Daily Review for January 14, 2021
Important market announcements today: Biden speech, US economic stimulus package announcement and Fed policy statement
Yields of T-Bonds and T-Bills continue to rise. The USD continues to appreciate. Gold with negative outlook
GBPUSD continues to be at its highest level in three years. Traders expect the Bank of England not to move interest rates into negative territory
FTSE 100 with bullish outlook. Analysts evaluate Tesco and Hays as UK economic performance thermometers
DAX 30 rises backed by technical multiples. Fundamental data may slow down the rally
XAUUSD -0.94%
The metal continues its downward trend and is approaching the USD$1,835 support, showing that the Bears have won and are taking gold below the 1,800 level. T-bond and T-bill yields continue to rise. USD continues to appreciate.
Those assets are increasing as a stronger economic stimulus package is expected from the Biden administration. It appears that the stimulus package is close to USD$2 trillion. Traders are aware of Fed Chairman Jerome Powell’s economic policy announcements.
- Support 1: 1838.76
- Support 2: 1836.93
- Support 3: 1835.56
- Resistance 1: 1841.96
- Resistance 2: 1843.33
- Resistance 3: 1845.16
- Pivot Point: 1840.13
Gold is currently trading at USD$1,838 per Troy ounce and is down 0.94% from yesterday. The price broke the 50-day moving average, so the trend is downward. The RSI is at 36. Pivot point at 1840.13.
GBPUSD +0.13%
The currency continues to appreciate, driven by traders’ bullish positions on the GBPUSD. Traders are confident that the Bank of England will not move interest rates into negative territory. Negative interest rates affect the currency and can lead to its depreciation. Analysts are watching the FED and the recent strengthening of the USD.
On the other hand, the UK covid-19 cases are still on the rise, which may affect the currency. The Bank of England must implement a monetary policy strategy in the short term to mitigate the economic impact.
- Support 1: 1.3634
- Support 2: 1.3624
- Support 3: 1.3618
- Resistance 1: 1.3649
- Resistance 2: 1.3654
- Resistance 3: 1.3664
- Pivot Point: 1.3639
The currency is forming an upward channel. It is also above the 15 and 25 day moving average. The next target for the Bulls is 1.3800, with a support at 1.3485. Bullish outlook.
FTSE 100 +0.07%
Today the FTSE 100 is rising and traders are aware of Joe Biden’s speech. The index is currently trading at 6,708. The companies in the eye of investors today are Tesco, which is a thermometer of the UK retail sales and Hays, the recruiting company, which is an indicator of job creation.
- Support 1: 6741
- Support 2: 6736,48
- Support 3: 6730,93
- Resistance 1: 6751,07
- Resistance 2: 6756,62
- Resistance 3: 6761,14
- Pivot Point: 6746,55
The price is above the 50 and 25 day moving average. It is between 61.8% and 78.6% of the Fibonacci retracement level. Bulls are targeting 7,000 resistance level with support at 6,730. Pivot point for a trend reversal at 6746.55. Bullish outlook.
DAX 30 +0.43%
German Chancellor Angela Merkel announced that she is considering extending the lockdown until Easter. Her team announced that, if the numbers of infections, intensive care units and deaths do not improve, they will announce stronger restrictions to the population.
The European Union also announced that Member States should accelerate vaccinations, as the number of infections globally continues to rise.
- Support 1: 13934.93
- Support 2: 13930.15
- Support 3: 13920.59
- Resistance 1: 13949.27
- Resistance 2: 13958.83
- Resistance 3: 13963.61
- Pivot Point: 13944.49
The price continues to rise above the support of 13.829, indicating possibilities of upward movement of the index. The RSI is at 60, entering the overbought zone. If the index manages to break the 14,000 resistance, we could see it heading towards the 61.8% of Fobonacci at 14,316. In the bearish scenario the index would fall to 13,560 corresponding to the 34 day moving average.
Sources
- Reuters
- Market watch
- Bloomberg
- Capitalix Market Research
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