Weekly Technical Analysis For July 15th to 19th, 2019

Pay Attention To US Retail Sales And Eurozone CPI Data This Week

EUR/USD: 

Last week, Federal Reserve Chair Jerome Powell sent a clear signal that the Fed will cut interest rates for the first time in a decade later this month.

In Powell’s testimony, he said that since Fed officials met last month, “uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the U.S. economic outlook.” Powell’s dovish testimony started to price in heftier easing at the Fed’s next policy meeting on July 30-31.

On the other hand, the  U.S. inflation data came out stronger-than-expected last Thursday. The US core CPI, which excludes volatile food and energy prices, ticked up to 2.1% in the same period to beat the market expectation of 2%.

Looking ahead, the Commerce Department will release data on retail sales for June on Tuesday. The consensus forecast is that the report will show retail sales rose 0.2%, following a rise of 0.5% in May. Excluding the automobile sector, sales are expected to grow by 0.1%, after rising 0.5% in the preceding month. Rising retail sales over time correlate with stronger economic growth, while weaker sales signal a declining economy.

Other top-tier economic data due this week include Housing Starts, Building Permits, Philadelphia Fed Manufacturing Index as well as Michigan Consumer Sentiment.   

Moreover, the Eurozone will publish inflation figures for June on Wednesday. On the year-on-year basis, the Eurozone CPI is expected to stay at 1.2%. The core figure, without volatile energy and food prices, is seen holding steady at 1.1%, unchanged from the preceding month.

The Euro rose versus the US Dollar last week. In order for the upward movement to gain more momentum, it needs to break out and stay above 1.1285 on a four hourly basis. At this point, we will follow the daily resistance level at 1.1355. Otherwise, the daily support level will be at 1.1219.

Support:  1.1219 - 1.1103 - 1.0980

Resistance: 1.1285 - 1.1355 - 1.1450

GBP/USD:

The UK Office for National Statistics will release data on consumer price inflation for June on Wednesday. Analysts expect annual CPI to stay at 2.0% in June, while core inflation is forecast to rise to 1.8% from 1.7%.

The GBPUSD pair moved up above the 1.2528 main support level last week. If the upward movement continues, we will see the resistance levels at 1.2607 and 1.2668. On the other hand, if the pair drops below 1.2528, the next daily support level will be at 1.2395.

Support: 1.2528 - 1.2395

Resistance: 1.2607 - 1.2668 - 1.2723

USD/JPY:

The USDJPY pair found sellers from the 108.49 daily resistance level and showed a downward movement. Now, we will focus on the 107.70 main support level. In order for the downward movement to gain more momentum, it needs to break down and stay below 107.70 on a four hourly basis. Should this occur, we will face the next daily support level at 106.72. Otherwise, we will see 108.49 as a resistance level again.

Support: 107.70 - 106.72 

Resistance : 108.49 - 108.95 - 109.57 

GOLD: 

The GOLD price found buyers from the 1391 major support level and extended gains last week with the possibility of lower rates and weakness in the dollar. 

If the yellow metal’s price stays above 1414 on a four hourly basis. the upward movement may continue and the next resistance level can be seen at 1451. In contrast, If the price drops below 1414, the daily support level will be at 1391 again.

Support:  1414 - 1391 - 1364 

Resistance: 1451 - 1483

14 Jul 19 (Sun)

04:32 pm


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