EUR/GBP: stabilization after initial weekly volatility
The EUR/GBP currency pair is slightly strengthening, recovering from a two-day drop and testing the possibility of overcoming the 0.8535 level. Market activity decreased after the stormy initial trading of the week, caused by dynamic changes in the US dollar exchange rate against the background of investors rethinking the Federal Reserve's interest rate strategy. Markets paid special attention to the statements of Fed Chairman Jerome Powell, who called for caution in changing monetary policy, stressing the need to take into account the risks of accelerating inflation.
The latest reports on the state of the British housing sector supported the pound, despite the fact that it is too early to talk about a victory over inflation in the country. The Halifax house price index showed an increase of 1.3% in January, which exceeded both the previous value of 1.1% and analysts' forecasts, which expected an increase of 0.8%. The annual rate has increased from 1.8% to 2.5% over the past three months, reflecting increased confidence in the market due to lower mortgage rates, slowing inflation and stability in the labor market. Today's data from the Royal Institute of Certified Appraisers (RICS) also indicated an improvement from -29.0% to -18.0% in January, which is better than preliminary forecasts of -25.0%. Investors' attention at 17:00 GMT+2 will be focused on the speech of the representative of the Bank of England, Catherine Mann.
- Resistance levels: 0.8546, 0.8562, 0.8582, 0.8611.
- Support levels: 0.8519, 0.8500, 0.8479, 0.8450.
NZD/USD: exploring sloping support and resistance levels
The NZD/USD currency pair stabilized near the value of 0.6112 due to the fall in the value of the US dollar.
New Zealand's economic indicators are helping to strengthen the national currency: unemployment in the fourth quarter rose from 3.9% to 4.0%, which turned out to be better than the expected 4.3%. Wage growth turned out to be slower, falling to 3.9% from the previous 4.1%, but still exceeded forecasts of 3.8%. On the other hand, the US dollar showed weakness, falling to the level of 103.800 on the USDX index, despite the improvement in foreign trade data: exports in December increased from $ 254.3 billion to $258.2 billion, while imports increased from $316.2 billion to $320.4 billion, which led to an expansion of the trade deficit from -61.9 billion up to -62.2 billion dollars.
- Resistance levels: 0.6286, 0.6406.
- Support levels: 0.5986, 0.5799.
Silver price analysis
During the Asian trading session, silver (XAG/USD) is gaining strength after a significant drop at the end of the previous week, approaching the level of 22.30.
Investors are carefully studying US employment data and statements by members of the Federal Reserve System. Recall that the creation of new jobs outside the agricultural sector in January exceeded expectations, reaching 353.0 thousand against the projected 180.0 thousand, with a revision of data for December from 216.0 thousand to 333.0 thousand. Wages increased by 0.6% in January, which contradicted expectations of a slowdown to 0.3%. In this context, Jerome Powell stressed the importance of vigilance in easing monetary policy, pointing to the lack of need to hurry and the need to confirm the downward trend in inflation below 3%. Data from China also introduced uncertainty: the consumer goods price index in January showed a change from -0.3% to -0.8%, which is worse than the forecast of -0.5%.
- Resistance levels: 22.46, 22.70, 23.00, 23.32.
- Support levels: 22.21, 22.00, 21.75, 21.50.
Crude Oil market analysis
Oil prices are holding at $79.73 per barrel amid ongoing tensions in the Middle East region.
Israeli Prime Minister Benjamin Netanyahu recently rejected a Hamas proposal for a cease-fire and the release of hostages in Gaza, thereby confirming predictions about the duration of the conflict. In response, US Secretary of State Anthony Blinken, visiting Israel, expressed the opinion that prospects for negotiations still exist, pointing to the active consultations between the countries on this issue.
Data from the U.S. Commodity Futures Trading Commission (CFTC) showed that over the past week, the volume of net speculative positions in WTI crude oil increased from 184.0 thousand to 196.7 thousand. This trend reflects the growing interest from private investors: the ratio of active bulls to bears among swap dealers was 20,752 thousand against 40,708 thousand, followed by a reduction in the volume of purchase contracts by 0.991 thousand and sale by 3,279 thousand, which indicates the decision of market participants to close short positions.
- Resistance levels: 81.00, 83.86, 88.37.
- Support levels: 77.46, 75.40, 72.98.