Probably is that the US and China resume negotiations

“Delegation will be sent to the US for talks in late August” and “The delegation will be led by Vice commerce minister and meet US team led by Secretary of the Treasury” – its stated in a statement of China’s ministry of commerce. Also, we could see the USD weakening somewhat temporarily.

In other news we could get the UKs Retail Sales growth rates (European morning) and the number of housing starts and the Philly Fed manufacturing index (American session).

AUD/USD broke the downward trend line and tested the 0.7265 (Asian session). We see the case for the pair to start slowly rising as the USD could weaken. We could see the pair breaking the 0.7265 resistance line and aim for the 0.7325 resistance area. On the other side, we could see the pair aiming if not breaking the 0.7200 support line.

UK to secure transition deal with EU this week

Media suggest that the UK and EU Brexit negotiators are to restart negotiations and have a press conference today. The main issue will be the Brexit transition period and the UK will try and secure the transition deal at the EU summit later this week. On other headlines, a committee of lawmakers stated that the UK should consider a limited extension for it’s exit from the EU. Any positive headlines about the securing of the transition period could strengthen the sterling.

Cable traded in a sideways manner on Friday testing the 1.3915 support line. We see the case for the pair to continue to trade in a sideways manner with some bullish tones should there be positive headlines for the sterling. Should the pair come under selling interest we could see it breaking the 1.3915 support line and aim for the 1.3775 support barrier. On the other hand should the pair find fresh buying orders along its path we could see it breaking the 1.4040 resistance level.

Negotiations to start in Korean peninsula

Negotiations are about to start in the Korean peninsula in an effort to smoothen out relationships between South and North Korea. Yesterday the North Korean Leader declared his willingness to discuss a possible activation of a border hotline between the two countries, a proposal that followed New Year’s statement about a possible attendance of February’s Winter Olympics by a North Korean delegation. The whole issue and negotiation’s possible progress could be overshadowed though by a US negative stand. Some analysts suggest though that once negotiations start on the 9th of January, any disorder in US- South Korean relationship should smoothen out. However given president Trump’s unpredictability and the fact that the US foreign policy has sticked to the N. Korea-power-of-evil story for so long, it could prove hard to for the US to welcome the negotiations.