The USD rose to its strongest level in 7 weeks against the JPY (124.57) and to its highest level in 6 years versus the Australian dollar (72.54). Despite the lower than expected GDP growth in Q2 (2.3% vs. 2.5% expected) a September rate hike (first one in 9 years) is on the table and investors are positioning for the move by buying USD.
EURUSD dropped on the back of weaker German data, and news that the IMF will not participate in any new rescue package for Greece without debt restructuring. German unemployment (rose 9.000 instead of 5000 decline expected) also a reason for the EUR weakness. Technically, the possibility of a retest of 1.0820 is now quite likely.
Biggest loser Vs the USD was the NZD which lost 0.75% on a combination of bad housing data, strong USD and a drop in commodity prices. AUDUSD also suffered due to bad housing data and general USD strength. Over the next 24 hours, Australian PPI and New Zealand business confidence numbers are scheduled for release.
GBPUSD looks to be the most resilient currency so far. Next week is important as the BoE, for the first time will release its policy decision, the meeting minutes, the votes and the macroeconomic forecasts simultaneously.
On the data front, it is quite a busy day with German Retail Sales, EU CPI & US Consumer Confidence releases standing out.
Trading quote of the day: “No profession requires more hard work, intelligence, patience, and mental discipline than successful speculation.” – Robert Rhea
USDCAD
Pivot: 1.295
Likely scenario: Long positions above 1.295 with targets @ 1.305 & 1.3095 in extension.
Alternative scenario: Below 1.295 look for further downside with 1.291 & 1.286 as targets.
Comment: The pair has broken above a declining trend line and should post further advance.
USDCHF
Pivot: 0.972
Likely scenario: Short positions below 0.972 with targets @ 0.9635 & 0.96 in extension.
Alternative scenario: Above 0.972 look for further upside with 0.974 & 0.9765 as targets.
Comment: The RSI is badly directed.
OIL
Pivot: 49.5
Likely scenario: Short positions below 49.5 with targets @ 47.4 & 46.65 in extension.
Alternative scenario: Above 49.5 look for further upside with 50.5 & 51.4 as targets.
Comment: As long as 49.5 is resistance, likely decline to 47.4.
Pivot: 11320
Likely scenario: Short positions below 11320 with targets @ 11135 & 11070 in extension.
Alternative scenario: Above 11320 look for further upside with 11435 & 11550 as targets.
Comment: The RSI is mixed to bearish.
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