The Fed is ready to start tapering in November. Since the markets were expecting this and it wasn’t a surprise, the USD slumped allowing risk-on currencies and gold to rally up.
News to trade on November 14
- The British pound will be in focus today. At first, today's CPI release increased by a lower-than-expected level of +0.1%.
After that, Theresa May is scheduled to meet with her cabinet to discuss the draft Brexit agreement at 16:00 MT time. If the Cabinet agrees, the next step will be to get the approval at the House of Commons. For now, the DUP from Northern Ireland and the Labour leadership expressed their negative opinions. However, Theresa May thinks the fear of a no-deal Brexit can drive Conservatives and Labor party to support the agreement.
According to newspapers, the UK Cabinet Ministers Raab, Hunt, Javid, Gove, and Cox said they would agree on the draft Brexit paper.
Up to now, Brexit headlines are driving the pair.
Higher-than-expected CPI data can give a positive momentum to GBP/USD and help it to cross 50-day MA and 100-day MA and test the resistance at 1.3036. If the Brexit agreement will be approved, the cable will stick above 1.3036. However, if more uncertainties take over the market, the pair will fall below the 1.2896 support.
- CPI of the US is also gaining attention today at 15:30 MT. Analysts expect it to rise by 0.3% in October. As for the core CPI, it is forecast to increase by 0.2%. Comments by Chinese president Xi ahead of his meeting with President Trump at G20 and positive mood across the equity markets weakened the US Dollar, however, the inflation data can support the currency.
On the daily chart of the US Dollar index, the index is trading lower than yesterday. If CPI is higher than expected, the index can rise above the resistance at 97.21. Weak CPI data and risk-on sentiment among traders can pull it down towards the 96.35 support.
- Yesterday the Italian government kept the budget targets for deficit and GDP for 2019 unchanged. In response, the European Commission may initiate the immoderate deficit procedure. If the USD gains after the CPI release, EUR/USD will fall below the support at 1.1265. If the bearish pressure for the pair weakens, the pair will stick above the resistance at 1.13.
- In its latest monthly oil market report, the International Energy Agency (IEA) cut the demand forecasts for the OPEC crude oil for 2019. Up to now, WTI is trading at November 2017 levels, testing the resistance at $56.26. If the easing of the sanctions continues, WTI can fall towards the next support at $53.25
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US Retail Sales will be out on October 15 at 15:30 MetaTrader time (GMT+3).
The crypto market keeps recovering. Bitcoin has broken above $57,000. The way up to $60,000 is open now!
The US dollar is heading to close the seventh day in the red as it remains under selling pressure. The US data at 15:30 GMT+3 (jobless claims and Philly Fed Manufacturing Index) may support the greenback if it's strong.
Canada will publish the Retail Sales and Core Retail Sales on October 22, at 15:30 MT time (GMT+3).
The United States will release the weekly Unemployment Claims on October 21, at 15:30 MT time (GMT+3).