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The British pound continues to trade towards the 1.3268 level against the U.S dollar, ahead of the UK Autumn Budget. Price-action is currently range-trading between the 1.3220 and 1.3368 levels. With GBPUSD traders awaiting British Chancellor of the Exchequer, Phillip Hammond, to lay out his post-Brexit vision for the UK economy. Later today, we also see a raft of high-impact U.S macro-economic data, with the FOMC Meeting Minutes headlining.

The GBPUSD pair is intraday bullish while trading above the key 1.3220 technical level. Further upside towards the 1.3280 and 1.3307 resistance levels seems likely.

Any loss of the 1.3220 level should lead to a further sell-off in the GBPUSD pair towards the 1.3200 and 1.3168 support regions.

The euro has found strong dip-buying demand from the 1.1713 technical level against the U.S dollar, despite on-going political uncertain inside Germany. The EURUSD pair currently trades above the 1.1740 level, during a quiet Asian trading session. The macro-economic calendar is extremely busy going into today's pre-Thanksgiving U.S trading session. Traders will look to the release of the CORE Durable Goods Orders and monetary policy guidance from the FED, when they release the FOMC Meeting Minutes.

The EURUSD pair is now intraday bullish while trading above the key 1.1713 level. Further upside towards the 1.1807 and 1.1860 remains possible if euros buyers push price above the 1.1755 level.

Any loss of the 1.1713 zone will likely lead to a further weakening of the EURUSD pair back towards the 1.1683 and 1.1640 technical zones.

Today sees the release of the UK's Autumn Budget with the markets believing this financial statement is critical for Prime Minister Theresa Mays' survival. Following the very narrow victory she had in the recent General Election, this Budget could provide May with an opportunity for redemption from voters. The Prime Minister is treading water as she deals with conflicts within her own cabinet and talks of a rebellion within her own party to oust her. However, whilst Prime Minister May is under pressure from all sides, it appears that the Brexit negotiation process is moving forward with many close to the process stating that a Brexit divorce deal is likely within three weeks. Further information has stated that negotiators have penciled in the week of December 4 as a breakthrough moment for the two sides.

On Tuesday, Federal Reserve Chair Janet Yellen stated that the central bank is “reasonably close” to its goals and should keep gradually raising US interest rates to avoid the dual pitfalls of letting inflation drift below target for too long and driving unemployment down too far. Such comments would normally result in USD strengthening but had little effect on the greenback. Later today may provide more information as the Fed will release the minutes of the Oct. 31-Nov. 1 FOMC meeting minutes, which the markets will be evaluating for any new indications that an interest rate hike is likely in December.

Ongoing political developments in Germany are being closely watched by the markets, whilst many believe that German economic growth will not be impacted by the collapse in coalition talks between German Chancellor Angela Merkel and potential partners. Merkel has stated that she would prefer new elections if she can't put together a majority to lead the nation. EUR hit a 4-week low overnight before retracing higher, as the markets appear to be focusing on the Eurozone's healthy economy and not Germany's political instabilities.

EURUSD is 0.15% higher in early Tuesday trading at around 1.1755.

USDJPY is 0.32% lower in early session trading at around 112.06.

GBPUSD is little changed overnight, trading around 1.3247.

Gold is 0.2% higher, trading around $1,283.

WTI is 1.3% higher, trading around $57.88.

Major data releases for today:

At 12:30 GMT, Her Majesty's Treasury will release the Autumn Financial Statement. The statement is given by UK Chancellor Hammond and focuses on the current state of the UK economy. Often referred to as the Autumn Budget, which details future tax and spending plans for the UK. There is a possibility that the statement could result in volatility in GBP.

At 13:30 GMT, the US Department of Labour will release Initial Jobless Claims for the week ended November 17th & Continuing Jobless Claims for the week ended November 10th. Initial Claims are forecast to have fallen to 240K from the previous release of 249K, with Continuing claims rising slightly from 1.860M to 1.882M. If the actual release is significantly different from expectations we will see USD volatility.

