EURUSD closed lower last week as US dollar recovered lost ground from the week before. This was due to the announcement of Tariff’s delay on Chinese products. Equity markets took the delay as positive and recover from their lows and that helped the US Dollar to gain lost ground from all major currencies. Economic data from the US are still positive and helping US dollar to strengthen. Apart from the US dollar, Euro is softening as investors are bracing for September’s ECB meeting, where a rate cut is expected. As for this week all eyes will be on FED’s Jackson Hole symposium.
In this week’s economic calendar, we have on Monday, European consumer price index with expectations pointing at 0.9%. On Wednesday, FOMC minutes will be released. On Thursday, German Markit manufacturing PMI is pointing lower at 43 and European Markit manufacturing PMI also lower at 46.3 later during the day the ECB will release their monetary policy meeting accounts. In the US Markit manufacturing PMI expected higher at 51. On Friday FED’s chairman Powell is going to give a speech at the Jacksons Hole symposium.
Technically, the picture is neutral, pair did not manage to hold above 1.1225 and that put the pair back to the downside move and now retesting the strong support of 1.1100 If this week will break and close below 1.1100 then we may see lower lows and the road opening for 1.0800. Our traders keeping open their positions at 1.1287 and 1.1225 and buying aggressively at 1.1124 targeting profits at 1.1400 and triggering stop losses below 1.1045
GBPUSD traded higher last week on the sake of strong economic data and the lack of bad Brexit news. Opposition party declared that will block any possible no deal Brexit, while a formation of other MPs declared a confidence vote for Boris Johnson to take place in September. In this week with not any economic data GBP will be the victim of Brexit news once again and the pair in the hands of its counterparty US Dollar.
Technically the pair is still negative. Even if retreated from lows and manage to keep the 1.2000 it is still very early to decide if this is a change of trend. A break and close above 1.2140 this week will signal a trend change and pair may start recovering ground. Our traders are waiting for a clear break above 1.2140 before they decide on opening new positions.
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