We have tons of mid-tier data to look forward to but I bet only a few of them can move the major currencies.
Are you also looking at NZD/USD for opportunities?
Before moving on, ICYMI, today’s Asia-London session watchlist looked at EUR/JPY’s potential trend line support ahead of lower-tier releases from Japan and the Eurozone. Be sure to check that out if it’s still a valid play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
- Japan’s output, job availability jump but COVID curbs to slow growth
- Japan to expand state of emergency as COVID-19 surge shadows Olympics
- New Zealand building permits rise 3.8% in June
- China lifts yuan midpoint by the most since January
- World stocks eye sixth month of gains, dollar near one-month low
- Germany’s economy expands less than expected in Q3
Upcoming Potential Catalysts on the Economic Calendar:
- Eurozone’s flash CPI at 9:00 am GMT
- Eurozone’s flash GDP report at 9:00 am GMT
- Eurozone’s unemployment rate at 9:00 am GMT
- Canada’s monthly GDP at 12:30 pm GMT
- U.S. core PCE price index at 12:30 pm GMT
- U.S. personal income and spending numbers at 12:30 pm GMT
If you’re not familiar with the forex market’s main trading sessions, check out our Forex Market Hours tool.
What to Watch: NZD/USD
In case you missed it, FOMC Chairman Powell and his team did a number on the dollar earlier this week after they hinted that while they’ve heard about the concept of “tapering,” any implementation is still “a ways away” because the jobs market still has “some ground to cover.”
The idea of having easy money for longer drove traders away from the safe-haven dollar and into riskier bets like the Kiwi.In fact, NZD/USD has not only found support from a mid-channel level, but it has also broken above an established descending channel resistance in the last few trading sessions.
Let’s see if today’s U.S. core PCE price index – the Fed’s preferred inflation measure – would fire up the dollar bulls and bears.
Markets see the report printing a 0.6% gain in June after a 0.5% uptick in May.
Not a lot expect the Fed to react to the numbers, though, so it’s likely that a weaker-than-expected report would just accelerate the anti-dollar theme and complete NZD/USD’s break-and-retest situation on the 1-hour chart.
If the report prints wayyy higher than the 0.6% estimate, however, then there would be more pressure on the Fed to adjust its policies before prices pop up and stay up and probably limit Uncle Sam’s longer-term recovery.