At 13:30, the US Census Bureau will release Durable Goods Orders and Durable Goods Order excluding transportation for October. Durable goods are forecast at 0.3% from the healthy previous reading of 2.0%, with the data excluding transportation expected at 0.5% from the previous 0.7%. US industrial productivity has been healthy for some time so a poor reading is likely to see USD come under pressure. Conversely, a higher reading will see USD strengthen.

At 15:30 GMT, the US Energy Administration will release Crude Oil Stocks change for the week ended November 17th. The forecast is calling for a drawdown of -2.167M compared to the previous increase of 1.854M. As always, regardless of the actual release, the markets will experience volatility in both WTI and Brent prices.

At 19:00 GMT, the Federal Open Market Committee will release the minutes from their previous meeting. The markets are keen to analyze the tone of the content to determine future US economic policy.

The dollar was on the backfoot in Asia on Wednesday as the US yield curve flattened to its lowest spread in a decade, while dovish comments from the Fed chief late on Tuesday dragged the currency even lower ahead of the Fed meeting minutes. Energy markets also posted significant moves during the session, with oil prices heading towards two-year high levels.

The difference between the 2-year and 10-year US Treasury yields touched the lowest since November 2007 on Tuesday, spreading fears of a possible economic downturn. This occurred as investors expect the Fed to continue to raise short-term interest rates, while they remained pessimistic about the future economic outlook, driving long-term yields lower. The dollar index which gauges the dollar's strength against six major currencies retreated by 0.14% on the day to 93.81. Dollar/yen lost the most, falling by 0.30% to 112.07. The dollar-denominated gold was trading 0.22% higher at $1,283.50 per ounce.

Remarks by the Fed chair Janet Yellen late on Tuesday, who gave a speech at the NYU Stern School of Business in New York, failed to support the greenback. Yellen said that the Fed projects inflation to rebound next year but policymakers still have doubts on whether inflationary drivers will prove long-lasting.

Next on the day, the focus will turn to the Fed meeting minutes due at 1900GMT as investors will be eager to identify any indications on the path of interest rates. Data on the US durable goods orders will also gather some attention later today.

The euro climbed slowly by 0.17% to $1.1758 as markets were less concerned that political noise in Germany would harm the Eurozone's relative economic performance. Meanwhile, in Germany, a poll conducted by INSA for the Bild daily showed that almost half of Germans favored new elections after coalition talks collapsed on Sunday. Moreover, the results indicated that Germans prefer the left-center SDP to rule the country together with Merkel's CDU party. Note that the former shared the country's leadership with Merkel's Conservatives during the past four years, but the Socialists lost a lot of support in September's elections.

In the UK, the Finance Minister, Philip Hammond, will deliver his Budget Statement to the British Parliament around 1230GMT. Hammond is expected to give a brief on the country's current economic conditions, future projections and the health of the public finances. Most importantly, traders will look forward to hearing whether Hammond will downgrade the country's growth outlook for the next four years. This could restrict the amount Britain wants to put aside to mitigate Brexit risks. The pound was mainly flat during Asian trading hours at $1.3247. Euro/pound was up 0.15% at 0.8879.

Turning to energy markets, oil prices were on track to hit two-year high levels after the API weekly report surprisingly showed on Tuesday that US crude oil inventories fell by the most in three weeks. US crude stocks fell by 6.356 million barrels, while analysts forecasted a decline of 1.500 million barrels. This drove WTI crude up by 1.85% to $57.88 per barrel and pushed Brent 1.02% higher to $63.21. Consequently, the oil-linked loonie surged by 0.21%, leading dollar/loonie down to 1.2752.

EUR/USD

Current level - 1.1742

I still favor a short-lived dip to 1.1690 before reversal and climb towards 1.1870 hurdle.

USD/JPY

Current level - 112.15

The recent positive momentum has been lost and the bias is bearish, for another slide to 111.60.

GBP/USD

Current level - 1.3253

The bias remains positive above 1.3220, for a rise towards 1.3340 area. Crucial on the downside is 1.3170.

