Range Markets

The US dollar index started the year on a high note. The index, which measures the strength of the dollar against a basket of currencies, rose by 10 basis points. The currency had a weak December as traders started to price-in the December statement by the Federal Reserve. The bank guided that it would leave rates unchanged this year. Today, the market will read more about the decision as the Fed is expected to release the minutes of the meeting. The market will also receive the first initial jobless claims of the year.

The euro was relatively unchanged in the Asian session. The euro rose sharply against the USD in the final week of the year. This was mainly because traders started to place their bets that the EU economy would recover in 2020. Today, the market will receive the PMI data from European countries. The Spanish manufacturing PMI is expected to have dropped from 47.5 to 47.0 while the German manufacturing PMI is expected to have remained unchanged at 43.4.

Asian stocks rose on the first day of trading. In China, the Shanghai index rose by 37 points while the China A50 index rose by 160 points. This was mostly because of the current optimism of trade. In an interview on Tuesday, American economist Peter Navarro said that the deal with China has already been reached. Trump is expected to sign the deal this month. Meanwhile, the market received relatively weak PMI data from China. The data by Caixin showed that the manufacturing PMI declined to 51.5 from 51.8. This was after similar data by China Logistics showed that the PMI rose in December.


The EUR/USD was relatively unchanged today. The pair is trading at 1.1212, which was slightly lower than last week’s high of 1.1240. The price is slightly below the middle line of the Bollinger Bands. The volume indicator shows that volumes are still low. The recent trends show that the pair may continue moving lower.


The XBR/USD pair was relatively unchanged during the Asian session. The pair is trading at 66.00, which is lower than last week’s high of 67.40 and slightly higher than last week’s low of 65.45. The price is below the 14-day and 28-day moving averages. It is also slightly below the Ichimoku cloud. The pair might move lower to test the important 50% Fibonacci Retracement level of 65.00.


The GBP/USD pair declined to a low of 1.3205. This price is slightly below the middle line of the Bollinger Bands and below the overbought level of 70. The signal line of the MACD has been moving lower. The price might move lower after it established a double top pattern at 1.3285. If it does, it will likely move below 1.3200.

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