Start your trading week right by prepping for these top-tier catalysts and checking out my potential trade setup.
Don’t forget to review which factors drove forex market price action last week, too!
Major Economic Events:
Chinese official manufacturing PMI (June 30, 1:00 am GMT) – Another slight dip in Chinese manufacturing activity is eyed, as the official PMI is slated to fall from 51.0 to 50.9.A stronger than expected read, however, would reflect a faster pace of industry growth in one of the world’s largest economies. In turn, this could spur a surge in risk-taking, which would likely benefit higher-yielding commodity currencies.
OPEC-JMMC meetings (July 1) – With WTI crude oil hovering above the $70 per barrel mark, traders are keen to find out what the Black Crack Mafia might have up its sleeve.
Any indication that the cartel is looking into adjusting its output deal might revive oversupply concerns, which might then weigh on crude oil prices.
U.S. NFP report (July 2, 12:30 pm GMT) – The main event for this week would probably be Uncle Sam’s jobs release, as market watchers are looking for clues on whether or not the Fed could taper soon.Recall that the FOMC acknowledged the pickup in inflation but warned that they’d need to see stronger employment figures before adjusting monetary policy.
The past couple of NFP reports haven’t turned out so well, though, so another major jobs disappointment could mean plenty of downside for the Greenback. Analysts are projecting an increase of 700K in hiring for June.
Forex Setup of the Week: AUD/USD
This pair recently fell through the floor at the .7600 major psychological mark, which happens to be the neckline of a long-term head and shoulders formation.A pullback is happening at the moment, and the upcoming top-tier data releases from China and the U.S. might determine if the downtrend could pick up.
AUD/USD is already retesting the broken support, which might hold as a ceiling around the Fibonacci retracement levels. In particular, the 50% level is right smack in line with this area of interest where sellers might be hanging out.
Just be careful since technical indicators on the daily time frame are suggesting a possible continuation of the climb. The 100 SMA is above the 200 SMA while Stochastic is indicating oversold conditions or exhaustion among sellers.