government Spending, Exports & Imports q/q, Total Business Investment q/q & y/y, UK September Index of Services m/m & 3m/3m, US November 21st MBA Mortgage Applications, US October Durable Goods Orders, US November 22nd initial Jobless Claims & November 15th Continuing Claims, US October Personal Income & Spending, US October PCE Deflator and Core m/m & y/y, US November Chicago Purchasing Manager, University of Michigan’s November Final Confidence, US October New Home and Pending Home Sale m/m.
| Today's Calendar | Estimates | Previous | Country / GMT |
|---|---|---|---|
| GE Oct Import Price Index MoM | -0.50% | 0.30% | EUR / 07:00 |
| GE Oct Import Price Index YoY | -1.50% | -1.60% | EUR / 07:00 |
| SZ Oct UBS Consumption Indicator | - | 1.41 | CHF / 07:00 |
| FR Nov Consumer Confidence | 86 | 85 | EUR / 07:45 |
| SW Nov Consumer Confidence | 100 | 98 | SEK / 08:00 |
| SW Nov Manufacturing Confidence s.a. | 105.2 | 107.7 | SEK / 08:00 |
| SW Nov Economic Tendency Survey | 104 | 104.3 | SEK / 08:00 |
| SP Sep Total Mortgage Lending YoY | - | 49.50% | EUR / 08:00 |
| SP Sep House Mortgage Approvals YoY | - | 23.80% | EUR / 08:00 |
| SW Oct Trade Balance | 2.4B | 1.4B | SEK / 08:30 |
| NO Sep Unemployment Rate AKU | 3.70% | 3.70% | NOK / 09:00 |
| IT Nov Consumer Confidence Index | 101.6 | 101.4 | EUR / 09:00 |
| UK 3Q P GDP QoQ | 0.70% | 0.70% | GBP / 09:30 |
| UK 3Q P GDP YoY | 3.00% | 3.00% | GBP / 09:30 |
| UK 3Q P Private Consumption QoQ | 0.60% | 0.60% | GBP / 09:30 |
| UK 3Q P Government Spending QoQ | 0.20% | 1.00% | GBP / 09:30 |
| UK 3Q P Gross Fixed Capital Formation QoQ | 2.30% | 1.30% | GBP / 09:30 |
| UK 3Q P Exports QoQ | -0.10% | -0.40% | GBP / 09:30 |
| UK 3Q P Imports QoQ | 0.70% | -0.30% | GBP / 09:30 |
| UK Sep Index of Services MoM | 0.40% | 0.00% | GBP / 09:30 |
| UK Sep Index of Services 3M/3M | 0.70% | 0.80% | GBP / 09:30 |
| UK 3Q P Total Business Investment QoQ | 2.30% | 3.30% | GBP / 09:30 |
| UK 3Q P Total Business Investment YoY | 9.70% | 11.00% | GBP / 09:30 |
| UK Nov CBI Reported Sales | 28 | 31 | GBP / 11:00 |
| US Nov 21st MBA Mortgage Applications | - | 4.90% | USD / 12:00 |
| US Oct Durable Goods Orders | -0.60% | -1.30% | USD / 13:30 |
| US Oct Durables Ex Transportation | 0.50% | -0.20% | USD / 13:30 |
| US Oct Cap Goods Orders Nondef Ex Air | 1.00% | -1.70% | USD / 13:30 |
| US Oct Cap Goods Ship Nondef Ex Air | 0.50% | -0.20% | USD / 13:30 |
| US Nov 22nd Initial Jobless Claims | 288K | 291K | USD / 13:30 |
| US Nov 15th Continuing Claims | 2348K | 2330K | USD / 13:30 |
| US Oct Personal Income | 0.40% | 0.20% | USD / 13:30 |
| US Oct Personal Spending | 0.30% | -0.20% | USD / 13:30 |
| US Oct PCE Deflator MoM | 0.00% | 0.10% | USD / 13:30 |
| US Oct PCE Deflator YoY | 1.40% | 1.40% | USD / 13:30 |
| US Oct PCE Core MoM | 0.20% | 0.10% | USD / 13:30 |
| US Oct PCE Core YoY | 1.50% | 1.50% | USD / 13:30 |
| US Nov Chicago Purchasing Manager | 63 | 66.2 | USD / 14:45 |
| US Nov F Univ. of Michigan Confidence | 90 | 89.4 | USD / 14:55 |
| US Oct Pending Home Sales MoM | 0.50% | 0.30% | USD / 15:00 |
| US Oct Pending Home Sales NSA YoY | 2.50% | 1.00% | USD / 15:00 |
| US Oct New Home Sales | 471K | 467K | USD / 15:00 |
| US Oct New Home Sales MoM | 0.80% | 0.20% | USD / 15:00 |
| NZ Oct Trade Balance | -642M | -1350M | NZD / 21:45 |
| NZ Oct Exports | 3.85B | 3.61B | NZD / 21:45 |
| NZ Oct Imports | 4.60B | 4.97B | NZD / 21:45 |
| NZ Oct Trade Balance 12 Mth YTD | 183M | 648M | NZD / 21:45 |
Currency Tech
EURUSD
R 2: 1.2578
R 1: 1.2505
CURRENT: 1.2473
S 1: 1.2402
S 2: 1.2358
GBPUSD
R 2: 1.5835
R 1: 1.5737
CURRENT: 1.5711
S 1: 1.5593
S 2: 1.5575
USDJPY
R 2: 120.00
R 1: 118.98
CURRENT: 117.73
S 1: 117.36
S 2: 115.46
USDCHF
R 2: 0.9839
R 1: 0.9751
CURRENT: 0.9643
S 1: 0.9606
S 2: 0.9531