EURUSD continued declining last week as it was widely expected. Apart from the FED rate hike that pushed down the pair, the populism fear from Italy came back to the game. After it was announced that there was a deficit budget of 2.4%, (worst that 1.6% estimated), this ignited an unlikely controversial discussion in the coming European commission in October. It is expected that the E.C. will reject the budget and this will probably result in the downgrading of the Italian Economy. On this week’s economic calendar, traders will focus on European Markit Manufacturing PMI, with expectations unchanged at 53.3, European unemployment rate, also unchanged at 8.2%, U.S. ISM manufacturing PMI, expected to be lower, U.S. ADP employment expected to be higher at 185K up from last 163K and finally on Friday U.S. nonfarm payrolls are expected to be lower at 188K from last 201K, on the other hand average hourly earnings are expected to be higher at 3%, up from last 2.9%.
Technically the pair is neutral. Our traders continue to trade the Fibonacci chart, using the trading style “buying into the dips”. Buy positions at 1.1674 (23.6%) and 1.1604 (38.2%) were opened and we expect them to continue buying at 1.1548 (50%) targeting profits around 1.1800
GBPUSD Bulls continue to feel the pain from the persisting downside move. As this pair is mainly driven by Brexit negotiations instead of economic data, this downside picture might change at any time. A light economic calendar for GBP this week, traders will mainly focus on U.K. Markit Service PMI and the U.S. ADP employment and nonfarm payrolls numbers.
Technically the pair is neutral to positive. A retracement on the downside at 38.2% Fibonacci level on the 4H chart gives traders the opportunity to start buying once again at 1.3047 and we expect them to continue buying at 1.2907 (61.8%) and targeting profit at 1.3300.
*The material does not contain an offer of, or solicitation for, a transaction in any financial instruments. 10TradeFX accepts no responsibility for any use that may be made of these comments and for any consequences resulting in it. No representationor warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losing all your invested capital, so please make sure that you fully understand the risks involved.