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01 Aug

Forex Weekly Technical Forecasts 1 to 5 August 2016

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Weekly Forex Technical Analysis on 1 to 5 AUGUST 2016
Technical Pairs: EURUSD, GBPUSD, AUDUSD & USDJPY EURUSD
 
EURUSD drifted nearly 1.10 throughout most of the week but was pushed superior on USD weakness. It is breaking out of range. This week features PMIs as well as other numbers. The Brexit complications are not so terrible for Germany according to IFO. GDP became as we expected at 0.3 percent and inflation taken out predictions with +0.2 percent, giving a bit of confidence for the ECB. The EBA force tests did not tell us the thing we did not know. In the US, the Fed was more positive but did not give a hint for a raise. The higher blast for the greenback came from a poor GDP result: only 1.2 percent in comparison to 2.6 percent anticipated. Europe’s banking problems are too long from being solved also inflation stays an issue. Still, the weak GDP data from the US is a cause to pause and think regarding the future of rates. Overall, things might remain balanced. EURUSD stands Neutral Outlook.
 
GBPUSD
 
GBPUSD twisted directions earlier week & gained 100 points. The pair blocked at 1.3122 levels. This week’s major event is the official bank rate, with the BoE forecasts to lower rates to 0.25 percent. Preliminary GDP for second quarter posted a gain of 0.6 percent, edging over the forecasts of 0.5 percent. Despite a respectable growth, this might be the calm before the storm, as experts predicted a weak Q3 due to Bexit. In the US, the Fed was carefully optimistic but did not give any hints about the timing of a rate hike. The greenback lost floor in response to a poor GDP result: a gain of just 1.2 percent, well short of the forecast of 2.6 percent.
 
GBPUSD unlocked the week at 1.3121 levels & reached a low of 1.3053, testing the support levels at 1.3064 mentioned last week. The pair then twisted directions & mounted to a high of 1.3301 late in the week. GBPUSD was weak to consolidate at these levels and backtrack, clogging the week at 1.3222 levels. The BoE is predicted to lower rates this week to 0.25 percent. Even though this drive has been priced in, a rate cut will be a key event and might result in the pound losing floor. GBPUSD stands Bearish Outlook.
 
AUDUSD
 
AUDUSD bounce back last week, gaining 100 points. The pair ended the week at 0.7578. This week’s major news is the RBA interest rate decision and Retail Sales. Australian CPI bounces back with a gain of 0.4 percent, giving the pair a short boost. In the US, the Fed was carefully optimistic but did not give any hints about the timing of a rate raise. The greenback lost floor in response to a result: a gain of just 1.2 percent, well short of the forecast of 2.6 percent.
 
AUDUSD unlocked the week at 0.7473 levels and cut down to a low of 0.7416 levels. The pair after that changed directions and mounted to a high of 0.7610 late in the week, testing the resistance levels at 0.7597 mentioned last week. AUDUSD ended the week at 0.7578 levels. The markets are anticipating rate cut from the RBA. Despite this is priced in, the magnitude of such drive might well force the Aussie lower. In the US, the GDP was depressing, but few positive data will renew speculation regarding a rate hike. AUDUSD stands Bearish Outlook.
 
USDJPY
 
The Japanese yen placed its solid gains since February, as USDJPY descend 430 points. The pair blocked the week just under the 102 level. There are 7 events on this week’s calendar. The yen posted solid gains after the BoJ decision, in which the bank abstained from lowering rates or developing its capital-purchase program. USDJPY lost more floors following the soft GDP result, with the economy bolstering just 1.2 percent, compared to the estimate of 2.6 percent.
 
USDJPY unlocked the week at 105.39 levels & reached a high of 106.72. The pair after that twisted directions & fell down to a low of 101.89 levels, as support held firm at 101.51 levels mentioned last week. The pair finished the week at 101.94 levels. The BoJ has shown still once more it has little monetary ammunition to expanding the struggling economy. At the mean time, the Fed hasn’t given any clues regarding a rate hike, so September might rotate without a rate hike. USDJPY stands Bearish outlook.
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