China’s GDP for the year 2019 grew at a pace of 6.1%, according to data released last Friday. Although the pace of GDP growth remains slow, it was within the GDP target of 6.0% – 6.5% for the year.
Global equity markets maintained the gains from earlier in the week after the data. Despite being the slowest pace of growth in 29 years, investors expect to see it pick up following the Phase One trade deal between Washington and Beijing.
Eurozone Inflation Picks Up in December
The final inflation figures for the eurozone showed consumer prices rising 1.3% annually in December 2019. The core CPI, which excludes food and energy prices, grew by 1.3% as well. The data was in line with the flash estimates and shows a rebound in consumer prices.
EURUSD Slips Down to Support
The euro was down by over 0.40% on Friday. The declines accelerated after a failure to build upon the consolidation near the 1.1131 level of support/resistance.
Price action fell to the 1.1100 level and could dip lower to 1.1072. With the Stochastics now back into the oversold level, there is a slight chance of consolidation within the range.
UK Retail Sales Surprisingly Lower in December
The monthly retail sales report for the United Kingdom saw sales in terms of volume falling 0.6% on the month. This marks the third consecutive month of decline in the data.
Retail sales in November were revised down from 0.6% to 0.8%. The pound sterling fell sharply on the news, losing over 0.5% on the day.
Is GBPUSD Resuming the Downtrend?
The declines in the GBPUSD came right after price tested the 1.3100 level of resistance. With prices being promptly rejected, the pound sterling reversed direction.
There is scope for the downtrend to continue which could see GBPUSD falling back to the 1.2960 level of support.
Gold Chalks Modest Gains
The precious metal was up 0.35% into Friday’s close, reversing the losses from the previous session. Price action in gold remains flat compared to the strong moves made in late December 2019. The consolidation in gold suggests that investors remain unsure of the direction of the precious metal for the moment.
XAUUSD is Forming an Ascending Triangle
After easing back from a seven-year high, gold prices are trading flat with the resistance level at 1562.40. The ascending triangle forming near this level could suggest further upside in gold if the resistance level breaks.
The minimum upside target is seen at 1580 if successful. Otherwise, we expect gold to slip back to test the lower support at 1534.14.