Weekly Technical Analysis For April 20th to 24th, 2020
Pay Attention To UK CPI Inflation, Manufacturing And Service PMI This Week
Last week, U.S. President Donald Trump announced guidelines for a return to work in the economy - a gradual, three-stage process dependent on robust virus testing and subject to state governors' discretion.
A news report on signs of success in a COVID-19 treatment drug trial as well as early plans to re-open the U.S. economy drove fresh optimism and risk appetite.
In the upcoming week, we will closely watch the Core Durable Goods Orders in the US. Durable goods orders excluding transportation in the meantime are expected to drop to -6.0% in March from a -0.6% fall in the previous month.
Moreover, the economic calendar will bring an update on the health of the U.S. economy, with reports on Existing Home Sales, New Home Sales, Michigan Consumer Sentiment, Manufacturing, and Service PMI.
In the Eurozone, Keep your eye on a report on activity in the manufacturing sector. German Manufacturing PMI will be announced on Thursday and it is expected to come out at 39.0 while Eurozone Manufacturing PMI is expected to be 40.0 in April. A reading below 50 indicates a contraction in the sector.
The EURUSD pair showed a downward movement and closed last week below the 1.0876 daily resistance level. If the fall continues below 1.0876, we will follow 1.0806 and 1.0728 as support levels. On the other hand, if the pair rises above 1.0876, the next resistance level will be at 1.0930.
Support: 1.0806 - 1.0728 - 1.0623
Resistance: 1.0876 - 1.0930 - 1.0965
The UK Unemployment Rate will be important for Sterling on Tuesday. It is expected to stay at 3.9% in February, the same as the previous reading. A higher than expected reading should be taken as negative for the Sterling
The UK CPI Inflation will also be an important release. The CPI measures the change in the price of goods and services from the perspective of the consumer. The UK CPI inflation is expected to ease to 1.5% from 1.7% year-on-year.
We are closely watching the main support level of 1.2502. If the price stays above 1.2502 on a four hourly basis, we will see the resistance level at and 1.2572. Otherwise, if the price moves down below 1.2502, and we will see the next support level at 1.2428 again.
Support: 1.2502 - 1.2428 - 1.2286
Resistance: 1.2572 - 1.2671 - 1.2768
The USDJPY pair is trading above the 107.52 main support level. As long as the pair stays above 107.52, on a four hourly basis, the daily resistance level can be found at 107.82. On the other hand, if the price falls below 107.52, the next support level will be at 107.22.
Support : 107.52 - 107.22 - 108.98
Resistance: 107.82 - 108.18 - 108.52
The Gold price showed a profit-taking action and dropped below the 1684 major level. If the price stays below 1684, on a daily basis, the downward movement may continue and we will follow 1667 and 1650 as support levels. Otherwise, if the price rises above 1684, the bullish action will return to the market.
Support: 1667 - 1650 - 1638
19 Apr 20 (Sun)
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