Weekly Forex Technical Analysis on 18 to 22 July 2016
Technical Pairs: EURUSD, GBPUSD, AUDUSD & USDJPY
EURUSD drifted over and edged superior as markets tried getting back to natural. Currently the pair chooses a fresh direction? The ECB’s rate decision remains out as the key event of the week but certainly not the only one. The conclusion of the political volatility in the UK cheered also the euro & helped it leads. Inflation figures came out as predicted in the euro-zone & we still do not have a settlement to the controversy in Italian banks. In the US, retail sales looks better & other numbers were good enough, but political actions captured the headlines.
The euro-zone troubles are as long as from around & the ECB does not want a superior exchange rate. Although no new measures are on the slot, a cloudy post-Brexit, Draghi might hit the euro, as well as the PMIs. EURUSD remains Bearish.
GBPUSD bounces back solid last week as the pair mounted 230 points. The pair closed at the level of 1.3175. There are a number of significant events this week for GBPUSD, highlighted by CPI & Employment Change. The pound gets a huge boost previous week, courtesy of the BoE, which amazed the markets & did not less interest rates. In the US, retail sales looks better, but an inflation level stands less & consumer belief slipped.
GBPUSD unlocked the week at the level of 1.2941 & suddenly touched a low of 1.2849 levels, as support held at 1.2840 levels. The pair after that twisted the directions & mounted to a high of 1.3480 late in the week. Anyhow GBPUSD pair was helpless to consolidate at these levels & blocked the week at 1.3175 levels. The BoE set fitting in July, but there’s no way getting over the Brexit impact to the British currency, so the central bank will require taking some action immediately. The markets place is currently expecting a rate cut in August. US figures have been strong although a rate rise is unlikely in Q3. GBPUSD remains Bearish.
AUDUSD pair clogged the week almost unmoved. This week’s key event is the RBA Monetary Minutes. Australian business confidence figures jumped, but consumer confidence figure soaked. Employment data was tepid, as Employment Change missed anticipations & the unemployment rate was raised. AUDUSD pair unlocked the week at 0.7557 levels & rapidly touched a low of 0.7521 levels. The pair suddenly reversed the directions & mounted to 0.7667 levels, as resistance held firm at 0.7692 levels. After that retracted & cloaked at 0.7570 levels.
In the US, monetary policy is not anticipated to be hawkish & a rate raise seems doubtful. The markets place will have to deal with the fresh Brexit reality, & continuing volatility in the markets might weigh on the Aussie. AUDUSD stays Neutral.
USDJPY appreciate an outstanding week, growing almost 400 points. The pair blocked at 104.63 levels. It’s a very silent week, with only 2 events on the calendar. The yen declined early in the week, as a landslide victory for Prime Minister Abe’s coalition bricked the path for additional easing measures, which makes the yen low attractive. Retail sales in the US, shows some strength, but inflation levels stays low & consumer belief slipped.
USDJPY pair unlocked the week at 100.69 levels & suddenly reached a low of 100.55 levels. The pair after that posted big gains & mounted to 106.31 levels, testing the support at 106.25 levels. The pair blocked the week at 105.54 levels. The yen was banged previous week on expectations of additional easing in Japan, &d Prime Minister Abe is unavailable at work and will likely unveil one more Abenomics financial package. The yen might regain some lost floor if Brexit matters heat up & drive investors to the safe-haven yen. USDJPY remains Bullish Scenario.
The New Zealand dollar sustained enjoying a strengthen market mood but fairly reversed course & slid back down. Milk prices & GDP only stands out. The good political prospects for the UK accompanied markets recover & the kiwi took leads of this. But later, with good US data & some profit taking, the pair fell.
NZDUSD pair sustained moving higher, but struggled with 0.7290 levels. It fairly fell to lower ground. We start from superior ground this moment. The round figure of 0.74 levels served as resistance & support back in 2015. 0.7305 levels is the high of 2016 yet. 0.7290 was the pre-Brexit high & serves as peak resistance. The next level is 0.7240 which beat the pair in July 2016. The position in New Zealand still looks positive & following the necessary alteration, the rise might resume. NZDUSD remains Bullish.