01 August 2019

Chinese Caixin Manufacturing PMI: Thursday, 1:45. This independent forward-looking survey is considered a reliable barometer for the direction of the world’s second-largest economy. It has been below 50 – the threshold separating expansion and contraction – in the past few months. A minor drop from 49.6 to 49.4 points is forecast. China’s economy has suffered from US tariffs. Any significant fall may boost the safe-haven USD and JPY.

UK rate decision: Thursday, 11:00, press conference at 11:30. This is a “Super Thursday” event by the Bank of England. The BOE not only releases its rate decision and meeting minutes but also publishes its Quarterly Inflation Report (QIR) and holds a press conference led by Governor Mark Carney. The BOE has been assuming a smooth Brexit and has expressed its desire to raise rates amid a bustling economy and especially a booming labor market. This may all change now. The new Johnson government seems keen on a hard Brexit. Moreover, central banks all over the world have been removing their hawkish biases, signaling rate cuts, or slashing rates outright. The UK decision comes less than 24 hours after the Fed, and Carney and co. are likely to follow by removing their intention to raise rates. Nevertheless, the pound has already been suffering and may bounce on a “buy the rumor, sell the fact” response.

US ISM Manufacturing PMI: Thursday, 14:00. The forward-looking indicator has been on the back foot of late but remains above 50 – indicating ongoing growth in the manufacturing sector. A minor advance from 51.7 to 52 points is on the cards for July’s report – partly driven by the resumption of trade talks between the US and China. The index also serves as a hint toward Friday’s Non-Farm Payrolls.

 

 

USD
US ISM Manufacturing PMI:

GBP

 

  • EURUSD

The pair managed to breakthrough the support level of 1.1118 which opens the door for further downward movement. As could be seen on the chart above that the pair is traded above a strong support level that is 1.1118. Therefore, we are bullish as long as the pair is traded above it. Our first target is 1.1217.

 

Resistance levels: Support levels: Recommended:
▪ 1.1500
▪ 1.1450
▪ —
▪ –
▪ –
▪ 1.1118
We are bullish as long as the pair is traded above the level of 1.1118.
  • GBPUSD

Update: We are waiting for some bullish evidence to show up above the level of 1.20. As could be seen on the weekly timeframe that the pair is about to reach a strong support level that is 1.20 so we will be waiting for some bullish evidence to show up then we can go long targeting the level of 1.25 during the week.

 

Resistance levels: Support levels: Recommended:
▪ 1.36
▪ 1.3310
▪ 1.2550
▪ –
▪ –
▪ 1.20
We are bullish as long as the pair is traded above the level of 1.20.
  • GOLD

Update: We remain the same. The chart above shows that the pair is traded below a strong resistance level that is 1451. In case the pair shows up some bearish evidence below the mentioned above level, then we can go short targeting the level of 1400 during the week.

 

Resistance levels: Support levels: Recommended:
▪ 1460
▪ 1451
▪ 1365
▪ 1260
▪ 1265
We are bearish as long as the pair is traded below the level of 1451.
  • AUDUSD

Update: Still waiting for some bullish evidence to show up above the support level of 0.68. As could be seen on the chart above that the pair is traded above a strong support level that is 0.68. We will be waiting for some bullish evidence to show up then we can go long targeting the level of 0.71.

 

Resistance levels: Support levels: Recommended:
▪ 0.7550
▪ 0.7600
▪ 0.7000
▪ 0.6778
▪ 0.68
▪ –
We are bullish as long as the pair is traded above the level of 0.68
  • GBPJPY

Update: We are bearish as long as the pair is traded below the support level of 134. The chart above shows that the pair managed to breakthrough a strong support level that is 133. In case there is a daily close below it, we can go short targeting at least the level of 131 followed by 130.

 

Resistance levels: Support levels: Recommended:
▪ 156
▪ 155
▪ 141
▪ 132
▪ 131
▪ 130
Waiting for some confirmations.

 

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