By Orbex
Economic data on the day showed that Japan’s economy watchers sentiment rose to 48.3. This beat estimates of 47.3 but was weaker than the previous month’s 48.7.
The German trade balance data showed an increase to 18.3 billion beating estimates of 15.9 billion. The NY trading session showed Canada’s housing starts increased just 189k missing estimates of 203k.
The day ahead looks somewhat busy with the European trading session kicking off with the monthly GDP data. Economists forecast that the UK’s GDP advanced 0.1% on a month over month basis. This marks a somewhat slower pace of increase compared to 0.3% growth the month before.
The industrial, manufacturing and construction output report will also be coming out simultaneously.
Italy will be releasing the industrial production figures with estimates showing a rebound in activity. Industrial production fell 1.8% the month before.
Free Reports:
The NY trading session remains quiet. Canada’s building permits data is due. The U.S. producer prices report is expected to show a 0.2% increase following a 0.1% decline the month before. Core PPI is expected to rise by 0.2% as well.
EURUSD (1.15063): The EURUSD currency pair touched a fresh two month low yesterday. Price action fell to 1.1435 before recovering off the lows. The common currency managed to close with a doji. Price action briefly touched the support level at 1.1435, but there is scope for a firmer retest to this level. To the upside, the common currency will need to break out above the resistance level of 1.1547 – 1.1525 region. A clear break above this resistance could eventually push the euro toward 1.1718. To the downside, if the support is retested and it fails to hold the declines, we anticipate the euro to fall to 1.1315.
GBPUSD (1.3156): The GBPUSD maintained strong gains on Tuesday as price action closed with a bullish engulfing pattern after bouncing off the support region of 1.3054 – 1.3028. The GBPUSD could now be seen rising toward 1.3250 resistance which was previously tested. With the GDP and other economic reports due today, a beat on the estimates could act as a catalyst. To the downside, there is a risk that the GBPUSD could once again fall back to the support level. This could potentially weaken the support and expose the GBPUSD to test the lower support at 1.2808.
XAUUSD (1189.76): Gold prices tested the support at 1183.30 with price action forming a near double bottom at the support. This could potentially open the upside in price action. The resistance level at 1193.00 remains the first hurdle. A breakout above this level could put gold prices on track to test the 1200 level once again. Overall, price action in gold remains flat in the medium term. The long-term range has been established between 1212 and 1183 levels. A breakout from either of these levels will most likely signal the next direction.
By Orbex