The dollar index (KTM: DXY) was little down on Tuesday, traced out a near-term price top via the formation of a double top pattern at 97.70. The calendar data saw plenty of releases starting with UK January GDP and US inflation.
- UK GDP grew by 0.5% in January 2019 rebounded from -0.4% in December 2018. Services, production, manufacturing, and construction all experienced positive month-on-month growth in January 2019 after contracting in December 2018, according to ONS.
- In the US, CPI increased 0.2% in February on a seasonally adjusted basis after being unchanged in January.
On top of these data events, the latest developments of Brexit occupied the headlines. The cable swung nearly 300 points on Tuesday with the result of the Parliamentary vote. The British Parliament voted to reject Prime Minister May’s Brexit agreement. The pound traders and the lawmakers debate tend to focus on the challenges facing ahead of the March 29 deadline.
“One way or another, an extension to the Article 50 period looks likely” James Smith at ING reported. He also said that “there is a sense that most leaders are fairly open to an extension, although a lot hinges on the European Parliamentary elections due to take place in late-May.”.
Looking ahead, the calendar is empty in Asia except. In Europe, we will see EA IP but not a market mover, and in the US we will see Durable goods and PPI.
Just in: Aussie dollar down 0.30% this morning on weak consumer mood.
Westpac: Consumer sentiment falls on weak growth figures. The consumer mood deteriorated in March, sentiment falling to 4.8% to 98.8 in March from 103.8 in February, its lowest level since September 2017.
Chart of the day: USDCHF
USDCHF traced out a near and medium-term price top near 1.0125 in mid-November 2018 and early March 2019 via the formation of a double-top pattern. The trend remains bullish whereas the supporting indicators are bearish. The RSI breakout is needed to forecast fresh bullish forecast 1.0240 and 1.0330 levels. Support finds at 1.0060,0.9980 and 0.9920/0.9900.
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