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 October 25
From the economic calendar: The day is important for the EUR as The European Central Bank will announce its official rate and conduct a press conference at half past three in the afternoon MT time. We do not anticipate the rate hike, however, the European Central Bank president Mario Draghi can make some hawkish comments for the EUR. As for the USD the level of core durable goods orders of the United States will be published. Analysts expect it to increase by 0.5%.
From the charts: EUR//USD anticipates today’s announcements. For now, the pair is testing the resistance at 1.1421. The hawkish comments by the European Central Bank President can make EUR/USD rise to the next resistance at 1.1521. However, if the USD is strong or more concerns on the Italian budget come out, it fall to the support at 1.1331. Yesterday Fitch placed Australia higher on the credibility rating. It made the aussie to rise towards the resistance at 0.7121. However, the currency was affected by the fall in the Asian stocks tonight. As a result, the tensions between buyers and sellers keep the price near the 0.7060 level. If the USD is strong, the pair will fall below the support at 0.7050. Otherwise, , the pair will rise above the resistance at 0.7083. The declines in the Treasury yields made the US dollar index to fall. If today’s data support the USD, the next resistance will be at 96.6. Otherwise, it will fall below the support at 96.02 to the next support at 95.25
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?
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