News sources indicate that the United States and China are planning on a delay of tariff hikes due to kick in on December 15th.
The Washington administration is expected to add 15% tariffs on over $165 billion worth of goods imported from China.
However, with both parties locked in the negotiations, there is scope for a delay of the tariff hikes. Investors remain cautious about the news and are preparing for the Fed meeting due later today.
Euro Trades Subdued Ahead of Fed Meeting
The euro has traded rather flat ahead of the FOMC meeting scheduled for today. There were no major new releases from the eurozone on Tuesday. Data from the US was also sparse on the day.
EURUSD Breaks Past Resistance Level
The euro broke past the resistance area of 1.1072. Price action is seen now trading close to the previously established resistance level of the 1.1100 region.
If this previously held resistance level holds, then price could turn flat within the said levels. A breakout from either 1.1100 or 1.1072 is needed to confirm the further direction in price action.
Sterling Retreats Off an 8-Month High
The pound sterling has retreated off an eight-month high. The declines came as the GBPUSD fell over 0.2% on the day. Reports of a possible hung parliament in the UK were seen hitting the sentiment.
With less than a day to go until the UK elections, the GBPUSD is expected to show some volatility.
Will the GBPUSD Decline Further?
The currency pair touched an eight-month high before easing back during the intraday session. Price is short of testing the immediate support level of 1.3100.
As long as this support holds, GBPUSD is on track for further gains if the current highs are breached. To the downside, a breakdown below 1.3100 will trigger further declines likely toward the 1.2960 region.
Gold Consolidates Ahead of Fed Meeting
The precious metal held its ground as a brief risk-off sentiment saw equity prices falling. However, the metal was relatively subdued on the day.
The Fed is expected to keep interest rates on hold at its meeting today. Investors will be looking at the meeting for further clues on monetary policy.
XAUUSD Consolidates at Support
XAUUSD is consolidating near the support/resistance area of 1462. The Stochastics oscillator is currently rising from the oversold level indicating a possible move to the upside.
If this occurs, XAUUSD could test the 1483 region once again. To the downside, the lower support at 1445 remains the target.