Tuesday 17th November: European Open Briefing

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Tuesday 17th November: European Open Briefing 1

Global Markets:

  • Asian stock markets: Nikkei up 1.60 %, Shanghai Composite gained 1.40 %, Hang Seng rose 0.30 %, ASX 200 rallied 1.65 %
  • Commodities: Gold at $1081 (-0.20 %), Silver at $14.23 (+0.05 %), WTI Oil at $41.70 (-0.05 %), Brent Oil at $44.60 (-0.40 %)
  • Rates: US 10 year yield at 2.27, UK 10 year yield at 1.95, German 10 year yield at 0.55

News & Data:

  • Japan Housing Loans (YoY) Q3: 2.4% (prev 2.4%)
  • Australia ANZ Roy Morgan Weekly Consumer Confidence Index (W/E 15 Nov): 115.9 (prev 116.6)
  • RBA: Prospects For Economic Improvement Have Firmed A Little  
  • RBA: Inflation Outlook May Afford Scope For Further Easing
  • RBA: Sees Inflation Consistent With Target Over Next 1 To 2 years
  • RBA: Spare Capacity In Economy To Persist For Some Time
  • RBA: A$ Adjusting, Boosting Demand For Domestic Production
  • RBA: Asia Slowdown Likely To Be More Persistent Than Expected
  • RBA: Mining Investment Fall To Have Run Its Course By End 2017
  • RBA: Mortgage Rate Hikes Make Policy Slightly Less Accommodative
  • PBoC Fixes Yuan Reference Rate At 6.3740 (prev 6.3750)

CFTC Positioning Data:

  • EUR shorts 143K vs short 134K previous
  • GBP shorts -16K vs flat last week
  • JPY short 67K vs short 44k last week
  • CAD short 18K vs. short 19K last week
  • CHF short 9K vs short 7K last week
  • AUD short 53K vs short 39K last week
  • NZD long 6K vs long 7K last week

Markets Update:

After initially recovering during yesterday's EU session, the Euro came again under pressure during the NY session and extended losses overnight. EUR/USD fell to a low of 1.0655 and there is now little support until 1.0500/10. EUR/GBP also fell below a significant support level at 0.7035 and it slowly heading towards a test of the 0.70 level. Next major support is seen at 0.6950. Meanwhile, GBP/USD continues to consolidate, but it's getting close to the 1.5170 support level and a clear break below would pave the way for a move back to 1.51 and eventually 1.5025.

USD/JPY bounced off 122.20 yesterday and didn't look back. It rallied to 123.10 and extended gains overnight, reaching 123.40. Decent resistance is expected at 123.60 and then 124.50. AUD/USD has been quiet since the new trading week started. The 0.7080 support level is holding for now, but it is looking fragile and a retest of the 0.7015 level seems likely. NZD/USD is already under pressure and with the 0.65 support level cleared, the focus is now on 0.6385.

Upcoming Events:

  • 09:00 GMT – Italian Trade Balance
  • 09:00 GMT – Norwegian GDP
  • 09:30 GMT – UK CPI
  • 10:00 GMT – German ZEW Economic Sentiment
  • 10:00 GMT – Euro Zone ZEW Economic Sentiment
  • 13:30 GMT – US CPI
  • 14:15 GMT – US Industrial Production
  • 14:15 GMT – US Manufacturing Production
  • 15:00 GMT – US NAHB Housing Market Index

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