EURUSD

 

EURUSD had a poor week, falling to a Seven month low among the ECB meeting. It will sustain lower. A mix of PMIs, inflation data and yet one more speech from Draghi remains out. Draghi left us speculation regarding the next move of the ECB, but that will come this year-end. The euro initially ran higher when he said that extending QE was not considered, but cut down sharply once we know they did not confer anything. The combination of low inflation confirmed this week, downside risks and flimsy growth dampens the image and the euro touched seven-month lows. In the US, the dollar took a breather following the earlier gains but resumed the upside trend also enjoying the good forecast of existing home sales.

 

Monetary policy divergence is a show and will likely constant. The pair traded in a narrow range for so far. When it finally adopts a direction, to the downside, this trend might last. Draghi might use his public appearance to hit the euro when it’s down. EURUSD remains Bearish this week.

 

GBPUSD

 

GBPUSD recorded modest gains earlier week, as the pair finished slightly over the 1.22 level. This week’s key event is Preliminary GDP. In the US, unemployment claims shocked by missing expectations for the 1st time in ten weeks. Construction data was blended while manufacturing figures were stronger than forecast. British job figures were solid, as Average Earnings Index stands steady and Climate Changes take out the expectations. 

 

The pair unlocked the week at 1.2176 levels and rapidly reached a low of 1.2132 levels, as support held at the level of 1.2130. The pair suddenly reversed their directions and mounted to a high of 1.2332 levels. GBPUSD retracted somewhat & ended the week at 1.2216 levels. With the UK government signaling it is preparing to invoke Article 50 and formally departs the EU, Brexit jitters will likely damage, despite decent UK figures. The BoE is expected to lower rates this November, although a Fed rate hike is priced in at 70 percent. So, monetary divergence sustains to favor the US dollar. GBPUSD outlook was Bearish.

 

AUDUSD

 

AUDUSD was unmoved last week, as the pair ended at the 0.76 levels. This week’s highlight is CPI. In the US, unemployment claims shocked by missing expectations for the 1st time in ten weeks. Construction data was blended while manufacturing figures were stronger than a forecast. In AUD, the economy shed 9.8 percent thousand jobs, much worse than a forecast. 

 

The pair unlocked the week at 0.7595 levels and quickly reached a low of 0.7580 levels. The pair mounted to a high of 0.7735 levels, testing resistance levels at 0.7691. After that, the pair twisted directions late in the week and fell sharply, finishing the week at 0.7600 levels. The US economy stays solid and sentiment towards to US dollar stands positive, with a December Fed hike priced at around 70 percent. AUDUSD remains Bearish this week.

USDJPY

 

USDJPY recorded tiny losses previous week, as the pair ended at 103.70 levels. This week’s significant news is Tokyo CPI. In the US, unemployment claims shocked by missing expectations for the 1st time in ten weeks. Construction data was blended while manufacturing figures were stronger than a forecast. There were no major releases out of Japan previous week.

 

The pair unlocked the week at 104.04 levels and suddenly touched a high of 104.37 levels. After that, the pair moved downwards and fell to a low of 103.16 levels, as support held at 102.74 levels. The pair ended the week at 103.69 levels. The BoJ has been reluctant to take additional monetary easing measures, which might advance to the yen gaining floor. At the mean time, a December rate hike has been priced in at 70 percent, so the dollar stays to benefit from anticipations of a rate hike. USD/JPY this week’s scenario was Neutral.