Last week the greenback traded lower following disappointing advance retail sales data in the US. The US advance retail sales remained flat on a monthly basis in July, raising concerns about consumer spending being able to drive the nation’s economic growth in the third quarter. Meanwhile, the nation’s flash Michigan consumer confidence index rose less than forecasted in August. Moreover, the number of people filing for fresh unemployment benefits dropped slightly during the week ended 06 August, indicating that the nation’s labor market continues to gain momentum. Also, the nation’s labor market conditions index rebounded for the first time this year in July. Also the NFIB small business optimism index unexpectedly inched higher in the same month. Moreover, the economic optimism index rose more than forecasted in August. Further, MBA mortgage applications advanced for the first time in four weeks during the week ended 05 August. Moreover, the JOLTs job openings rose less than expected in June. Meanwhile, the nation posted a budget deficit in July.
The Euro traded higher against the USD, after preliminary GDP data indicated that economic growth in Germany, Eurozone’s largest economy, grew at a faster than expected pace 0.4% on a quarterly basis during the three months ended June. Additionally, the nation’s seasonally adjusted industrial production came in better than anticipated on a monthly basis in June. Further, the trade surplus widened in June. Also, the nation’s imports advanced on a monthly basis in June while exports rose less than expected on a monthly basis in the same month.
Separately, flash GDP data revealed that Eurozone’s economy expanded at its slowest pace since the middle of 2015, growing by 0.3% on a quarterly basis in the second quarter, indicating that the region’s economic growth was already running out of steam, even before the UK voted to leave the EU, as risks related to the outcome of European Union (EU) referendum clouded the economic outlook. Additionally, the region’s industrial production rebounded more than expected on a monthly basis in June. In other economic news, Eurozone’s Sentix investor confidence index rose in August, indicating that Britain’s decision to leave the EU had a milder impact on investor sentiments.
The JPY traded higher against the USD. In economic news, Japan’s current account surplus dropped to its lowest level since January in June. On the other hand, the nation’s manufacturing production contracted for the second straight month on a monthly basis in June. Further, the nation’s total trade deficit expanded to the highest level since March 2015 in June.
EURUSD
The EUR traded 0.69% higher against the USD last week, with the pair closing at 1.1162, after Germany’s seasonally adjusted flash GDP rose more than anticipated 0.4% on a quarterly basis in 2Q 2016. Moreover, the final consumer price index advanced 0.3% on a monthly basis in July, at par with market expectations. Moreover, the seasonally adjusted industrial production advanced more than anticipated on a monthly basis in June. Further, the nation’s trade surplus widened in June. Also, imports advanced on a monthly basis in June, while exports rose less than expected on a monthly basis in the same month. Separately, Euro-zone’s seasonally adjusted preliminary GDP expanded 0.3% QoQ in the second quarter, in line with market expectations. Meanwhile, the region’s seasonally adjusted industrial production rebounded on a monthly basis in June. Also, the Sentix investor confidence index rose in August. During the previous week, the pair traded at a high of 1.1221 and a low of 1.1071. The pair is expected to witness its first support at 1.1082 and second support at 1.1001, while the first resistance is expected at 1.1232 and second resistance at 1.1301. Moving ahead, investors will look forward to ECB’s account of monetary policy along with Eurozone’s consumer price index, ZEW economic survey and trade balance data, all due to release this week.
GBPUSD
Last week, the GBP traded 1.17% lower against the USD and closed at 1.2920, after the NIESR estimated that UK’s economy grew at a slower pace of 0.3% in the three months through July 2016. Meanwhile, the nation’s BRC retail sales across all sectors unexpectedly rebounded on an annual basis in July. On the other hand, RICS house price balance declined in July. Moreover, the nation’s seasonally adjusted construction output declined more than expected on an annual basis in June. The pair traded at a high of 1.3097 and a low of 1.2904 during the previous week. The pair is expected to find its first support at 1.2850 and first resistance at 1.3043. The second support is expected at 1.2781 and second resistance at 1.3167. Going forward, UK’s consumer price index, ILO unemployment rate, retail sales and public sector net borrowing data, all slated to release this week, would garner lot of market attention.
