Powell Nominated to Stay Fed Chair, Flash PMIs and RBNZ Decision Take Center Stage

USD Gains and Equities Pull Back as US Pr. Biden Picks Powell

The US dollar traded higher against all the other major currencies on Monday and during the Asian session Tuesday. It gained the most versus NZD, JPY, and CAD in that order, while it eked out the least gains versus CHF.

Nasdaq 100 — Technical Outlook

The Nasdaq 100 cash index fell sharply yesterday, after hitting a fresh record high, at around 16760. That said, the index is still trading above the 16300 zone, and the upside support line drawn from the low of October 13th. We would like to see a dip below that crossroads before we abandon the bullish case. For now, we would still examine the case of a potential rebound from that line.

Flash PMIs to Provide an Updated Picture on Major Economies

As for today, the main items on the agenda may be the preliminary PMIs for November from the Eurozone, the UK, and the US.

EUR/USD — Technical Outlook

EUR/USD continued sliding yesterday, falling below Friday’s low of 1.1250. Overall, the pair continues to trade below the downside resistance line drawn from the high of May 25th, but since November 9th, it’s been respecting a new steeper line, which paints an even more negative picture.

RBNZ Set to Hike, but by How Much?

Tonight, during the early Asian morning, we have a central bank deciding on interest rates and this is the RBNZ. Back in October, this Bank raised interest rates by 25bps as was widely expected, noting that further removal of monetary policy stimulus is expected over time. With the New Zealand CPI surging to 4.9% in Q3, and the unemployment rate hitting a record low during the same quarter, market participants are almost certain that officials will hit the hike button again this week. The main question though is whether they will add 25 or 50bps. According to market chatter, there is around a 40% chance for a “double hike”.

As for the Rest of Today’s Events

Besides the PMIs, the only other release worth mentioning is the API report on crude oil inventories for last week, but as it is always the case, no forecast is available.

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