EUR/USD. January 19, 2021 – The pair is awaiting Biden's inauguration
On Tuesday, the major currency pair started recovering from the 1.2050 area. The current quote EUR/USD is 1.2135.
Today the macroeconomic calendar is empty, but market participants have something to think over. For example, the results of the Reuters poll showed that the new stimulus package from the ECB is unlikely to have a positive impact on the European economy. In particular, we are talking about the already agreed PEPP package of 185 trillion euros, which was extended for another 9 months. Against the backdrop of such pessimistic opinions, the economic outlook for the eurozone looks rather bleak.
As for the United States, not everything is smooth here either. Former head of the Federal Reserve System Janet Yellen said that the US economy could find itself in a long and rather severe recession if Congress does not agree on additional support measures. Today, attention should be paid to Yellen's speech, which, as expected, Joe Biden intends to appoint the new head of the Federal Reserve System.
The inauguration of the new US President-elect Joe Biden will take place tomorrow. Market participants are waiting for this event, so the dynamics of trading today will not differ in activity.January 19, 2021. Fundamental analysis of the oil market
The oil market, which has been growing steadily since the beginning of November last year (when the first news of successful trials of coronavirus vaccines appeared), is gradually losing its impetus. Having managed to rise from the $40 per barrel area to $57 from October to January, today oil is traded near the $55 per barrel level.
The January 2021 high at $57.5 was reached after Saudi Arabia unexpectedly announced its decision to unilaterally cut oil production in February and March (by 1 million barrels per day). Then the pandemic and its consequences on transportation and fuel demand again began to put pressure on quotations.
At the same time, some support for the prices of «black gold» is provided by the approval of Joe Biden as the new US president. Market participants expect that its measures to support the economy will raise inflation, which has increased the demand for oil from speculators and investors.
Taking into account the current fundamental background, it can be concluded that oil prices are unlikely to grow significantly in the near future. We believe that the range of fluctuations in Brent quotes will be represented by a corridor of $50-55 per barrel.
Today prices are rising slightly from the $55 level in anticipation of a report from the International Energy Agency (IEA). The experts of the organization intend to share their forecasts for the further dynamics of the market, taking into account the new lockdowns in many countries.
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