Week ahead June 25th – 29th

EUR/USD

Last week was a good week for EURUSD for bull traders, and as it was widely expected the pair retreated from its lows around 1.1500 up to 1.1672. For this week, we have on Monday, the German IFO business climate pointing lower at 101.7 down from last reading of 102.2. In the US, Chicago Fed National Activity Index is expected to be lower at 0.09 down from last months report of 0.34. On Tuesday, S&P Case-Shiller Home Price Indices are expected higher at 7.1% up from the last report of 6.8%. Later on Tuesday, we have two FED officials speaking as well. On Wednesday, the ECB Non-monetary policy and economic bulletin will be released, and the US durable goods orders are expected higher at 0.2% up from last report of -1.7%. Also, on Wednesday, Pending Home Sales are projected to be 0.1%, up from its last reading of -1.3%. On Thursday, German Harmonized Index of Consumer Prices are expected to remain unchanged. In the US, Annualized Gross Domestic Product is expected to remain unchanged and Core Personal Consumption Expenditures is pointing positive at 2.7% up from the last report of 2.3%. On Friday, European Consumer Price Index is expected at 2% up from last reading of 1.9%, and in the US, University of Michigan sentiment is expected lower at 99.2 down from last measurement of 99.3. Having in mind the above fundamentals, the EURUSD pair may attempt once again to retest its lows on Wednesday, if the US GDP shows positive as expected, however, a new recovery will take place by Friday if the European 2% CPI is confirm.

Technical analysis shows that EURUSD is neutral. As last week’s support of 1.1557 was rejected once again and pair closed above 1.1600 this gives us a more positive view. We maintain both open buy positions, targeting 1.1800 to take profit.

 

GBP/USD

This is what the bulls were waiting for, for so long. A clear signal from the BOE, finally gave the right push to the GBP. For this week, we have BOE’s governor Carney speaking on Wednesday and a financial stability report to be release on the same day. On Friday, GFK Consumer Confidence is expected higher, and UK Gross Domestic Product is pointing higher at 1.3%, up from last reading of 1.2%. The GBPUSD pair may trade lower ahead of the US GDP report, but it’s fundamentally expected to continue trading higher. Brexit negotiations may help recovery to speed up, or to delay recovery accordingly, a close look at how the negotiations are progressing will be the best approach for trading this pair.

Technically the pair is neutral. Therefore, it is best to wait until last week’s positions will take profit at 1.3400.

 

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