29 June 2018

UK Final GDP: Friday, 8:30. The British economy suffered a significant slowdown in the first quarter of the year. It grew by only 0.1% q/q and 1.2% y/y according to the first and second reads. The final release will likely repeat the same figures. Also in the UK, the second quarter already looks more promising.

Euro-zone inflation report: Friday, 9:00. Euro-zone inflation bounced back in May, with the headline reaching 1.9% y/y. While the headline figure was driven by energy prices, the ECB may have comfort that also core prices went back to normal with 1.1%. Small deviations are on the cards in the preliminary read for June.

Canadian GDP: Friday, 12:30. The Canadian economy grew by 0.3% in the month of March, the last month of Q1. The upcoming read is a sneak peek at Q2, which may show a slightly slower growth rate. Canada is unique in publishing its GDP read on a monthly basis.

US Core PCE Price Index: Friday, 12:30. This is the favorite inflation measure of the Federal Reserve. After Core CPI rose from 2.1% to 2.2% in May, core PCE will likely follow suit and pick up from 1.8% to 1.9% y/y. An increase to 2% could lead the Fed to further hawkishness. The CPI and PCE releases use different methodologies and this explains the difference.

USD
US Core PCE Price Index

CAD
Canadian GDP

EUR
Euro-zone inflation report

GBP
UK Final GDP

  • EURUSD

Update: the pair is still traded above the uptrend line. As we can see on the daily timeframe that the pair is traded above an uptrend line shown in red on the chart above. The continuation of trading above the uptrend line opens the door for further upward movement during the week that it may reach the level of 1.20. This is conditioned by the continuation of trading above the uptrend line.

Resistance levels: Support levels: Recommended:
▪ 1.21
▪ 1.20
▪ —
▪ 1.17
▪ 1.1650
▪ 1.1600
We are bullish as long as the pair is traded above the uptrend line.
  • GBPUSD

Update: the pair is still traded above the uptrend line, the breakout is not confirmed yet. We mentioned last week that the pair went through the uptrend line. It seemed that it was a breakout but it was just a shadow (the low price of the day) and the breakout was not confirmed as there was no daily close below the uptrend line. As a result, the pair may go up to reach the level of 1.33 followed by 1.34 during the week. This is conditioned by the continuation of trading above the uptrend line.

Resistance levels: Support levels: Recommended:
▪ 1.36
▪ 1.35
▪ 1.34

▪ 1.3150
▪ 1.3000
We are bullish as long as the pair is traded above the uptrend line..
  • GOLD

Update: First target at 1250 was hit. As could be seen on the daily chart that the pair managed to break through an uptrend line and the breakout was confirmed by a daily close. Therefore, we may go short targeting the level of 1260 followed by 1250 then 1240 during the week. This is conditioned by the continuation of trading below the broken uptrend line.

Resistance levels: Support levels: Recommended:
▪ 1330
▪ 1320
▪ —

▪ 1250
▪ 1240
We are bearish as long as the pair is traded below the uptrend line.
  • AUDUSD

Update: the pair is still traded above the uptrend line. We stated last week that the pair has been traded above an uptrend line. This is a very bullish indicator that bullish bias may continue but this is not everything as the Gold is bearish which could lead the AUD to a strong bearish movement very soon. Let’s wait for some bullish evidence to show up above the uptrend line.

Resistance levels: Support levels: Recommended:
▪ 0.7550
▪ 0.7600
▪ —
▪ 0.7370
▪ 0.7300
Waiting for the pair to show up some bullish evidence above the uptrend line.
  • GBPJPY

Update: the pair is still traded above the downside of the ascending channel. Having the pair traded within an ascending channel can open the door for further upward movement during the week that the pair may reach the level of 150. This is conditioned by the continuation of trading above the downside of the channel.

Resistance levels: Support levels: Recommended:
▪ 156
▪ 155
▪ 150.50
▪ 144
▪ 144
▪ 143
We are bullish as long as the pair is traded above the downside of the channel.

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