Date : 24th July 2015.
CURRENCY MOVERS OF 24th July 2015.
EURUSD, Daily
EURUSD price, continues to bounce from the May lows near 1.0820. This corrective bounce has attempted, but so far failed, to print a new lower top from the previous 1.1216 high. Yesterdays high of near 1.1018 was a good attempt at the 1.1030s, my previous article forecasted lower top. Traders should expect for the market to range between the 1.1030s and 1.0870s, now that the previous resistance turned support 1.0970s area has been deemed invalid, as price has tested the 1.0970s area both from below and above. Relevant support levels are now observed at 1.0920, 1.0870 and 1.0820, while resistance levels are spotted at 1.1030, 1.1087 and 1.1216. Given that the EURUSD price action is still firmly within the downward slopping price channel, as well as the fact that bullish momentum is observed within the Stochastic Oscillator analysis, I continue to be on alert for sellers to emerge around the 1.1020s-30s for a re-test of the 1.0820s; any breach of the 1.0820s will open up the way towards the 1.0750s.
Eurozone Jul PMIs disappointed today, with readings falling slightly from June. The manufacturing PMI dipped to 52.2 from 52.5 and the services to 53.8 from 54.4. However, data continues to show ongoing expansion across the Eurozone manufacturing sectors, which supports the ECBs view that the recovery remains intact and is broadening if not accelerating.
As for next weeks U.S. Fed policy statement, it should support Fed Chair Yellens testimony where she said that the FOMC is likely to begin liftoff this year, provided the economy continues to improve as forecast. Traders should prepare for a relatively positive assessment of the U.S. economy.
Currency Pairs, Grouped Performance (% change)
The new Currency Movers Charts show the percentage change from previous days close to the current moment against the other major currencies.
This afternoon the EUR is trading higher against the AUD. The AUD is weaker across the board against most pairs, while the JPY is stronger against the EUR.
Significant daily support and resistance levels for these pairs are:
Main Macro Events Today
EUR PMIs : French PMI readings were much weaker than expected, with the manufacturing PMI falling back below the 50 point no change mark to 49.6 from 50.7 in June. The services reading slumped to 52.0 from 54.1. German corrections were not quite as pronounced and the dips to 51.5 in the manufacturing PMI and 53.7 in the services reading from 51.9 and 53.8 point to a stabilisation, rather than a marked correction. Still, the weak French numbers, highlight that risks to the Eurozone recovery remain and that France continues to underperform.
JPY Japan flash manufacturing PMI : rose to 51.4 in July compared to 50.1 in June as both domestic orders and output rose the fastest clip in 5-months. New orders rose to 51.3 from 49.6, output gained to 52.3 from 50.9.
U.S. New Home Sales : June data on new home sales is out today and should reveal a 1.1% decline to a 540k (median 549k) pace from the 546k pace in May which set a new recent high.
Please note that times displayed based on local time zone and are from time of writing this report.
Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work.
John Knobel
Senior Currency Strategist
Hot Forex
Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.