Weak sales of existing homes (down 2.7% for October) drove the dollar lower yesterday, despite an otherwise robust housing sector, with prices up 16% on the year. The dollar fell to 1.7340 overnight. Most analysts are nevertheless brushing off yesterday’s rally, saying that the market will bring interest rates back into focus, and that the dollar’s yield advantage will provide support.
The slew of data out this week should tell us whether the dollar will remain weak or rebound against the euro and sterling. The most important figures out will be US Durable Goods orders (today 13:30), Q3 GDP (Wed, 13:30), Chicago PMI (Wed 15:00) and ISM Manufacturing (Thursday 15:00).
UK House Prices were flat on the month in data releases at 07:00 this morning.
GBP USD – Support 1.7210 then 1.7150
Resistance 1.7300, then 1.7345
GBP EUR – Support 1.4535/50 then 1.4500
Resistance 1.4650 then 1.4742
DATA: UK Consumer credit and Mortgages (09:30)
US Durable Goods (13:30)
US Consumer Confidence (15:00)
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