Week ahead July 2nd – 6th   

EUR/USD

Last week showed a lot of volatility for the EURUSD pair. The pair rebounded from its new low of 1.15093 to make headway up to 1.18501, just to see EURUSD crash back down to 1.15077. The economic calendar is fairly light until later in the week. On Monday, we see the various European Manufacturing PMI’s being released with neutral to slightly lower than expected forecasts. Tuesday and Wednesday, have low impact economic news, however on Thursday, the monthly ADP Non-Farm Employment Change is predicted to read at 190k, which will push the EURUSD pair lower if the actual report is above June’s reading of 178k. Also on Thursday, the US Dollar will be affected by the release of ISM Non-Manufacturing PMI, which is forecasted as 58.3, lower than last month’s reported 58.6. Thursday also will release for the US Dollar the Crude Oil Inventory, but more importantly the FOMC meeting minutes. Friday is also a heavy news day for USD, releasing a neutral Average Hourly Earnings m/m, a weak Non-Farm Employment Change of 200k versus last month’s 223K, and a neutral Unemployment Rate.

Technical analysis shows that EURUSD is neutral. As last week’s volatility could not break below 1.15000 and we had another close above 1.1600 this gives us a more positive view. We maintain both open buy positions, targeting 1.2000 to take profit.

  

GBP/USD

Despite positive reports last week for the Pound, the market turned down until an attempted recovery on Friday the 29th, of June. This week we start off with an expected 54.1 Manufacturing PMI, for GBP, however this is lower than the last report of 54.4. On Tuesday, we see a slightly better than previous Construction PMI, forecasted at 52.6 over last month’s 52.5. On Wednesday, GBP will release its Services PMI predicted at 53.9, lower than the previous reading of 54.0. Finally on Thursday, the Pound can hope for a hawkish speech from Gov. Carney.

Technically the pair is bearish. With the week forecast as mentioned above and the selling pressure around 1.32800, it is best to set up short positions targeting 1.29800.

 

 

 

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