Market updates on November 7

Key events ahead:

EU economic forecasts – 12:00 MT (10:00 GMT)

Monetary policy summary by the Bank of England – 14:00 MT (12:00 GMT)

Speech by the BOE Governor Mark Carney – 14:30 MT (12:30 GMT)

The reports that China is ready to negotiate with the US on the possible cancellation of tariffs have increased the risk sentiment in the markets and pushed the risk-weighted currencies up.

• USD/JPY was going down yesterday on the news that the US-China partial trade deal may not be signed in December. The positive update brought an upside momentum to the pair and pushed it upwards to the 108.99 level on H4. If this level is broken, the next resistance will be placed at 109.22. If the risk sentiment switches to negative, the retest of the 108.65 level seems likely. In case of a breakout of the 100-period SMA, bears will target the next support at 108.51.

• GBP/USD is awaiting the monetary policy summary by the Bank of England. No rate changes are expected, that is why it is important to follow the comments by the BOE governor. On the 4-hour chart GBP/USD has been trading within the descending triangle pattern. The price is currently testing the upper border of a pattern at the 1.2874 level. If the BOE is hawkish, we expect a breakout of this level and a test of the 1.2897 level. After that, the next resistance will be placed at 1.2925. From the downside, the retest of the 1.2840 level will increase the chance of a fall towards 1.2808.

• The Australian dollar has also been boosted by the risk-on sentiment. The pair has risen by more than 30 pips after the start of the European trading session and tested the 0.6905 level. Further key levels for bulls will lie at 0.6914 and 0.6923. However, the situation may change quickly. Thus, the aussie may slide below the 0.6877 level and test the 0.6865 level. As far as 0.6865 is broken, the next support will be placed at 0.6850.

FBS Analyst Team

More by this author

Similar

27.12.2022 11:07 USD Holds the Line

The US dollar index keeps rounding above the 103.60 historical support level. The buyers have already defended this level for three weeks, highlighting their interest in the greenback. Thus, buying USD looks less risky right now. 

23.12.2022 11:17 US Dollar Prepares for the Pump

On the H4 timeframe, the US dollar index has formed a bullish falling wedge. At the beginning of the trading session, the price is testing the upper border of this wedge. Thus, in case of a higher-than-expected Core PCE Price Index m/m, the US dollar will skyrocket against other currencies. 

21.12.2022 11:38 Uptrend in Gold Starts Now

Happy Wednesday, traders! We went through the Internet and found the best news for you, take a look!

Latest news

30.01.2023 11:54 Market Crash Incoming?

This week may be the most important since the year started as the Fed assess the economic outlook and the US presents fresh NFP readings.

20.01.2023 15:54 What Currency Will Overperform?

S&P Global, a private banking company, will release a monthly change in British Flash Manufacturing Purchasing Managers Index (PMI) on January 24, 11:30 GMT+2. The index is a leading indicator of economic health as businesses react quickly to market conditions, and purchasing managers hold the most current and relevant insight into the company's view of the economy.

09.01.2023 18:39 Investor Positivity May Fade After Powell's Speech and CPI Release

The United States Bureau of Labor Statistics will publish the US Consumer Price Index (CPI) m/m on January 12 at 15:30 GMT+2. The index measures a change in the price of goods and services purchased by consumers.