Article by ForexTime

The EURUSD traded in a very narrow range yesterday, which is hardly surprising considering the EURUSD fell to a fresh 2014 low the day prior.  All in all, the pair only moved around 20 pips before concluding trading at 1.3454.

In regards to today, Thursday is EU PMI day. Last month, the EU PMIs showed that there were strong indications that economic activity within the EU was slowing down and led to IMF Head, Christine Lagarde stating at a June speech in Luxembourg that the EU recovery was not robust enough.  If today’s PMI release encourages a negative market reaction, further EURUSD moves to the downside would be likely.  The next support level is situated at 1.3438, while resistance can be found at 1.3474.

Moving onto the GBPUSD, the BoE Minutes release failed to promote any type of hawkish market reaction and as a result of this, the Cable recorded its sixth day of consecutive losses for the first time since January 2013.  The currency pair found support at a June resistance level, 1.7037.

Today, the latest UK Retail Sales are announced and at the moment, the prospects for this release are negative.  The British Retail Consortium (BRC) are reporting that June’s retail sales increased by only an annualized 0.6%, while the Confederation of British Industry (CBI) are reporting that retail sales slowed to a seven-month low.

If this proves to be accurate, the GBPUSD could be set to record its seventh day of successive losses for the first time since May 2012. The next GBPUSD support levels are located at 1.7004 and 1.6979. A move to the latter would represent the first time the GBPUSD has fallen below 1.70 since late June.

The USDJPY recorded its fourth day of successive gains and concluded trading at 101.477. Investors have been seeking the USD as a safe-haven this week, due to the shock over the unfortunate tragedy in Eastern Europe last Thursday.

Today, the latest Initial Jobless Claims are released from the United States while Japanese CPI is announced this evening. Particular attention should be paid to the latter, because the past two Japanese CPI’s have been distorted due to a Japanese sales tax implemented in April.  USDJPY resistance can be found at 101.620 and 101.881. Support is located around 101.404 and 101.172.

In reference to the Aussie, the financial markets reacted favorably to the news that Australian CPI advanced to an annualised 3.0%, alongside Chinese Manufacturing PMIs rising to an 18-month high. Consequently the AUDUSD is closed at a two week high, 0.9455.

Economic data is low today though and with the RBA looking to talk down the AUD at any given opportunity, logic would suggest that this pair will retreat slightly in valuation. Support levels can be found at 0.9437, 0.9416 and 0.9363.

By following the old cliche in perhaps saving the best to last, the NZDUSD dropped by nearly 100 pips overnight with Bloomberg reporting that the Kiwi tumbled by the most it has experienced in six months.

Although the RBNZ hiked interest rates for the fourth consecutive month, Governor Graeme Wheeler strongly signaled that there would now be a pause in tightening from the Central Bank. Wheeler also expressed that the level of the New Zealand Dollar is unjustifiable and unsustainable.

Upcoming NZDUSD support levels are located at 0.8582 and 0.8562.

Written by Jameel Ahmad, Chief Market Analyst at FXTM.

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Article by ForexTime

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