Following Friday’s outcomes, we can say only one thing – you saw everything on your own. The data on labor market were considerably better than predicted, herewith it was true for almost all its components, and it was followed by corresponding reaction of the market. Dollar’s index broke through above maximums of July-August and aims at continued growth.
This week there is a lot of economic information from the U.S.A. In addition, there is Veteran’s Day in the middle of the week, markets will work, but the activity will be lower. Only the data on retail sales can be regarded as a significant event. So, dynamics of the exchange market will be probably defined by news from other regions. In the Eurozone first evaluations of GDP for the 3rd quarter are on the first place. The forecast indicates stability, remaining during this year – steady growth continues, though at quite low pace. Under current conditions it can be regarded as a positive for the Eurozone. Besides, if final data on inflation aren’t worsened, then they will also indicate stability. Still, the report on industrial production from the Eurozone can be weak, starting from the similar data on Germany, published last week. In general, against weak information background of the U.S.A., euro has chances to regain losses slightly by the end of the week. British pound is in similar situation. On Wednesday the report on labor market will be published, it has been an engine for pound’s attempt to grow for recent months. This time forecasts are also quite good, it concerns mainly growth of wages. Their further growth will let pound correct too. Speaking of local events, it is worth paying attention to the report on Australian unemployment. There the forecast also promises employment growth, what is a positive for this currency pair. Thus, expectations of discrepancies in monetary policies by main world regulators are the main driving force for dollar’s growth now, still, there are opportunities for correction of this movement this week.
Today the data on payment and trade balances of Germany and European indicator of investors’ confidence Sentix are notable events. However, the market pays little attention to them, as a rule. So, after active Friday, the week can start with swinging, consolidating in narrow ranges.
From our point of view, after sharp decrease on Friday, EURUSD pair is likely to spend this day consolidating in the range 1.0700 – 1.0800. Now upper level of resistance is at 1.0800 – 1.0820. For today we recommend keeping short positions opened last week, rearranging stop at the break-even point (we preferred to act according to this option) or looking for possibilities to renew sales near resistance levels. The aim of middle-term movement is the range 1.0610 – 1.0640.
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