Major Currencies Overview
The dollar had a mixed run as it took advantage of trade-related risk-off flows but still lost ground to other safe-haven rivals.
The main economic event for the dollar this week is the U.S. retail sales report, but dollar traders are likely to keep taking cues from overall sentiment. Read more.
The Loonie had a mixed run as took hits from geopolitical tensions and downbeat jobs data later in the week, prompting speculations of a BOC rate cut.
There are no major economic reports up for release from the Canadian economy for this week, so traders might take cues from crude oil and sentiment once again. Read more.
EUR & CHF
Economic figures from the euro zone weren’t exactly all that positive, but the shared currency and the Swiss franc managed to scrape some gains from risk-off flows.
Only the German ZEW economic sentiment and Q2 GDP are up for release from the region this week, so it’s likely that risk appetite might stay as the main driver. Read more.
Sterling didn’t have plenty of economic releases to chew on, leaving it vulnerable to Brexit developments and more indications of a “no deal” outcome.
This week has a bunch of top-tier reports, namely the jobs data, CPI, and retail sales figures, lined up. Can these releases put an end to the pound’s negative streak? Read more.
Risk aversion worked in favor of the lower-yielding yen once more as worsening trade tensions drew traders to safe-havens.
There are no major catalysts from Japan this time, which could keep yen pairs sensitive to trade developments and overall market sentiment. Read more.
The Aussie had a rough run as it was bogged down by trade tensions between the U.S. and China, along with downbeat data and more rate cut expectations.
Australia’s jobs report is up for release this time, and this could either support or downplay further easing hopes. Also, China has a data dump coming right up! Read more.
The Kiwi was sent reeling from a surprise RBNZ cut of 0.50% mostly on account of worsening trade tensions.
There are no major reports due from New Zealand this week, which means that sentiment might be the main catalyst for Kiwi pairs. Read more.
Charts to Watch:
Counter trend setup, anyone? AUD/USD has been trending lower as it formed lower highs and lower lows in a descending channel. Price is currently testing support and might be due for a pullback to resistance from here.
This lines up with the 61.8% Fibonacci retracement level around .6935 while the 38.2% level is closer to the mid-channel area of interest. Stochastic is just pulling up from the oversold region to signal that buyers are returning.
Here’s a potential break-and-retest situation for y’all! EUR/CAD recently busted through resistance around the 1.4700 mark and might be due for a correction.
Price is currently down to the 50% level, which already seems to be holding as support. Stochastic is already turning higher to signal that bullish momentum is picking up, possibly taking the pair back to the swing high and beyond.
Lastly, here’s another counter trend setup on a longer-term time frame. Price is closing in on the .6100 major psychological mark at the descending channel support, possibly spurring a bounce back to the top or the middle.
Stochastic is already indicating oversold conditions and is turning slightly higher to signal that buying momentum is returning. A break below support, on the other hand, could lead to a sharper slide.