US tariffs on China come into effect: Friday. The US announced tariffs on Chinese goods worth $50 billion a few weeks ago, but they will come into effect on July 6th. China announced it would retaliate. The time between the announcement and the actual imposition was seen as allowing for negotiations to proceed. However, there have been no meaningful movements in defusing the situation. If a last-minute deal is struck, a risk-on atmosphere could sink the yen and also weigh on the US Dollar, especially against commodity currencies. If mutual tariffs are imposed and the US announces a counter-retaliation to Chinese tariffs, the greenback could suffer.
US Non-Farm Payrolls: Friday, 12:30. The first Friday of the month features the king of economic indicators. The jobs report for May was upbeat with a gain of 223K, better than expected, and a monthly rise of 0.3% in wages, which are no less important. Year over year, salaries were up by 2.7% in May. Similar figures are on the cards for June: an increase of 200K jobs and another pay rise of 0.3% m/m. Any movement towards 3% y/y wage growth would be cheered by the US Dollar, while a deceleration towards 2.5% would hurt it. Job gains would need to fall below 150K to hurt, or climb above 250K to have a meaningful impact.
Canadian jobs report Friday, 12:30. Canada suffered two consecutive months of falls in jobs, with a loss of 7.5K positions in May. A rebound is likely now. The unemployment is projected to remain at 5.8%. It is important to note that wage growth is becoming more important in Canada. The 3.9% y/y rise in May supported the loonie despite the disappointing drop in jobs.
USD
US tariffs on China come into effect
US Non-Farm Payroll
Canadian jobs report
US tariffs on China come into effect
- EURUSD
Update: On its way to the level of 1.19. The daily chart shows that the pair is traded above an uptrend line shown on the chart in red. The expected scenario for this week is that if the pair continues to be traded above the uptrend line, this opens the door for further upward movements during the week that it may reach the level of 1.1950 followed by 1.20.
| 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: We remain bullish as the pair is still traded above the uptrend line. As could be seen on the daily chart that the pair managed to breach an uptrend line shown on the chart in red but we believe that the breakout of the trendline is not confirmed yet. To be confirmed, the pair must breach the level of 1.3050 with at least a daily close, otherwise the pair may continue going up to reach the level of 1.34 followed by 1.35 during the week. This is conditioned by the continuation of trading above the level of 1.3050.
| Resistance levels: | Support levels: | Recommended: |
| ▪ 1.36 ▪ 1.35 ▪ 1.34 |
▪ ▪ 1.3150 ▪ 1.3050 |
We are bullish as long as the pair is traded above the level of 1.3050. |
- GOLD
Update: On its way to the level of 1255. As we can see on the daily chart that the pair is traded above a strong support level that is 1235 so we believe that as long as the pair is traded above it, it is highly recommended to go long targeting the level of 1280 during the week. An alternative scenario: If the level of 1235 is broken, the way is open for the pair to reach the level of 1220 followed by 1210.
| Resistance levels: | Support levels: | Recommended: |
| ▪ 1330 ▪ 1320 ▪ — |
▪ 1235 ▪ 1220 ▪ 1210 |
We are bullish as long as the pair is traded above the level of 1235. |
- AUDUSD
Update: The pair started moving upwards as expected, first target: 0.75. As we can see on the daily timeframe that the pair is 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. As could be seen on the daily timeframe that the pair is traded within an ascending channel. To be exact, the pair is traded right above the downside of the channel which means that there is a high potential that the pair may continue going up to reach the level of 150 during the week.
| 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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