USDJPY
Last week, the USD traded 0.51% lower against the JPY and closed at 101.3. Macroeconomic data indicated that, Japan’s current account surplus dropped more than expected in June. Additionally, the manufacturing production contracted more than anticipated on a monthly basis in June. Further, the total trade deficit rose in June. Also, the preliminary machine tool orders dropped on an annual basis in July. In other economic news, the nation’s industrial production rose on a monthly basis in June, at par with investor expectations. Additionally, the tertiary industry index rebounded more than estimated on a monthly basis in June. Further, the Eco Watchers Survey for the current situation as well as for the future outlook advanced more than expected in July. Moreover, the nation’s BOP basis trade surplus widened less than anticipated in the same month. Also, machinery orders rebounded more than expected in June. During the previous week, the pair traded at a high of 102.66 and a low of 100.83. The pair is expected to find its first support at 100.53 and first resistance at 102.36. The second support is expected at 99.77 and second resistance at 103.43. Looking ahead, market participants await the release of Japan’s preliminary 2Q GDP, industrial production, merchandise trade balance and all industry activity index data, all due this week.
USDCHF
During the previous week, the USD traded 0.64% lower against the CHF and ended at 0.9744. On the data front, Switzerland’s consumer price index fell less than expected on a monthly basis in July. Meanwhile, the seasonally adjusted unemployment rate remained steady at a level of 3.3% in July, at par with market expectations. The USD hit a high of 0.9844 and a low of 0.9708 against the CHF in the previous week. The pair is expected to find its first support at 0.9687 and first resistance at 0.9823. The second support is expected at 0.9629 and second resistance at 0.9901. This week, investors would closely monitor Switzerland’s ZEW survey data for August, the sole important release this week.
USDCAD
During the previous week, the USD traded 1.68% lower against the CAD and ended at 1.2951. Data showed that Canada’s building permits surprisingly eased on a monthly basis in June. Moreover, the nation’s new housing price index rose on a monthly basis in the same month. Also, housing starts dropped in July. Further, the nation’s Teranet-National Bank National house price index advanced on a monthly basis in July. The pair traded at a high of 1.3190 and a low of 1.2925 during the previous week. The pair is expected to witness its first support at 1.2854 and second support at 1.2757, while the first resistance is expected at 1.3119 and second resistance at 1.3287. Investors would now focus on the Canadian consumer price inflation data, the lone important data release in this week.
AUDUSD
The AUD strengthened against the USD last week, closing 0.43% higher at 0.7652. Macroeconomic data indicated that, Australia’s NAB business confidence index slid in July. Further, the NAB business conditions index declined in the same month. Moreover, the nation’s consumer inflation expectations fell in the same month. On the contrary, the Westpac consumer confidence index climbed in August. Meanwhile, the Reserve Bank of Australia’s (RBA) Governor, Glenn Stevens, reiterated that monetary policy alone cannot recover the nation economic growth as keeping interest rates too low for too long may not be in the nation’s favor. Further, he warned that if the economy needs to be revived it might have to come from government spending rather than interest rates only. During the previous week, the pair traded at a high of 0.7756 and a low of 0.7598. The pair is expected to find its first support at 0.7581 and first resistance at 0.7739. The second support is expected at 0.7511 and second resistance at 0.7827. Moving ahead, market participants would look forward to the minutes of the latest RBA meeting as well as the country’s employment figures, slated to release in this week.
Gold
During the previous week, gold traded marginally lower and ended at USD1335.97 per ounce, amid strength in global equities. The yellow metal witnessed a high of USD1363.60 per ounce and a low of USD1335.30 per ounce in the previous week. Immediate downside, the first support level is seen at USD1330.13 per ounce, followed by USD1318.57 per ounce, while on the upside, the first resistance level situated in USD1358.43 per ounce, followed by USD1375.17 per ounce.
Crude Oil
Crude oil strengthened in the previous week, closing 6.44% higher at USD44.49 per barrel, after comments from the Saudi Arabia’s Energy Minister about the possible action to stabilize oil market eased global glut concerns. Also, oil prices were boosted after the IEA predicted that crude markets would tighten in the second half of this year. Meanwhile, the Energy Information Administration (EIA) revealed that the US crude stockpiles rose more than forecasted by 1.1 million barrels to 523.8 million barrels during the last week, rising for the third consecutive week, while the American Petroleum Institute (API) indicated that US oil inventories surprisingly rose by 2.1 million barrels to 520.8 million barrels last week. Crude oil hit a high of USD44.78 per barrel and a low of USD41.10 per barrel in the previous week. Crude oil is expected to witness its first support at USD42.27 per barrel and second support at USD39.84 per barrel, while the first resistance is expected at USD45.95 per barrel and second resistance at USD47.20 per barrel.
Good trades Traders.
