What will happen? The US Q2 Gross Domestic Product will be announced at 15:30 MT time (GMT+3) on Thursday, July 29…
Daily News: a big day for Central Banks
- A day will be full of speeches of central banks’ Kings! Mr. Lowe, the Governor of the Reserve Bank of Australia, Mr. Draghi, the President of the European Central Bank, Mr. Kuroda, the Governor of the Bank of Japan, and Mr. Powell, the Chairman of the Federal Reserve will participate in a panel discussion at the European Central Bank Forum on Central Banking, in Portugal (16:30 MT time). Let’s see what new they are ready to present.
Author of the picture: Alexandros Michailidis / Shutterstock.com
- On Tuesday, the US dollar index managed to close above the psychological level at $95, as a result, it is going up today. Today traders will look at current account (15:30 MT time) and existing home sales (17:00 MT time) data. The forecast is mixed, so if the actual data are greater than anticipated, the index will go higher. Moreover, Mr. Powell will give a speech at 16:30 MT time. If he sounds optimistic, the USD will appreciate more. The resistance is at $95.40.
- Some threats for the Chinese yuan. According to the Wall Street Journal, “If the U.S. goes ahead with tariffs, China would need to consider some of the more aggressive options. Letting the yuan weaken becomes something that logically the Chinese would consider.” Let’s have a look at the chart. USD/CNH is growing since June 14 when Mr. Trump announced additional tariffs on Chines goods. The pair is trading at highs of January 2018. If Mr. Trump imposes new tariffs he announced just yesterday, the pair will move even higher.
- The oil market is trying to recover. Today crude oil inventories data will be released at 17:30 MT time. The forecast is not encouraging for oil as the decline in a number of barrels will be less than last week. However, the data from the private survey of the US Energy Information Administration showed a bigger decline than anticipated. As a result, up to now, Brent and WTI are going up. If the official data shows a greater decline as well, the further rise is anticipated. However, if the decline is less than anticipated or even there is a surplus, both oil benchmarks will go down.
WTI is above the pivot point at $65.25, however, 100-day MA is weighing on it. If data is encouraging for the oil market, WTI will move to the resistance at $66.20. Otherwise, it will go down to $63.30.
Brent is moving up as well. The oil benchmark tested the resistance at $75.70. However, 50-day MA is putting pressure on it. If data is encouraging, Brent will be able to break the resistance, otherwise, it will return to the support at $74.35.
- Oil is rising, as a result, USD/CAD doesn’t have enough strength to rise. The pair couldn’t break the resistance at 1.33. The further movement will depend on the strengthening dollar and oil data. If they are not encouraging for the Canadian dollar, the pair will be able to break the resistance and move further to 1.3380. Otherwise, the pair will turn around and will move to 1.3120.
- No significant changes in directions of other currencies.
That is all for today. Follow markets’ news with us!
Today the Fed will make a policy statement at 21:00 GMT+3. This event will affect all the currency pairs with the USD and thus almost the all Forex market!
The overall market sentiment is risk-on. The S&P 500 index (US 500) is getting close to the all-time high. Oil is recovering quickly from its recent losses.
What events to follow and how to trade during the week of July 2-6?
EUR/USD retraced to 1.1870 after breaking out this level. It should be just a natural sell-off ahead of the further rally up.
The Fed held a much-awaited meeting yesterday. The bank hasn’t made any policy changes. As a result, the USD weakened and EUR/USD rocketed. Jump in to know all the latest news!