Investors Brace For Hawkish Fed Minutes
ORBEX | Feb 21, 2018 03:03AM ET
The U.S. dollar continued to rise higher on Tuesday as the U.S. markets opened after a long weekend. Economic data was sparse for the most part. The USD managed to remain strong as investors focused on the upcoming FOMC meeting minutes.
In the eurozone, the ZEW economic sentiment survey showed that German economic sentiment rose to 17.8, beating estimates of 16.0 while the eurozone economic sentiment was also higher at 29.3. However, both the indexes were weaker compared to the previous month.
Looking ahead, the FOMC meeting minutes today will stand out amid a somewhat busy day ahead. Data from the eurozone will cover the flash manufacturing and services PMI figures for February.
In the UK, the monthly jobs data will be coming out. No major changes are expected as economists forecast that the UK's unemployment rate will remain unchanged at 4.3%. Wage growth is also expected to remain broadly stable.
EURUSD intra-day analysis
EUR/USD (1.2331): The EUR/USD continued to post declines for the third consecutive day yesterday. However, price action is limited within the range established in the past month. Currently, the pair is seen consolidating near the support level of 1.2363 - 1.2333 region. There is a potential for EUR/USD to post a rebound of this level. This could send it back to test the minor resistance level at 1.2443. Alternately, if EUR/USD breaks past the support level, the declines could see it falling to the 9 February lows of 1.2205 where support could be established. Further downside momentum could see EUR/USD testing the major support level at 1.2090 - 1.2070.
GBP/USD intra-day analysis
GBP/USD (1.3985): The GBP/USD closed with a doji yesterday but price action remains biased to the downside, targeting 1.3902. For the moment, the consolidation taking place at the current levels could indicate further declines on a break down below 1.3902. In the event that GBP/USD breaks below this support level, we expect to see the declines being extended down to 1.3611 - 1.3589 level of support where price action is yet to retest the support at this zone. To the upside, the gains are capped near the previous resistance level of 1.4127.
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NZD/USD intra-day analysis
NZD/USD (0.7334): The New Zealand dollar has been gradually posting a decline with price action now trading close to the 0.7333 level of support. As long as the support holds NZD/USD could remain biased to the upside. However we expect the pair to consolidate within the range of 0.7388 and 0.7333 region. This sideways consolidation could see NZD/USD likely to break down to the downside targeting the lower support at 0.7160. To the upside, if it clears the upper range of 0.7388, then we can anticipate further gains in the near term.
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