The market finished previous week inactively. Dollar strengthened its positions slightly, to which American statistics contributed, mainly due to Michigan University Index of consumer moods, which grew unexpectedly, still, this strengthening was limited. Although for two last days dollar has practically regained losses of the beginning of the week, market’s dynamics remain mixed, without clear tendency.
This week the focus will be mainly on the ECB session on monetary policy. After last weak data on inflation and series of weak reports on the Eurozone economy, players expect if not solutions on additional measures of quantitative easing, then strong statements about readiness to widen them. However, European Bank is quite conservative, it is often slow in making decisions. Besides, in spite of obvious signs of cooled economy detected even in Germany, its representatives have always been against monetary policy softening. Now there is no support of this policy either, despite economic slowdown. If Draghi, at his press conference, repeats the same he said a month ago and doesn’t give hints of adjustment to current rate, then a new wave of euro’s purchases can be expected. In general, this week news background wont’ be rich. In the Eurozone there are preliminary PMI, which, despite gradually passing positions, remain above 50 points. The U.S.A. has little statistics – only reports on housing market attract attention. Forecasts are positive, but it is difficult to orient at them – they rarely coincide. But then, this week rich news background will be in Canada – retail sales, inflation, and, what is more important, regular session of the Bank of Canada on monetary policy. Actually, BoC is unlikely to undertake some steps, what will allow Canadian dollar to continue growth, in spite of pair’s strong bounce from maximums. For American dollar situation remains complicated and uncertain. The economy gives contradictory signals, the Fed is indecisive. This week it has practically no arguments for independent growth. We have to wait gifts from currency rivals.
Today at Asian session the data on Chinese GDP for the 3rd quarter have been published, what cheered players slightly. Despite continued slowdown of growth rates in China, this slowing is at more moderate pace than predicted. This fact is positive for trade currencies, which managed to strengthen their positions slightly after publication of data. As for the rest, today’s news background is empty and this day can be inactive, without strong movements.
The closure of last week in EURUSD pair gives weak grounds for continued decrease in the short term, but doesn’t guarantee stable movement. To aggressive traders we recommend considering pair’s sale under breakthrough downward 1.1300, stop at 1.1390. In case of a pair decrease of more than 30 points from the entry point, rearrange stop at the entry point. The range 1.1240 – 1.1260 can become aim of this movement.
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