Today’s economic calendar is light. On Friday evening, the United Stated reported slightly better than expected retail sales, showing 0.3% growth ahead of the forecast of 0.2%. On the other hand, Industrial Productions showed a worse than expected reading of -0.8%, twice worse than the forecast of -0.4%. Core Retail Sales also missed expectations, having come in at 0.2% below the forecast of 0.4%.
The market is waiting for new updates on phase one of the agreement between United States and China. Both sides state that they have had productive talks and are in the final stages of negotiating, but the market is weary of rumors and ready for action.
The People's Bank of China has lowered its seven-day reverse repo by 5 basis points to 2.50%, as the world's second-largest economy continues to weaken.
Tomorrow, the US releases Building permits and Housing starts.
EUR/USD on a Daily TF is trading bullish. The price broke above 9EMA and met resistance at the 38.2% Fibo and 50EMA, and is trading around 1.10617. The MACD histogram is falling, the signal lines are narrowing. The Parabolic SAR is preparing to reverse.
Resistance: R1 1.11000 – 1.11086 23.6% Fibo. R2 trend line down around 1.11500.
Support: S1 50% Fibo 1.10293, S2 1.10000 – 1. 09891 61.8% Fibo, S3 1.09717.
Prime Minister Boris Johnson and the Conservative Party are keeping the lead in the United Kingdom general election that is less than a month away - December 12th. Some Sunday’s opinion polls showed that the Tories gained 3 points during last week, now leading 16 points ahead of the Labor party. This week will be exciting for the Sterling. Both, PM Johnson and Labor leader Jeremy Corbyn will address the Confederation of British Industry on Monday, which will be followed by a debate on Tuesday and a separate questionnaire from the audience on Friday.
GBP/USD on a Daily TF is showing that Sterling opened trading with a gap up, but failed to get above the resistance around 1.29849. The Parabolic SAR reversed up. 50EMA crossed 200EMA up. The RSI is at 65.
Resistance: R1 1.30764, R2 1.31765.
Support: S1 1.27735, S2 1.26611, S3 1.25203.
USD/JPY on a Daily TF is showing regained strength, as the price moves back above the trend line up, and it is back above the 200EMA. The Moving Averages are pointing up, The Parabolic SAR are pointing up, The RSI is within the range at 56. The pair is currently trading around 109.044. The US-China trade war and phase one deal are the main drivers.
Resistance: R1 61.8% Fibo 109.362, R2 109.620, R3 110.095
Support: 50% Fibo 108.423, 38.2% Fibo 107.484.