LIGHT MONDAY SCHEDULE KICKS OFF ACTIVE WEEK IN THE MARKET
A steady stream of economic data will make its way through the financial markets on Monday, giving investors a taste of what’s to come later in the week.
The European calendar begins at 08:00 GMT with a report on Spanish unemployment. Later in the morning, Markit and the Chartered Institute of Purchasing and Supply will release the latest UK construction PMI.
At the same time as the PMI release, Sentix will unveil its December investor confidence indicator covering the Eurozone. As the name implies, the monthly release conveys a snapshot of market opinion about the current economic situation in the currency region.
Earlier in the day, the University of Melbourne reported a 0.2% uptick in Australia’s inflation rate last month. That followed a gain of 0.3% the previous month. In annualized terms, this translated into 2.7% growth.
Later in the session, the European Commission will release the latest producer inflation report for the Eurozone.
The only noteworthy North American release takes place at 15:00 GMT when the US Commerce Department unveils the latest factory orders report.
The Australian dollar was little changed against its US counterpart Monday, with the AUD/USD holding just above 0.7600. The pair broke out of a weeklong slump on Friday to reach a high of 0.7634. The technical picture remains neutral, with 0.7640 offering the key short-term resistance. That level continues to limit major upside moves for the pair. A break above this level would lead to a test of the 0.7700 region. On the opposite side of the spectrum, immediate support is located at 0.7595, followed by 0.7530, which corresponds with the November low.
The euro fell further below 1.1900 US on Monday, as investors awaited a deluge of fundamental indicators later in the week. The common currency has made a series of up moves in recent weeks, but is finding it difficult to return back above 1.2000 US. At last check, the EUR/USD was trading around 1.1872 for a loss of 0.2%. From a technical perspective, immediate support is located at the 1.1860 level, followed by 1.1820. On the opposite side of the ledger, resistance is likely found at 1.1930, followed by 1.1960.
Cable has enjoyed a surge of momentum in recent weeks as investors shrugged off Brexit risks. The GBP/USD traded as high as 1.3548 on Friday before giving back most of its gains subsequently. At press time, the pair was seen trading at 1.3469. Cable is testing its immediate support level of 1.3450. A further breakdown below this level would expose 1.3420 as the next target. In terms of resistance, the first line of contention is offered at 1.3505, followed by 1.3550.