Hammond Needs to impress investors
Merkel; Another attempt for grand coalition
FOMC minutes may provide clue for December rate hike

European markets are showing some solid gains thanks to fresh all-time highs on Wall Street which is fuelled by more enthusiastic outlook for tax reform and stellar earnings

When it comes to sterling, it is all about the upcoming budget, and what Chancellor Philip Hammond could do to motivate the investors. He is in a very tight position; given all the drama which has been taken place. The Chancellor would have to bring the rabbit out of the hand to escape this one. Abolishing or reducing the stamp duty is going to do no wonders for him, he needs to increase the spending and also strike a balance with austerity to up his game.

The dollar index is still struggling to make gains in against major currencies, Having said that, the upcoming FOMC Minutes would be something which traders should pay attention too, better the devil you know (than the devil you don’t). During their last meeting, the Fed left investors scratching their head about their decisions on hiking the interest rate one more time. The fed reasoned that the labour market would strengthen further.

While the job market has not shown any considerable sign of weakness, we do believe that traders are widely expecting that the fed will increase the interest rate coming this December. The upcoming November FOMC minutes would provide further clues for this puzzle. However, if the fed is hesitant that would give a clear message to traders that they should start shaving off their profits from their trades, going into this upcoming long weekend.

It has been a dull session for the Euro, as the German Chancellor Angela Merkel prefers a new election rather than having a minority government. Ostensively, she is confident that she has the support of the public. As an investor, you do not want to see this uncertainty becoming prolonged. But the real question is if Merkel views it the same.

Investors are always keeping their focus towards the ECB’s stance on its Monetary policy. The EUR/USD pair would need some hawkish views from the ECB’s in order to break the resistance of 1.20. For now, it appears that the pair is doing nothing but consolidating.

The Euro moved higher on Wednesday, on track to complete Morning Doji Star reversal pattern and signal further recovery. Fresh bullish extension from correction low at 1.1712 penetrated hourly cloud (spanned between 1.1752 and 1.1771), eyeing 55SMA barrier at 1.1782, regain of which would open way for renewed attack at daily cloud (cloud base lies at 1.1812). Rising 10SMA which contained pullback from 1.1859 high continues to track the advance and marks initial support at 1.1734 (also session low). Daily techs are in bullish setup and gaining momentum for further upside. No releases from the Eurozone scheduled today with focus turning towards techs and a batch of data from the US, which are going to be released today, as the US will be shut on Thursday for Thanksgiving holiday.

Res: 1.1782, 1.1812, 1.1859, 1.1877
Sup: 1.1752, 1.1734, 1.1712, 1.1679

XAUUSD (1280.61): Gold prices continue to consolidate with the attempt to retest the 1285 resistance level failing. Gold prices remain caught within the range of 1285 and 1274 levels as a result. In the near term, this consolidation is likely to emerge into a breakout. With the bias balanced, the breakout could be in any direction. To the upside, above 1285 resistance, gold prices could be seen pushing higher, targeting 1304 resistance. To the downside, a break down below 1274 will signal a continuation towards the 1262 handle.

USDJPY (112.17): The USDJPY was seen giving up the gains following the minor bounce on Monday. Price action is likely to retest the previous lows which was formed near the support level of 112.04 - 111.74 region. A rebound off this support level will see some upside in USDJPY but the currency pair remains flat. Resistance level at 113.00 remains the main obstacle to the upside which is unlikely to be breached. In the short term, USDJPY could be seen trading flat but the bias to the downside remains strong. A break out below 112.04 - 111.74 could signal further declines down to the 110.74 level of support.

EURUSD (1.1740): The EURUSD closed with a spinning bottom candlestick pattern yesterday. This comes just a few pips above the support level at 1.1700. Price action remains biased to the upside, despite the declines in the past few days. In the near term, we can expect EURUSD to touch down to the support level at 1.1700. This will potentially see the common currency attempting to bounce off this level. To the upside, the previous resistance formed at 1.1843 - 1.1822 is likely to be tested once again. A breakout from this resistance or support level will determine the next leg of direction in the EURUSD.