FxWirePro: Forex Daily Update

20 December 2023, 07:46

The US dollar index showed a minor sell-off amid mixed US housing data. Housing starts in the US rose 14.80% in Nov to 1.56 million and single-family housing starts surged 18% highest level since May 2022. US building permits declined 2.5% from the revised Oct rate of 1498000.

  According to the CME Fed watch tool, the probability of a 25 bpbs rate cut in Jan increased to 10.3% from 4.0% a week ago.

 The US 10-year yield is trading weak for the 8th consecutive week as the Fed prepares for a rate cut. The US 10 and 2-year spread narrowed to --51% from -39%.

Major resistance- 102.65/103.20

Major support- 101.70/101.

EURUSD-

EURUSD showed a minor pullback after hitting a low of 1.0884. Eurozone CPI came at 2.4% yoy in Nov, down from Oct 2.9% yoy. Investors eye German PPI for further direction.

Major resistance- 1.0965,1.1020

Major support- 1.08600,1.0800

Yen-

USDJPY pared some of its gains despite the dovish BOJ policy stance. The central bank kept its rates and forward guidance unchanged.

Major Resistance- 144,145

Major support- 143,142.20

Pound sterling

The pound sterling is trading flat ahead of UK CPI. Any weak inflation data will push GBP prices further lower.

Major Resistance- 1.2765,1.2800

Major support- 1.2650,1.2600

Economic calendar -

Dec 20th, 2023, UK CPI y/y (7 am GMT)

           US CB confidence (3 pm GMT)