Last week was full of surprises! The US dollar plunged despite a better-than-expected retail sales report…
Stocks up, USD down
- S&P 500 skyrocketed to the all-time high on optimism that Biden’s fiscal stimulus will support economic growth and boost corporate earnings. Interesting fact: it was the best S&P 500 reaction to a presidential inauguration since at least 1937.
- Crude oil dropped on worries over weakened consumption amid the continuing Covid-19 pandemic. Elsewhere, Biden announced its intentions to develop green energy and lower the oil dependency.
- The JPY surged after the Bank of Japan kept its main policy settings unchanged.
- The Australian dollar rose as the country’s unemployment rate plunged. In addition, the overall risk-in sentiment helped the aussie to gain.
- A little about sad things, Germany reported record daily deaths. A study by South African scientists raised concerns over the vaccine efficacy against the new virus variant.
- All eyes today on the ECB report at 14:45 MT time. It will be the main euro driver today as the ECB may try to talk down the EUR as the EU economy is suffering from the recession.
EUR/USD bounced off the 50-period moving average. If it drops below yesterday’s low of 1.2100, the way down to the low of January 18 at 1.2050 will be clear. On the flip side, the breakout above will drive the pair to the next resistance of 1.2170.
The British pound tries to break through the key resistance of 1.3700. Once it manages to do it, the way up to 1.3750 will be clear. Support levels are at the 100-period moving average of 1.3600 and the low of January 18 at 1.3530.
XAU/USD surged! If it jumps above the 100-period moving average of $1 885, the way up to the key psychological mark of $1 900 will be clear. Support levels are $1 825 and $1 800.
USD/CAD dipped to the level of 1.2610, unseen since April 2018. Today the pair tries to rebound its losses. The move above yesterday’s intraday high of 1.2650 will press the pair up to the next resistance of 1.2665. Support levels are 1.2610 and 1.2550.
- The ECB report will be at 14:45 MT time.
- US unemployment claims will be out at 15:30 MT time.
Last week was very interesting for the markets, as we saw the releases of the US Inflation and Disney’s earnings report. So let's see what we should await this week!
The volatility that the markets experienced last week promises the second tidal wave! What should your favorite assets anticipate during the first week of February?
The US Bureau of Economic Analysis will publish Core Personal Consumption Expenditures (PCE) on May 27 at 15:30 GMT+3.
The United States will publish the Preliminary GDP on Thursday, May 26, at 15:30 GMT+3.
The Reserve Bank of New Zealand will publish a monetary policy report and make an update on the interest rate on May 25, at 05:00 GMT+3.