Global stocks rallied yesterday as the market reacted to the latest news on Covid vaccine. In a statement yesterday, Moderna said that its vaccine was 94% effective in preliminary tests. That was a better result compared to Pfizer and BioNTech’s vaccines announced last week. Traders now believe that vaccine shots will start being administered in the next few months, which will be a positive thing for the economy. The new developments come at a time when the number of cases in most countries like the United States and Germany is getting out of hand. In the US, the Dow Jones added 470 points while the S&P 500 added 45 points.
The Australian dollar rose against the US dollar after the Reserve Bank of Australia (RBA) released the latest monetary policy minutes. In the meeting, held earlier this month, the bank lowered interest rates by 0.15% and pledged to offer more stimulus to the economy. Most importantly, the bank said that it was not sensible to take rates negative. Also, the bank emphasised that more fiscal and monetary stimulus was needed as it pledged not to raise interest rates in the next few years.
The economic calendar will have some key events today. In the afternoon session, the US statistics bureau will release the October retail sales. Analysts expect the data to show that sales rose by just 0.5% on a monthly basis. They also see the core retail sales rising by 0.6% after rising by 1.5% the previous month. Other numbers out later are the export and import price index, capacity utilisation, and Redbook. In Europe, we will receive the GDP data from Norway and construction output from the Eurozone. In Canada, the statistics bureau will release wholesale sales and foreign security purchases.
EUR/USD
The EUR/USD pair rose to an intraday high of 1.1867, which is an important resistance being the highest level in September and October. The recent rally is supported by the 15-day and 28-day exponential moving averages while the two lines of the stochastic oscillator are rising. It is also being supported by the ascending trendline that is shown in white. Therefore, if the price manages to break the current resistance level, it will signal more upside, with the next target being at 1.1900.
GBP/USD
The GBP/USD pair rose to an intraday high of 1.3220 ahead of the next round of Brexit talks. On the hourly chart, the price has managed to move above the important support of 1.3107, which was the lowest level last week. It is also at the higher side of the Bollinger band while the awesome oscillator is above the neutral line. Also, the price is being supported by the ascending trendline that is shown in white. Therefore, the pair will likely continue rising as bulls aim for the next resistance level at 1.3300.
AUD/USD
The AUD/USD pair rose to an intraday high of 0.7321. On the four-hour chart, the price is slightly below last week’s high of 0.7340. The price is above the 61.8% retracement and slightly above last week’s low of 0.6220. It is also above the 25-day moving average. Therefore, the pair will likely continue rising if bulls are able to move above the next resistance at 0.7345.
