The US dollar index gained momentum despite weak US data. The New York Federal Reserve's Empire State declined 29.2 points to 43.7, the lowest level since May 2020. It hit a high of 103.44 and is currently trading around 103.42.
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 4% due to geo-political tension. The US 10 and 2-year spread narrowed to -17.6% from -51.90%.
Major resistance- 103.50/105
Major support- 102/101.60.
EURUSD-
EURUSD trades weak despite upbeat German data. German ZEW economic sentiment surged to 15.20 in Jan, compared to a forecast of 12. Major eurozone economic indicators - Euro Final CPI y/y.
Major resistance-1.090,1.0965
Major support- 1.0860,1.0800
Yen-
The pair trades higher due to policy divergence between the US Fed and BOJ. Any close above 148 confirms further bullishness.
Major Resistance- 148,150
Major support- 146.50,144.
Canadian Dollar
The Canadian dollar lost its shine despite strong CPI data. Canada's CPI jumped to 3.4% on a year-over-year basis in Dec, up from 3.1%.
Major Resistance- 1.350,1.3570
Major support- 1.3480, 1.3435


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