For a long time, traders considered American Non-farm Payrolls (NFP) the most important release in the market. However, the situation has changed. Now US CPI moves financial markets.
Trading plan for December 11
Today we anticipate the release of US PPI and core PPI at 15:30 MT time. According to analysts, the headline PPI will remain at the same level. As for the core PPI, it is expected to increase by 0.1%. If the actual data is higher than the forecasts, it will support the USD.
Also, the speech by the Reserve bank of New Zealand Governor is scheduled at 21:15 MT time. If the governor surprises the market with a hawkish tone, it will support the NZD.
As for the British pound, Theresa May delayed her critical vote, which was scheduled for today. That is why the Brexit headlines will continue to affect the market
Yesterday, strong US Dollar pulled EUR/USD below the central pivot at 1.1374. The form of the candlestick shows an uncertainty among traders, as the pair even tested the level at 1.1437.
On H4, we can see that the pair has already tested the resistance at 1.1374. If the USD is supported by the PPI release, the pair will fall towards the support at 1.1323. Otherwise, it will stick above 1.1374.
Let's look at NZD/USD chart. The risk-off sentiment resulted in forming a Doji candlestick yesterday. If the speech by the RBNZ governor is hawkish, the NZD will stick above the resistance at 0.6890. In case of the dovish comments or strong USD, it will fall towards the support at 0.6811.
GBP/USD fell below the 1.13 level and tested the support at 1.2560. According to news, Theresa May negotiations today can bring the volatility to the GBP traders. Currently, she is meeting with Dutch PM, after that there will have a meeting with Angela Merkel in Germany and, finally, will head over to Brussels to meet with the European Commission president. If there are more uncertainties on Brexit or the USD is strong, it will break the support at 1.2560 and target the next support at 1.2462. In case of positive news, the pair will recover. The first resistance lies at 1.2642.
The higher prices seen today are generally related to the pandemic, that’s no doubt. US consumer prices jumped in October at the fastest pace in three decades putting the Biden administration on the defensive and increasing prospects that the Federal Reserve will raise interest rates next year. Jerome Powell says Fed will discuss speeding up bond-buying taper at the December meeting. What does it mean for markets?
It seems like most of the assets have joined Black Friday's sell-off with global indices, risky currencies, and commodities going down.