By Samir Al Khoury

The most important events of the past week

United States of America

·        The Fed’s minutes of the January meeting were issued, the most prominent of which were:

·        Fed members unanimously agreed on the need for additional evidence indicating a decline in inflation to the 2% level before starting to adopt an accommodative policy.

·        Federal Reserve members unanimously agreed that interest rates have likely reached their peak, but the timing of the first cut is still unclear.

·        The majority of Fed members pointed out the dangers of shifting to accommodative policy too quickly.

·        The unemployment claims rate index declined, recording 201K, which is lower than expectations (217K) and the previous reading (213K).

·        The Manufacturing Purchasing Managers’ Index rose to 51.5 points, which exceeded expectations (50.5) and the previous reading (50.7).

·        The services PMI declined, recording 51.3 points, which is lower than expectations (52.4) and the previous reading (52.5).

·        The existing home sales index rose, recording 4 million, which exceeded expectations (3.96M) and the previous reading (3.88M).

·        US oil inventories fell, recording 3.51 million barrels, which is lower than expectations (3.88M) and the previous reading (12.02M).

Eurozone

·        The Consumer Confidence Index rose, recording -15.5 points, which exceeded expectations (-16.0) and the previous reading (-16.1).

·        The services PMI rose, recording 50.0 points, which exceeded expectations (48.8) and the previous reading (48.4).

·        The Manufacturing PMI declined, recording a contraction of 46.1 points, which is lower than expectations (47.0) and the previous reading (46.6).

·        The headline consumer price index recorded on an annual basis 2.8%, which is in line with expectations but lower than the previous reading (2.9%). The core consumer price index (which excludes food and energy) recorded 3.3% on an annual basis, which is in line with expectations but lower than the previous reading (3.4%).

United Kingdom

·        The Services Purchasing Managers’ Index rose, recording a growth of 54.3 points, which was higher than expectations (54.2) but consistent with the previous reading.

·        The Manufacturing PMI declined, recording a contraction of 47.1 points, which is lower than expectations (47.5) and the previous reading (47.0).

Canada

·        The Consumer Price Index decreased on an annual basis, recording 2.9%, which is lower than expectations (3.3%) and the previous reading (3.4%).

Australia

·        The services Purchasing Managers’ Index rose, recording a growth of 52.8 points, which is higher than the previous reading (49.1).

·        The Manufacturing Purchasing Managers’ Index declined, recording a contraction of 47.7 points, which is a lower percentage than the previous reading (50.1).

China

·        The People’s Bank of China reduced interest on 5-year mortgages from 4.20% to 3.95%.

Japan

·        The services Purchasing Managers’ Index (PMI) declined, registering a growth of 52.5 points, which is a lower percentage than the previous reading (53.1).

·        The Manufacturing PMI declined, recording a contraction of 47.2 points, which is lower than expectations (48.2) and the previous reading (48.0).

The most important events of this week

This week, financial markets are eagerly awaiting the release of several key economic indicators:

·        Building permits and new home sales indices in the United States of America are released today.

·        On Tuesday, the markets await the consumer price index in Japan and the durable goods orders and consumer confidence indices in the United States of America.

·        On Wednesday, the interest rate decision will be issued by the Central Bank of New Zealand, amid expectations that it will keep the interest rate unchanged at the level of 5.50%. It also issues indicators of gross domestic product and US crude oil inventories in the United States of America.

·        On Thursday, the industrial production and retail sales indices in Japan, retail sales in Australia, the gross domestic product index in Switzerland and Canada will be released, in addition to the core personal consumption expenditures price indices, initial jobless claims, and pending home sales in the United States of America.

·        Finally, on Friday, the manufacturing and non-manufacturing purchasing managers’ indices in China, the manufacturing purchasing managers’ index in each of the Eurozone, Britain, and the United States of America, the consumer price indices and the unemployment rate in the Eurozone, in addition to the indicators of construction spending and industrial purchasing managers issued by the Institute for Supply Management (ISM) and Michigan Consumer Confidence in the United States of America.

Technical Analysis:

EUR/USD:
If the euro against the dollar breaks the pivot point of 1.0821, it may potentially target and test the support levels of 1.0755, 1.0695, and 1.0629. Conversely, if it surpasses the pivot point, it is likely to test resistance levels of 1.0882, 1.0948, and 1.1009.

GBP/USD:
The pound against the dollar, if it breaks the pivot point of 1.2649, has the potential to test the support levels of 1.2590, 1.2519, and 1.2459. However, if it exceeds the pivot point, it may test resistance levels of 1.2720, 1.2779, and 1.2850.

USD/JPY:
If the pivot point of 150.30 is broken for the dollar against the yen, there is a possibility that it will target the support levels 149.85, 149.22, and 148.76. But if it exceeds the pivot point, it is likely to target the resistance levels 150.93, 151.39, and 152.02.

GOLD:
If the pivot point of 2042 is broken for gold, there is a possibility that it will target the support levels 2031, 2012, and 2001. But if it exceeds the pivot point, it is likely to target the resistance levels 2060, 2071, and 2089.

BRENT CRUDE OIL:
If the pivot point of 82.34 for crude oil is broken, there is a possibility that it will target the support levels of 80.72, 79.81 and 78.19. If it exceeds the pivot point, it is likely to target the resistance levels 83.25, 84.87, and 85.78.

US30:
If the pivot point of 38,977 for the Dow is broken, there is a possibility that it will target the support levels 38,611, 38,034 and 37,668. If it exceeds the pivot point, it is likely to target the resistance levels 39,554, 39,920, and 40,497.

Please note that this analysis is provided for informational purposes only and should not be considered as investment advice.

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