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Nov. 27: Asian session

EUR/USD closed yesterday above resistance at $1.3560 and rose to $1.3600 today. Euro rose to the highest level this month as Asian stocks erased losses and lawmakers in Germany (Angela Merkel’s Christian Union party and the Social Democrats) reached a coalition accord on wages and spending increases. Traders also think that data this week may show a pickup in inflation, reducing the need for the ECB to expand monetary easing. GfK German consumer climate will be released at 09:00 GMT. In the US watch for durable goods orders (forecast: 0.5%; previous: -0.2%) and unemployment claims at 13:30 GMT. GBP/USD is consolidating in the $1.6215 area after it gained about 60 pips yesterday. Cable awaits UK GDP data (second estimate is due at 09:30 GMT).

USD/JPY has formed a bearish engulfing candle with a low at 101.15 on Tuesday, but today has recovered into the 101.60 area. The pair still remains below the Monday’s 6-month high of 101.90. The Nikkei 225 index eased by 0.3% today, slipping from the 6-month peak touched on Monday. USD/CHF slid on Tuesday to 0.9060 and is trading in this area now after it met resistance at 0.9079 earlier today. 

Commodity currencies have found some support on the news that China was working on a system of deposit insurance. The pair AUD/USD is consolidating in the $0.9100/30 range after having dipped to $0.9190 yesterday. It is interesting to note that Australia’s Bureau of Resources and Energy Economics confirmed slowing of mining investment in the country. NZD/USD is swinging in the $0.8170/8200 range. New Zealand October trade deficit came out lower than expected (168M vs. expected 350M).

USD/CAD is trading on the upside in the 1.0550 area. Yesterday there was a spinning top formed on the daily chart – this formation indicates indecisiveness of the market players. The greenback’s below this week’s high in the 1.0580 zone. Canadian Dollar traded at almost a 4-month low as the price of crude oil, the nation’s biggest export, fluctuated.

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