What drives the market on July 8?
The market takes breath after the long rally. What opportunities do traders have today?
Daily News: markets are up
- The US dollar index is rising. Yesterday it tested the psychological level at $95, however, couldn’t stick above it. Up to now, the index has been trading near $94.90. No important economic data will be released today, as a result, there are risks that the index won’t be able to break the psychological level again. The support lies at $94.50.
- Yesterday the single currency fell because of the negative news from the German government. Germany’s interior minister and leader of the Christian Social Union (CSU) Horst Seehofer was going to resign because of the conflict with Angela Merkel over the migration issue. However, positive news on a compromise between parties became a driver for the euro today. Mr. Seehofer will keep his positions.
As a result, EUR/USD rebounded from the support at 1.1645. If the USD is weak today, the pair will have chances to reach the resistance at 1.1665. However, the trading isn’t extensive, moreover, there won’t be any important economic data today. As a result, there are risks of the fall. The support lies at 1.1565.
- The pound managed to rebound as well. There is some news on the Brexit deal. The Prime Minister will present the third Brexit customs model at Chequers meeting on Friday. No details about the model now. Let’s wait until Friday. As the EU said, “the UK is short in time”. So, the UK, hurry up!
The GBP/USD pair is moving to the resistance at 1.3180 (the pivot point). The downward trend line is weighing on the pair as well. Today traders will take into consideration construction PMI data. The forecast is encouraging. If the actual data is greater than the forecast one, the pair will have chances to break the resistance. Otherwise, there are risks of the reversal. The support is at 1.3070.
- USD/JPY pair is moving up. According to the Japanese press, the BOJ will cut its inflation forecast this month (the meeting is on July 30-31). As a result, the loose monetary policy is anticipated to continue for much longer. USD//JPY tested the resistance at 110.90. Up to now, the pair has been moving to the next one at 111.40. If the USD is strong today, the pair will be able to reach the resistance. Otherwise, the pair will stay near 110.90.
- Early in the morning, the Reserve Bank of Australia held the meeting. As anticipated, it kept the interest rate unchanged (for a record 21 straight meeting, the last change happened in August 2016). Moreover, the Central Bank’s statement was neutral and without significant changes comparing to the previous one.
As a result, the Australian dollar didn’t react to the meeting a lot. AUD/USD managed to reverse. Up to now, the pair has been moving up. However, the trendline will be a resistance for the pair. Moreover, on H4, 50-hour MA (0.7382) is putting pressure on the pair. No important economic data will be released today. As a result, there are risks that the pair won’t be able to break above the trendline. The support lies at 0.7320.
That’s all for today! Follow market news with FBS!
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