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  • The US Dollar seems to be back on the offensive against its major counterparts, pressuring EUR/USD and NZD/USD lower as USD/JPY consolidates. USD/CHF surges past key resistance. Get your market update from @ddubrovskyFX here:https://t.co/MrLGSp7FYa https://t.co/XS0176LyOg
  • The Japanese Yen remains in focus with strength potential on risk aversion themes to go along with weakness on themes around higher rates. Get your weekly $JPY technical forecast from @JStanleyFX here: https://t.co/l4UICqJzJy https://t.co/dQ2pS0E4fp
  • Google finance-related search interest in 'Evergrande' has almost overtaken 'Covid'. 'Taper' doesn't even register on the scale https://t.co/P6H9sHFVIB
  • Gold prices gain as potential systemic risks out of China's Evergrande Group roil broader markets. Meanwhile, iron ore is ticking higher after a big drop on Monday as China steps up steelmaking curbs. Get your market update from @FxWestwater here:https://t.co/l4kAWDJ2wm https://t.co/b9m5ADIqqb
  • Gold remains higher despite positive Evergrande news out of China. Meanwhile, copper bulls are pushing prices upward as the potential for a housing crisis in China ebbs. Get your market update from @FxWestwater here:https://t.co/TK3MNntBdA https://t.co/14UKjR4w6M
  • GBP/USD has flattened overnight after its strongest rally in a month on Thursday. The British currency has been under pressure recently as an energy crisis has caused a number of gas providers to go bankrupt. Get your market update from @HathornSabin here:https://t.co/3D8s2eIVWv https://t.co/JDGNwKYyOn
  • Japanese candlesticks are a popular charting technique used by many traders, and the shooting star candle is no exception. Learn about the shooting star candlestick and how to trade it here: https://t.co/mfwJ0sIauS https://t.co/JIT5it2HAt
  • Gold could suffer further near-term losses due to rising U.S. Treasury yields and a weak technical picture for price action. Get your weekly gold forecast from @DColmanFX here: https://t.co/g9QvH3L4It https://t.co/Vz98E0Bl9U
  • Gold has been trending lower after failing to clear resistance in the $1835 area earlier this month. Get your $XAUUSD market update from @DColmanFX here:https://t.co/3hm1g3BHgf https://t.co/MdTQKEBCBx
  • Key break here in the 10-year #Treasury yield as it rises to the highest since late June Took out 1.4230 resistance, and the 100-day SMA Eyes now on the 38.2% Fib extension at 1.4775 Also potential falling resistance from March https://t.co/4cI6l210ui
British Pound Gains as Supreme Court Weighs Brexit Appeal

British Pound Gains as Supreme Court Weighs Brexit Appeal

Ilya Spivak, Head Strategist, APAC

Talking Points:

  • British Pound gains as UK Supreme Court weighs Brexit appeal
  • Aussie Dollar ignores status-quo RBA, falls on net exports data
  • Euro likely to ignore revised 3Q GDP data as ECB looms ahead

The British Pound edged higher overnight in a move that may reflect building hope for a “soft” Brexit, meaning a UK break from the EU that retains the departing country’s access to the single market. Investors are waiting for a Supreme Court ruling on whether the government needs Parliament’s say-so before formally triggering an exit from the regional bloc.

Reports making the rounds on the wires suggested the administration’s lawyer was battered by the court’s 11 judges in the first day’s hearing. Meanwhile, a faction within Prime Minister May’s own Conservative party appeared to back rival Labour’s plan to force the administration to reveal its Brexit strategy before activating Article 50 of the Lisbon Treaty, which starts a 2-year countdown toward a rupture.

The Australian Dollar underperformed after data unexpectedly showed that net exports shaved 0.2% from GDP in the third quarter. The currency declined alongside front-end bond yields, suggesting the outcome stoked a dovish shift in monetary policy bets. A status-quo RBA rate decision passed almost entirely unnoticed.

Sellers will look for further evidence to support the case for easing in tomorrow’s release of the full third-quarter GDP report. The data is projected to show that the economy added just 0.2 percent in the three months through September. The year-on-year trend growth rate is seen falling to 2.5 percent. Taken together, this amounts to the weakest performance since mid-2015.

Looking ahead, the final revision of third-quarter Eurozone GDP figures is unlikely to inspire a strong reaction from the Euro as traders wait for the ECB rate decision due later in the week. The announcement is expected to deliver significant changes to the central bank’s stimulus effort. Extending QE and broadening the scope of eligible assets may emerge. Some traders also still seem to entertain a “tapering” scenario.

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Asia Session

GMT

CCY

EVENT

ACT

EXP

PREV

21:00

NZD

ANZ Truckometer Heavy (MoM) (NOV)

4.0%

-

-0.4%

22:30

AUD

ANZ Roy Morgan Weekly Consumer Conf

118.6

-

115.4

0:00

JPY

Labor Cash Earnings (YoY) (OCT)

0.1%

0.2%

0.2%

0:00

JPY

Real Cash Earnings (YoY) (OCT)

0.0%

0.2%

0.9%

0:01

GBP

BRC Sales Like-For-Like (YoY) (NOV)

0.6%

1.7%

1.7%

0:30

AUD

BoP Current Account Balance (3Q)

-A$11.4b

-A$13.5b

-A$15.9b

0:30

AUD

Net Exports of GDP (3Q)

-0.2

0.0

-0.2

3:30

AUD

RBA Cash Rate Target

1.5%

1.5%

1.5%

European Session

GMT

CCY

EVENT

EXP/ACT

PREV

IMPACT

7:00

EUR

German Factory Orders (MoM) (OCT)

6.3% (A)

-0.3%

Medium

7:00

EUR

German Factory Orders WDA (YoY) (OCT)

-0.2% (A)

2.9%

Medium

8:15

CHF

CPI (MoM) (NOV)

-0.3% (A)

0.1%

Medium

8:15

CHF

CPI (YoY) (NOV)

-0.3% (A)

-0.2%

Medium

8:15

CHF

CPI EU Harmonized (MoM) (NOV)

-0.2% (A)

0.1%

Low

8:15

CHF

CPI EU Harmonized (YoY) (NOV)

53.9 (A)

-0.3%

Low

8:30

EUR

Markit Germany Construction PMI (NOV)

6.3% (A)

52.9

Low

9:10

EUR

Markit Germany Retail PMI (NOV)

-

51.0

Low

9:10

EUR

Markit Eurozone Retail PMI (NOV)

-

48.6

Low

9:10

EUR

Markit France Retail PMI (NOV)

-

47.5

Low

9:10

EUR

Markit Italy Retail PMI (NOV)

-

46.5

Low

10:00

EUR

Eurozone GDP SA (QoQ) (3Q F)

0.3%

0.3%

Medium

10:00

EUR

Eurozone GDP SA (YoY) (3Q F)

1.6%

1.6%

Medium

10:00

EUR

Eurozone Gross Fix Cap (QoQ) (3Q)

0.4%

1.1%

Low

10:00

EUR

Eurozone Govt Expend (QoQ) (3Q)

0.4%

0.2%

Low

10:00

EUR

Eurozone Household Cons (QoQ) (3Q)

0.3%

0.2%

Low

Critical Levels

CCY

Supp 3

Supp 2

Supp 1

Pivot Point

Res 1

Res 2

Res 3

EUR/USD

1.0109

1.0399

1.0581

1.0689

1.0871

1.0979

1.1269

GBP/USD

1.2468

1.2585

1.2658

1.2702

1.2775

1.2819

1.2936

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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