Day’s events (GMT 3):
- 12:30 UK: Retail Sales (MoM) (Nov).
- 15:00 UK: BoE Interest Rate Decision.
- 16:30 USA: Philadelphia Fed Manufacturing Survey (Dec), Initial Jobless Claims 4-week average (Dec 13).
- 18:00 USA: Existing Home Sales (MoM) (Nov), Existing Home Sales Change (MoM) (Nov).
The price had fallen by the end of the day, but did not reach the calculated target of 1.1090/95. Growth stopped near the low which was set on December 13, when the euro price rose to 1.1199.
In the Asian markets, bulls’ activity resulted in the price moving back towards the trendline, which acted as yesterday’s support. Bears were slow off the mark, and news out of Australia temporarily changed the mood of market players. The catalyst for the strengthening of AUD and other currencies was the publication of favourable data concerning employment figures - the country's unemployment rate fell from 5.3% to 5.2% in November.
The target is 1.1093/95 (1.1093 – 90th degree from 1.1199, 1.1195 – 67th degree from 1.1175). If you look at the downward channel, the target is lower at 1.1082. We believe that there is still further downward movement ahead. After the breakout at 1.1120, we expect increased pressure on the single currency. The target of 1.1195 is more than valid, so there is no real need to make any forecast.
A surge in volatility is expected at 12:30 (Moscow time), after the Bank of England’s announcement regarding its decision on setting the latest interest rate. Sharp fluctuations in the pound will affect the EURGBP cross currency if it is voted upon to reduce or maintain the current rate. If, at the same time, dollar trading is “calm”, then we can expect to see the EURUSD pair also affected.
Now a few words about yesterday's debate on the impeachment of Trump. On Thursday, the US House of Representatives voted to impeach President Donald Trump on two counts: “abuse of power” and “obstruction of Congress.” The debate before the vote in the House of Representatives lasted more than six hours. However, this does not mean that Trump has to leave his post, for that to happen, the Senate must vote on the matter, after he has faced trial before them.
The Republicans currently hold a majority in the US Senate, therefore, it is highly unlikely that a guilty verdict will be returned and the President impeached. Trump is ready for the next stage of the proceedings and is very confident that he will retain office. As you saw, the markets were very calm in reaction to the decision of the US House of Representatives.