Daily Market Review 12/11/13

Euro (EUR)

The Euro gained against the other majors over speculation that the German Consumer Price report will beat expectations. The ECB Vice President Constacio said last month that policy makers are “not really near a decision” on a negative deposit rate. The French Industrial Production came out worse than expected at -0.30% vs. 0.20%. Technically, according to the 4-hour chart, the EUR/USD is moving in an Ascending Channel with the pair currently at the top of the channel and a retracement towards 1.3670 expected. The RSI indicator is near overbought levels also supports the expected retracement as well.

US Stock Market

Wall Street finished the trading day down amid growing uncertainty over the Federal Reserve's budget negotiations. The S&P 500 dropped by 0.32%, the NASDAQ declined by 0.20% and the Dow Jones lost 0.33% from its value. Technically, according to the 1-hour chart using Fibonacci Retracement, the Dow Jones touched the support level of 15,955 and jumped back above the 16,000 level, signalling which signals a strong bullish trend. Holding above the support level of 15,955 could lead the index towards 16,050.

Gold

Gold rose by 1.81% on Monday, closing at $1,260 an ounce, with the weakness of the greenback boosting demand for gold as an alternative investment. Technically, according to the weekly chart, gold is holding above the critical support level at $1,250, which is also the top of last week's Reversed Candle. and it seems like gold's momentum could continue to be positive. Holding above the support level of $1,250 may also lead the precious metal towards the $1,292 resistance level once again.

USD Dollar (USD)

The US Dollar fell slightly versus most of the majors as investors await the Federal Reserve's decision to begin tapering its USD85 billion monthly asset purchases, and is expected to keep the negative momentum until this decision is announced. The JOLTS Job Opening came out as expected at 3.93M. Today, the Federal Budget Balance is expected at -142.60B vs. 91.60B previously, and the 10-y Bond Auction also due for release.