
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.
The focus of traders’ attention shifted from concerns about the virus resurgence to hopes for a US stimulus package. As a result, the market sentiment improved, driving riskier currencies and stocks to the upside.
The most traded pair is heading to Monday’s high of 1.2155. If it manages to cross it, the way up to the high of December 4 at 1.2180 will be clear. According to UOB Group, the move above 1.2200 is likely as long as it trades above 1.2040. Support levels are at the 1.2100-1.2095 area and 1.2050.
Gold has pulled back from the resistance of $1 875. Now it is trading sideways at the 50% Fibonacci retracement level of $1 865. If it manages to close above the $1 875 level, the doors will be open towards the 61.8% Fibo level of $1 890. On the flip side, if it drops below the 100-period moving average of $1 840, it may fall to the next support of $1 825.
The aussie is rallying higher amid the overall risk-on market sentiment. It has approached the key resistance of 0.7450, which it has failed to cross a few times so far this month. The breakout will drive AUD/USD higher to the round number of 0.7500. There is strong support at the 50-period moving of 0.7400, which will be hard to cross for the pair. The next support will be at 0.7350.
The S&P 500 has reached an all-time high of 3 700. The way up is clear for further fresh highs. The next resistance may be at 3 750. The 50-period moving average has been nicely supporting the stock index so far. That’s why we can assume that it may stop the S&P from falling below 3 670. The next support levels are 3 645 and 3600. To trade the S&P 500 with FBS, you need the S&P 500-20Z.
Follow the rate decision of the Bank of Canada at 18:00 MT time.
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.
The US unemployment claims are out on Thursday at 15:30 MT time.
The American CPI is announced on Wednesday at 15:30 MT time.
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.
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