19 Dec: WTI falls heavily again. Elsewhere, choppy ahead of today’s FOMC decision.

By | December 19, 2018

 

It has been a choppy day for the dollar, which has recovered from a minor selloff after Donald Trump continued with his verbal intervention on Fed policy, ahead of the Interest Rate Decision due later today. At the end of the session, the currencies are largely unchanged although Cable has firmed up a little.

In terms of data, capping the Euro, the German IFO Business Climate dropped for the fourth straight month to 101.0 in December, down from 102.0 and missed expectation of 101.7. The Current Assessment gauge dropped to 104.5, down from 105.5 and missed expectation of 104.9. The Expectations gauge dropped to 97.3, down from 98.7 and missed consensus of 98.2. In the US, the Building permits and Housing Starts both beat expectations.

Elsewhere, US stocks have given up an early rally that saw gains of 1.0%/1.5% and are currently +0.1/0.3%. WTI has been the big loser again though, down another 7%, currently at 46.25 and looking headed towards major Fibo support at 45.50.

Wednesday will be another busy session although conditions are likely to stay choppy and rangebound until late in the day when the FOMC decision is released, at which a rate hike is widely expected, and possibly more importantly, what the Fed thinks about the growth path/dot-plot for 2019. Assuming a rate hike, traders will therefore spend most of their energy on the words of the Chair, Jerome Powell in his Q/A at the press conference. Before then the session will begin with the NZ Q3 Current Account and Q4 Consumer Confidence figures, while Australia will have the November Leading Economic Index. Europe will look to the German PPI (exp 3.2%yy) and to the UK CPI, PPI, RPI (exp CPI ; 0.2%mm, 2.3%yy, Core;1.8%yy) while the US, aside from the Fed, will also have the November Existing Home Sales  (exp 5.2 mio,-0.6%). Have a good day.

Economic data highlights will include:

Wed: NZ Current Account, Consumer Survey, Australian WBC Leading Economic Index, Japan Merchandise Trade Balance Imports/Exports, German PPI, UK CPI, PPI, RPI, EU Construction Orders, UK CBI Distributive Trends Survey – Realised, US Existing Home Sales, EIA Crude Oil Stocks Weekly Change, FOMC Meeting/IR Decision, Press Conference, Fed’s Powell Speech

CURRENCIES
EURUSD: 1.1360
Res  1.1405  1.1440  1.1475
Sup  1.1335  1.1305  1.1270
USDJPY: 112.53
Res  112.80  113.00  113.25
Sup  112.25  112.00  111.75
GBPUSD: 1.2640
Res  1.2655  1.2670  1.2695
Sup  1.2615  1.2590  1.2565
USDCHF: 0.9927
Res  0.9950  0.9985  1.0010
Sup  0.9890  0.9860  0.9825
AUDUSD: 0.7175
Res  0.7195  0.7210  0.7225
Sup  0.7165  0.7150  0.7130
NZDUSD: 0.6844
Res  0.6860  0.6880  0.6900
Sup  0.6825  0.6805  0.6780
INDICES / COMMODITIES
S&P.fs: 2543.78
Res  2560.00  2580.00  2605.00
Sup  2530.00  2505.00  2485.00
DJ30.fs: 23671.00
Res  23790.00  23940.00  24035.00
Sup  23535.00  23450.00  23300.00
SPI200.fs: 5510
Res  5525  5555  5575
Sup  5500  5480  5460
XAUUSD: 1248.99
Res  1250.00  1255.00  1260.00
Sup  1245.00  1240.00  1235.00
XAGUSD: 14.63
Res  14.75  14.90  15.05
Sup  14.50  14.35  14.20
WTI.fs: 46.59
Res  47.15  47.85  48.50
Sup  46.10  45.50  44.80