Major Currencies Overview
The scrilla finally logged in a positive week thanks to positive trade developments and an upside NFP surprise.
It could be a slow start to the week on the lack of top-tier data, but the action might pick up later on as the FOMC minutes, U.S. CPI and PPI figures are up for release. Read more.
The Loonie was the top-performer for the previous week even though the Canadian jobs report fell short of estimates and crude oil tumbled mid-week.
The BOC interest rate decision is the main event for the week, which suggests that Loonie pairs could be in for more volatility. Read more.
EUR & CHF
The data-light week kept both the franc and euro sensitive to counter currency flows, barely establishing any clear direction then.
This time, price action might more or less be the same as only medium-tier reports are due. Still, the ECB minutes might lead to some strong moves here and there. Read more.
Sterling found itself near the very bottom of the forex pile in the previous week as BOE Guv’nah Carney acknowledged the threats from trade uncertainties.
Traders’ attention could still be fixed on “no deal” Brexit preps as U.K. PM front runner Boris Johnson appears open to this scenario. Other than that, the U.K. GDP and manufacturing production reports might spur short-term volatility. Read more.
The yen was able to make a strong showing for the week, even though Japan’s reports actually reflected weaknesses.
A handful of medium-tier economic reports are up for release this week, and another round of disappointments could remind traders of BOJ easing speculations. Read more.
Just when it seemed that the Aussie was in for a losing week, it was actually able to pull higher even though the RBA cut interest rates.
There are no major reports from the Land Down Under today, which suggests that the currency could take its cue from overall market sentiment. Read more.
The Kiwi was extra sensitive to overall market sentiment and dollar action in the previous week since there were no top-tier reports from New Zealand.
The coast is clear in terms of major economic catalysts for the Kiwi this week, so counter currency price action might once again dictate where the pairs are headed. Read more.
Charts to Watch:
Reversal alert! This pair might be done with its slide as it formed an inverted head and shoulders pattern on its 4-hour time frame. Price seems to be breaking past the neckline already, possibly setting off a climb that’s the same height as the formation.
This pattern spans around 150 pips, so the resulting breakout could take it up to 110.00. However, stochastic is already in the overbought zone, hinting that sellers might take over from here.
Here’s one for retracement traders out there! AUD/JPY seems to be in correction mode as it pulls up from the 74.00 handle and closes in on the 38.2% level close to the 76.50 minor psychological mark.
Stochastic is already on the move down to show that bearish pressure is picking up, possibly dragging price back to the swing low. A continuation of the pullback, on the other hand, could take it up to the area of interest around the 61.8% level.
Lastly, I’ve got this potential retest situation on the 4-hour chart of EUR/NZD. The pair recently fell below a rising trend line to signal that a reversal from the uptrend is due.
However, support at the 1.6800 mark has been holding like a boss, likely spurring a correction to the broken trend line support. This is spanned by the 50% to 61.8% Fibs around 1.7040 to 1.7100.