EURUSD, H1
Italy sticks to spending plans, according to Prime Minister Conte, who said the upcoming negotiations with the EU won’t be easy as the government intends to stick to its pending plans. Conte said he tole EU’s Moscovici that “social stability counts more than that of finances”. Italian bond yields continue to back up on the report, after already starting to move higher again amid a flurry of headlines first suggesting that the deficit target may be lowered, then questioning this again. The 10-year yield is up 0.8 bp at 3.293%, the ripple through to the EUR pulled EURUSD down sub 1.1270 and EURJPY under 128.25. The slightly weaker than expected German GfK added to the downside bias for the common currency. Richard Clarida’s speech yesterday added to the USD bid, could Governor Powell later today, cool the USD gain? Consensus is that he will re-iterate the gradual approach to rate hikes over the coming months with the emphasis on the data. Currently the CME Group has the chance of a rate hike at the next FED meeting back close to 80% at 79.2%. Details can be found here http://goo.gl/ajJkYa
EURUSD remains under its 20 day moving average, with the current month low sitting at 1.1216 (November 12). The H4 and daily time frame turned lower again last Friday (November 23) following a flirt higher the previous week to 1.1450.
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Stuart Cowell
Head Market Analyst
HotForex
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