The US dollar index gained momentum despite weak US PPI data. US PPI fell 0.10% in Dec, compared to a forecast of 0.10%. Core PPI came unchanged at 0% vs the forecast of 0.20%. It hit a high of 102.93 and is currently trading around 102.905.
According to the CME Fed watch tool, the probability of a no-rate cut in Jan increased to 95.3% from 94.80% a week ago.
The US 10-year yield 'gained more than 2% on strong CPI data. The US 10 and 2-year spread narrowed to -20% from -51.90%.
Major resistance- 103/104
Major support- 102/101.60.
EURUSD-
EURUSD pared some of its gains due to Middle East Geo political tension. Hawkish comments from ECB's Holzmann and Nagel will prevent the Euro from further sell-off. Major eurozone economic indicators - German ZEW economic sentiment and German CPI.
Major resistance-1.1100,1.1070
Major support- 1.0880,1.0800
Yen-
The pair trades higher for the second consecutive day on board-based US dollar buying. Any close above 146.50 confirms further bullishness.
Major Resistance- 146.50,148
Major support- 144,143
Canadian Dollar
The Canadian dollar lost its shine despite strong manufacturing and sales. Canadian manufacturing sales gained 1.2% in Nov vs. Forecast 1.1%.
Major Resistance- 1.350,1.3570
Major support- 1.3400, 1.3340


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