The main market tendency today is that the US dollar is rising against its major peers and riskier assets such as stocks and oil are plummeting.
Market updates on September 18
Key events ahead:
Canadian CPI – 15:30 MT (12:30 GMT) time
Crude oil inventories – 17:30 MT (14:30 GMT) time
FOMC rate statement and economic projections – 21:00 MT (18:00 GMT) time
FOMC press conference – 21:30 MT (18:30 GMT) time
- EUR/USD has fallen after the test of the 1.1074 level. The pair has touched the 100-period SMA at 1.1035. The direction of the pair will depend on the Fed meeting today at 21:00 MT. The market anticipates a rate cut. If it happens, the USD is forecast to fall. In this case, buyers will take advantage of the weaker USD and push the pair higher. The first resistance level lies at 1.1055. If it is broken, pay attention to the next resistance levels at 1.1067 and 1.1074. If the Fed surprises with keeping its rate on hold, the USD will strengthen. Bears will pay attention to the 1.1035 levels. If they manage to break it, the further levels in focus will be placed at 1.1014 and 1.1. Technically, the pair formed a symmetrical triangle.
- The traders of the CAD are awaiting the release of Canadian CPI at 15:30 MT. According to the forecasts, the indicator will slide by 0.2%. Higher-than-expected figures will pull USD/CAD below the 200-period SMA towards the support at 1.3253. The next key support will lie below the 100-period SMA at 1.3238. If the actual figures disappoint the market, the pair will rise above the 1.3271 level. The next resistance for the pair will be placed at 1.3289.
- Oil prices are consolidating ahead of the release of crude oil inventories. According to the forecast, the number of barrels held in inventory by commercial firms will decline by 2.1 million. Bigger fall will push the oil prices higher. The first resistance for WTI’s price will lie at $59.42. After that, pay attention to the $59.85, $60.5 and $60.86 levels. In case of an alternative scenario, the first support will lie at $58.76. After that, it is recommended to pay attention to the $58.4 and $57.72 levels.
- Key levels for Brent’s bulls are placed at $64.6, $65.2 and $65.76. In case of the fall, bears will target support levels at $63.46 and $62.9 (50-period SMA)
The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time.
Joe Biden is going to unveil a Covid-19 relief package of about $2 trillion. After this announcement, the 10-year Treasury yield rose, adding support for the USD.
The US dollar’s weakness offered a boost to emerging-market currencies and oil.