News
- Germany reported weaker factory orders for December, adding fuel to Deutsche Bank’s argument that the country is heading into recession. Germany’s Economic Ministry also expects weakness to persist at the start of 2019.
The focus of attention
- Markets are expecting to react to the SOTU speech on Tuesday evening and the remark by Bundesbank President that he is expecting significantly lower growth in 2019 due to uncertainties with Brexit, the trade war between U.S. and China, and growth deceleration in China.
Expected events. All times GMT.
- 13:30 U.S. will release November trade figures.
- 15:30 U.S. will release weekly oil inventory figures.
Technical Analysis
- GBP/USD weakened markedly yesterday and stopped at a lower support level of 1.2938. There was a brief counter-trend bounce but which quickly found resistance and the pound hit the earlier support level for a second time this morning. The limiting factor appears to be momentum resistance at an RSI of 50. Which means, we could see further weakness if this level is not breached in today’s session.
- EUR/USD is having a negative February so far with the current slide taking a break at the 1.1386 price level which is providing some kind of support. We would, however, expect the slide to continue if RSI is unable to break the 47% mark this week.