21.11.13- The Dollar strengthened because of the Fed
Trading on the U.S. stock markets ended with decrease major indexes. Statistics on the housing market in the United States did not help the bulls. Thus, the number of existing home sales in October fell to 5.12 million from 5.21 million in September. Sales are reducing for the second month in a row, showing the weakness of the real estate market. Besides, the U.S. Department of Commerce has published data on the volume of inventories. In September, inventories rose 0.6% after increase for 0.4% in August. This figure is very important for evaluation of the real situation in the economy. Rising inventories can cause a chain of negative events. As a result, the S&P is again below the resistance level of 1800, and as expected, reached the level of 1780. The following goals in case of decrease are at the levels 1763 and 1747. This morning futures on U.S. and European indices show a moderately negative mood of pl FOMC statement did not bring anything unexpected. Improvement in the economy will allow to start reducing the purchase of assets in the coming months, and when it will start is not known. On this news, the euro broke an upward inclined support line and fell to the level of 1.3410. We expect the correction of the pair to the level of 1.3440, after which the decline can resume. The price can reach the next line of support at 1.3400 and 1.3360. Important piece of news yesterday was the announcement that the ECB is considering the introduction of negative interest rates on deposits at the level of -0.1%. Trading on the European markets finished with mixed dynamics. Analysts at Barclays upgraded recommendation on the largest retail network in Germany - Metro to 'buy', because of this shares have risen on 2.4%. The reason for increasing the forecast is an expectation of sales growth in key directions. After the euro, that decreased, the British pound also slipped down. The price of a pair reached the support level 1.6080, and it might continue to decrease to the levels of 1.6050 and 1.6000. In the case of correction a pullback is probable to the level of 1.6115. USD/JPY has risen against the dollar and reached the strong resistance line at 100.40. Next target is 101.50. In case of correction the price may drop to 100.25. After consolidation, we expect the upward movement to continue. The weakening of the yen this morning resulted in confident growth of the stock market in Japan. Strengthening of the dollar led to a decrease of the Australian dollar. The price is traded at the level of 0.93. We see a support strong level at 0.9280, after overcoming of which the way is open to 0.92. The course of trading today will be influenced by the Flash Manufacturing and services PMI in France (08:00 GMT), Germany (8:30 GMT) and the euro area as a whole (9:00 GMT). In the Spotlight will also be the U.S. labor market. At 13:30 GMT, will be published a data on unemployment claims in the United States. At the same time will be released the producer price index. We should also pay attention to the speeches of FOMC members Jerome Powell and James Bullard. Despite the increased volatility, oil prices cannot find a firm direction. Today, will take place negotiations between the IAEA and Iran on the nuclear program of the country. Their results will determine where exactly the price will move to. In the case of a positive outcome, Iran will be able to ship oil to the world markets, which will lower the price of "black gold." Stocks of SPDR Gold Trust - the world's largest gold exchange-traded fund, fell yesterday by 1.5 tons to 863.01 million tons, reaching thus the lowest level since February 2009. Strengthening of the dollar pulled the price of gold down, besides yesterday was published a data on gold production in China. During the 9 months of 2013 it was produced 307.809 tons, which is 6.8% more than the year before. After correcting the price may go further down to support levels 1220 and 1200. Resistance is at around 1265.