‘All time high’ is the word that we are hearing frequently for the past couple of months and there is always a new all-time high, right after another. Yes, the U.S. stock market is currently testing another record high level of 1790 where its next target might be 1800 provided it manages to move above 1795. It is all because of the continuous flow of monetary easing in the U.S. economy by the Federal Reserve, which they are not backing out at least for now.
The to-be-appointed chairman of the Federal Reserve, Janet Yellen, reiterated her remarks on the economy yesterday as well where she sees greater room for improvement and that could come by continuing the $85 billion bond buying plan at least until March 2014.
Support all around
The major pairs including the euro and the pound put pressure on the U.S. dollar and entered the short term bullish channel where they have several supports clustered with each other. The Eur/Usd is currently hovering at the 1.3453 level where 1.3440, 1.3429 and 1.3407 are its supports that may hinder the sellers to enter the market, unless the inflation numbers of the Eurozone come out to be really bad.
Buyers should feel safe as long as the pair is trading above the 1.3400 psychological support level; however, sustaining below this level could allow the sellers to eat away the gains of the past few days quite quickly.
Firm as a Rock
There doesn’t seem to be any coming back of the pound as of now, where the pair has gripped a firm movement above 1.6000 level and would target to re-test and break 1.6100 level today. However, a move below 1.6050 could take it down to 1.6022 and 1.5995 where buyers may enter the market again.
There is no fundamental due for the GBP today, but investors must be eying on the manufacturing index, capacity utilization, and import prices data of the U.S. that are set to be released earlier in the U.S. session.
Gold in Range
Gold on the other hand is still in a short range and failed to move above 1291, but if the U.S. economic indicators do not meet expectations today then gold would target to test the 1300 resistance level before Friday’s closing.
To contact the reporter of this story: Jonathan Millet at email@example.com