Summary:

  • European stocks give up early gains ahead of Powell’s testimony

  • Iran is about to follow into Venezuela’s footsteps and launch its own cryptocurrency

  • A pack of data from the US to be released in the afternoon

Tuesday looks exceptionally interesting for the USD traders as we will not only get a pack of data from the US economy but also new Fed chair Jerome Powell is going to testify to Congress. Trading was quite steady in the morning as investors’ await this market mover event on the edge of their seats. As the uncertainty surrounds the event CHF advances being the best currency in the group of 10. On the other hand, Swedish krone underperforms against its major peers. Gold trades at a little discount while oil posts minor decline.

Following disappointing PMIs, German IFO and ZEW today’s set of soft indicators coming from the European Commission should not be surprising too much. The overall economic sentiment declined from upwardly revised 114.9 to 114.1 in February. The slowdown was sparked solely by deteriorated industrial sentiment as the index slipped from 9 to 8 while moods in services even grew from 16.8 to 17.5 beating market expectations.

The recovery seen in US stocks since the panic-selling at the start of the month continued yesterday with the US500 hitting a 3-week high. The market rose to make a high of 2787 and in doing so traded back above the levels seen on Monday the 5th February – the day that saw the large declines.

Looking at a daily time frame of the Bitcoin chart one may suspect the cryptocurrency could have already taken a major step toward an uptrend resumption. Namely, the price completed a morning star pattern on Monday which tends to herald gains going forward.

The European Union is expected to publish 100-page Brexit draft on Wednesday concerning details of the Britain’s departure from the bloc and the terms on which the transition period is going to be held. The document may be an attempt to impose a part of the EU vision as it is said to be ignoring some of the UK demands.

Early trading on Tuesday is bringing slight weakness of the New Zealand dollar in the aftermath of the disappointing trade data for January. At the same time, moves across the remaining major currencies are subdued with the greenback being traded slightly below its flat line.

Tuesday has been awaited by the investors as Jerome Powell is about to make his first major appearance as the head of the Federal Reserve. Markets will weigh his testimony trying to assess whether new president will continue Yellen’s policy or turn to be market shaker.