What is moving the markets today
Forex today: lots of tensions
- The US dollar index is above $94.50. Today traders will pay attention to consumer confidence data (17:00 MT time). The forecast is weaker than the previous data. However, if the actual one will be greater than the forecast, the US dollar will be able to rise further. The resistance is at $95.
- The euro is continuing to fall on Italian uncertainties. New election, forming of a “neutral” government, a possibility of impeachment of Italian president are still in the arena. Moreover, today’s economic data weren’t highly encouraging. Money supply data was at the same level of 3.9% as expected, private loans fell (2.9% vs 3.2%).
EUR/USD broke the support at 1.1580 and moving further. The next aim of bears is 1.1520.
Moreover, European shares are continuing to extend their losses based on the Italian news. Adding to the uncertainty, Spanish Prime Minister Mariano Rajoy will face a vote of confidence in his leadership on Friday.
- The pound is continuing to fall on the negative Brexit news. First of all, the European Union has moved to block British and other non-EU defence companies from participating in a new flagship €500m (£437m) defence fund after Brexit. Secondly, the UK was invited to participate in negotiations on the EU’s £1 trillion budget up to 2027. It seems strange as the next “multi-annual financial framework” (MFF) comes into force at the end of the transition period after Brexit. Most European governments believe that Britain will continue to pay billions of euros into the EU budget after Brexit as an “entrance fee” into the single market. As a result, GBP/USD is moving to the support at 1.32. No UK economic data will be released today. If the pair breaks the support, the further fall to 31.50 is anticipated.
- 10-year Treasury yields fell, Italy’s uncertainties increased the risk aversion, as a result, the US dollar widened its depreciation against the yen. USD/JPY broke the support at 108.90 and reached the next one at 108.50 (38.2 Fibo level). The next support lies at 108.20 (50-day and 100-day MAs). However, it’s a strong support as 2 MAs lie at the same level. Moreover, 50-day MA is crossing 100-day MA bottom-up. It is a signal of a pair’s rebound.
- Bitcoin is lower and lower. The cryptocurrency broke the psychological level at $7,000. The next support lies at $6,500. The fall of the digital currency is still caused by a strict regulation of several countries.
- There are no significant changes in other currencies’ movement. The Canadian dollar is extending its fall versus the US dollar based on the weak oil prices. The Australian dollar and New Zealand dollar are falling as well, however, no significant events for the currencies happened. Tomorrow a lot of economic data will be released. Traders should take them into consideration.
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