Market Brief
USD/JPY made a fresh upside attempt of 116.38 on specs that Japan is moving toward a delay in sales tax hike. The weakening bull momentum should limit the appetite for lower JPY until next Monday’s GDP release, yet markets are clearly pricing in a weak print. Depending on what mood the Japan will wake up next Monday, 118/120 could quickly become the next target zone (base case scenario) or a sizeable correction will hit the market. Light option bids will likely give support at 115.75/116.00 before the week-end. EUR/JPY advanced to 144.84. The key resistance is placed at 145.69 (Dec 27th high). The JPY weakness push AUD, NZD upward. AUD/USD tests 0.8732/44 (21-dma / Fib 23.6% on Sep-Nov sell-off), NZD/USD checks 0.7928/38 offers (50-dma / Fib 23.6% on Jul-Nov drop). The focus will shift to US retail sales data before the weekend.
EUR/USD advanced to 1.2492 in New York yesterday, New York Fed Dudley’s call for some patience before the US policy normalization offset the soft CPI releases across the leading Euro-zone economies, the softness being already priced in. Today, EUR-traders watch the EZ aggregate CPI and the 3Q preliminary GDP data. Markets anticipate improvement in 3Q growth figures across the EZ. The early figures are encouraging: French and German GDP accelerated, from 0.0% to 0.3% q/q in France, from -0.2% to 0.1% q/q in 3Q. EUR/USD may well step in short-term bullish consolidation zone. The MACD will step in the green zone for a weekly close above 1.2475. Option barriers at 1.2500/50 should show some resistance before the closing bell. The strengthening bullish momentum sent EUR/GBP above its daily Ichimoku cloud cover (0.78747/0.79163). We see room for further upside correction. Decent option bids are seen at 0.7900/0.7950 this Friday. The key resistance is placed at 0.80400/600 (Sep/Oct highs). EUR/CHF stabilizes in the tight range of 1.2017/25, dangerously nearing SNB’s 1.20 floor. The interest rate futures continue trading above par (price in negative rates) as pressures on the floor remain tight.
GBP/USD extended weakness to fresh year low of 1.5654 following the strengthening selling pressures amid Wednesday’s QIR. Decent option barriers at 1.5750/1.5800 will likely keep the gravity on the downside.
In Brazil, the Real continues its slide as the freshly re-elected President Rousseff prepares to appoint the new finance minister. USD/BRL hit 1.6085 yesterday. We keep our long gamma view and expect higher volatilities as uncertainties persist.
The focus today: French, German, Italian and Euro-zone 3Q (Prelim) GDP q/q & y/y, French 3Q (Prelim) Mon-farm Payrolls and Wages q/q, Swedish 3Q Industrial Capacity, Italian September General Government Debt, UK September Construction Output m/m & y/y, Euro-Zone October Final CPI m/m & y/y, US October Retail Sales m/m, US October Import Price Index m/m & y/y, Canadian September Manufacturing Sales m/m, University of Michigan November (Prelim) Confidence Index, US September Business Inventories, US 3Q MBA Mortgage Foreclosures and Mortgage Delinquencies.
Swissquote Sqore Trade Ideas:
| Today's Calendar | Estimates | Previous | Country / GMT |
|---|---|---|---|
| FR 3Q P GDP QoQ | 0.10% | 0.00% | EUR / 6:30 AM |
| FR 3Q P GDP YoY | 0.40% | 0.10% | EUR / 6:30 AM |
| GE 3Q P GDP SA QoQ | 0.10% | -0.20% | EUR / 7:00 AM |
| GE 3Q P GDP WDA YoY | 1.10% | 1.20% | EUR / 7:00 AM |
| GE 3Q P GDP NSA YoY | 1.00% | 0.80% | EUR / 7:00 AM |
| SW Maeklarstatistik Housing Price Data | - | - | SEK / 7:00 AM |
| FR 3Q P Non-Farm Payrolls QoQ | - | 0.10% | EUR / 7:45 AM |
| FR 3Q P Wages QoQ | - | 0.40% | EUR / 7:45 AM |
| SW 3Q Industry Capacity | - | 88.90% | SEK / 8:30 AM |
| IT 3Q P GDP WDA QoQ | -0.10% | -0.20% | EUR / 9:00 AM |
| IT 3Q P GDP WDA YoY | -0.40% | -0.20% | EUR / 9:00 AM |
| IT Sep General Government Debt | - | 2148.4B | EUR / 9:30 AM |
| UK Sep Construction Output SA MoM | 4.00% | -3.90% | GBP / 9:30 AM |
| UK Sep Construction Output SA YoY | 4.30% | -0.30% | GBP / 9:30 AM |
| EC Oct CPI MoM | 0.00% | 0.40% | EUR / 10:00 AM |
| EC Oct F CPI YoY | 0.40% | 0.40% | EUR / 10:00 AM |
| EC Oct F CPI Core YoY | 0.70% | 0.70% | EUR / 10:00 AM |
| EC 3Q A GDP SA QoQ | 0.10% | 0.00% | EUR / 10:00 AM |
| EC 3Q A GDP SA YoY | 0.70% | 0.70% | EUR / 10:00 AM |
| US Oct Retail Sales Advance MoM | 0.20% | -0.30% | USD / 1:30 PM |
| US Oct Retail Sales Ex Auto MoM | 0.20% | -0.20% | USD / 1:30 PM |
| US Oct Retail Sales Ex Auto and Gas | 0.40% | -0.10% | USD / 1:30 PM |
| US Oct Retail Sales Control Group | 0.40% | -0.20% | USD / 1:30 PM |
| US Oct Import Price Index MoM | -1.50% | -0.50% | USD / 1:30 PM |
| US Oct Import Price Index YoY | -1.60% | -0.90% | USD / 1:30 PM |
| CA Sep Manufacturing Sales MoM | 1.00% | -3.30% | CAD / 1:30 PM |
| US Nov P Univ. of Michigan Confidence | 87.5 | 86.9 | USD / 2:55 PM |
| US Sep Business Inventories | 0.20% | 0.20% | USD / 3:00 PM |
| US 3Q Mortgage Delinquencies | - | 6.04% | USD / 3:00 PM |
| US 3Q MBA Mortgage Foreclosures | - | 2.49% | USD / 3:00 PM |
Currency Tech
EUR/USD
R 2: 1.2577
R 1: 1.2510
CURRENT: 1.2444
S 1: 1.2395
S 2: 1.2358
GBP/USD
R 2: 1.5835
R 1: 1.5781
CURRENT: 1.5672
S 1: 1.5607
S 2: 1.5575
USD/JPY
R 2: 117.00
R 1: 116.50
CURRENT: 116.24
S 1: 115.00
S 2: 113.86
USD/CHF
R 2: 0.9751
R 1: 0.9701
CURRENT: 0.9649
S 1: 0.9617
S 2: 0.9580