US futures declined after Amazon released its quarterly earnings. Its third-quarter profits declined from a year ago as the company increased its investment in growth. In the past few months, the company has accelerated hiring and making investments to speed delivery. Its operating income declined to $3.2 billion from $3.7 billion a year ago. Its total sales rose to more than $70 billion, which was a 24% increase from the same quarter a year ago. In the earnings call, Jeff Bezos defended his investments arguing that it was the right thing to do for the long term. Meanwhile, Intel stock rose sharply in after-hours trading after better-than-expected earnings. EPS came in at $1.42, which was better than the expected $1.24 while revenue of $19.19 billion was better than the expected $18.05 billion.
The Euro was unchanged during the Asian session as traders continued to react to the ECB’s decision. Yesterday, the central bank left interest rates unchanged as was widely expected. In the statement, the bank reiterated that it would restart quantitative easing in November. The bank ended the previous round of QE in December last year. The decision came a few hours after traders received flash manufacturing PMI data for October. These numbers showed that European manufacturing was still in recession. Later today, traders will receive survey data from IFO. The business climate in Germany is expected to decline from 98.5 to 94.5 while the current assessment is expected to drop to 98.0 from 98.5.
Sterling dropped yesterday after Boris Johnson said that he would give members of parliament more time to debate his deal if they agreed on a snap election. If the election is approved, it will take place on December 12. Members will vote for the election on Monday. Labour party and the Scottish National Party have said they will only support an election once a no-deal Brexit has been removed from the table. Johnson believes that his party can secure a majority in the election. This would give him a better mandate to have his deal passed.
EUR/USD
The EUR/USD pair declined from a high of 1.1155 to an intraday low of 1.1093. On the hourly chart, the price is slightly lower than the short and medium-term moving averages. The RSI and the accumulation/distribution indicators have flattened while revenues have tanked. Today, the pair may remain in the current levels as the market receives survey data from Europe and the US.
XAU/USD
XAU/USD pair rose today as the market continued to react to the Fed’s decision to intervene in the Repo market. The pair is trading at 1502, which is close to the highest level since October 10. On the hourly chart, this price is along the 61.8% Fibonacci Retracement level. The price is above 14-day and 28-day moving averages while 14-day RSI is along the overbought level. This pair may continue to rise as the market waits for the Fed rates decision next week.
GBP/USD
The GBP/USD pair was unchanged as Boris Johnson plans for a December election. The pair is trading at 1.2845. This week, it lost the momentum it had a week ago. The pair has remained below last week’s high of 1.3015. Its price is between 100% and 61.8% Fibonacci Retracement level. It is also below the 14-day and 28-day moving averages. 20-day RSI has flattened along the current level of 43. The pair may move lower to test the 61.8% Fibonacci level at 1.2700. Still, this will depend on the extension the EU grants the UK.
