The week was a rather lacklustre one.
Dollar was in for a rude shock as Trump's tax proposal will confront a tough test in the Senate and could even be deferred till 2019. Senators have given thumbs down to the one-time excise duty on offshore payments and have opposed the number of tax slabs proposed by President Trump.
With the exception of a huge plunge in gold contracts that made gold fall $10/oz. to 1276 on Friday, Gold had a calm trading week. Attention was largely on Trump's Asian tour where he adopted a non-aggressive stance with regards to North Korea and China.
EURUSD staged a recovery to end the week at 1.1665, backed by comments from a ECB member that the central bank doesn't plan to hike or extend QE. Strong reading continued to flow from Germany the largest European economy supporting Euro.
GBPUSD too bounced back after a very dovish rate hike by BoE during the previous week. GBUSD managed to stick to 1.3060 and trade up to finish the week at 1.3191. In news from UK, manufacturing production and trade balance showed development while on the Brexit front UK PM May showed inclination to pay the amount EU was asking for.
USDJPY bulls floundered in the struggle to regain 115.00 as 114.50 proved too high a resistance to breach. USDJPY ended the week at 113.56.
The Canadian dollar consolidated as economic figures released last week showed the economy gaining strength. USDCAD ended the week at 1.2682 down 80 pips for the week and somewhat below the critical support at 1.2720.
If last week was dull due to lack of economic data releases, this week is all set to compensate for it with several crucial economic data releases from Europe, UK, US and Canada.
Gold will watch out for any developments Trump makes with tax reforms, whose future looks uncertain as the Senate is set to upset his plans at least till 2019. US inflation figures on Wednesday too would be decisive. Inflation figures may surprise the market on the dollar-negative side as a Dec rate hike is already priced in, in that situation it will be significant only if the inflation figures show a miss reducing the likelihood of a hike and pressurising the US dollar.
Gold has been steady between 1285 and 1270 for many weeks in a row and the coming week might be the one that helps Gold do a breakout.
EURUSD faces numerous resistances above at 1.1690 and 1.1740. And in that situation this Thursday's European CPI figures would be keenly watched. Support for EURUSD can be expected at 1.1610 and 1.1580.
GBPUSD has a multitude of vital data coming out this week starting with CPI figures on Tuesday. Again, not-to-be-missed is Wednesday's jobs data and Thursday's retail sales figures. GBPUSD has made strong base at 1.3060 and has resistance at 1.3210 and 1.3280.
USDJPY has given a bearish ending on Friday and that brings the support at 113.00-112.80 into attention. No important data apart from Wednesday's GDP figure is likely from Japan and therefore the highlight for the week would be US yields and Trump's tax reforms progress.
USDCAD too like USDJPY has given a bearish ending on the charts. 1.2780 would be key resistance for USDCAD, and ability to trade above this would bring 1.2460 into attention. Friday once more would be an important day for CAD as CPI figures come out.