Week Ahead December 4 – 9
EURUSD pair closed last week’s trading session lower on hawkish FED’s officials’ speeches. All officials including FED’s Powell commented that is premature to talk about cutting interest rates. FED’s Powell in addition, commented that another interest rate increase is still on the table. Euro-zone inflation came out softer than expectations and this added more downside pressure on the pair as any chances for another interest rates increase is waived as the EU CPI is coming closer to ECB’s target.
As for this week traders and investors will focus on the US non-farm payrolls and ECB’s Laggard speech. If Mrs. Laggard will deliver a dovish speech, pair could accelerate losses.
On the economic calendar we have on Tuesday, the US ISM services PMI pointing higher at 52. On Wednesday, European retail sales expected lower at -0.9%, US ADP employment, expected at 120K On Thursday, European gross domestic product to remain unchanged at 0.1% On Friday, German Harmonized index of consumer prices to remain unchanged at 2.3% US Non-farm payroll expected at 180K and US Michigan consumer sentiment, higher ta 61.8
Technically the picture is positive after last week’s close above (50%) at 1.0880 In this week’s trading session if pair continues on the upside and break and close above (61.8%) could open the road for 1.1300 (100%) If resumes on the downside it will retest 1.0750 (38.2%) Our traders opened new short positions at 1.0960 targeting profits at 1.0700. We are expecting more aggressive short positions on the way up and new buyers at 1.0700
GBPUSD pair closed last week’s trading session higher on hawkish comments from BOE’s MPs. Many MPs have supported that interest will remain elevated until inflation 2% will be achieved. Strong labor market in the UK was another signal that the UK economy can afford high interest rates.
As for this week traders and investors will mostly focus on the US non-farm payroll. The lack of any economic releases from the UK will let the pair in the mercy of US economic releases.
On the economic calendar we have on Tuesday, UK BRC Like-for-like retail sales expected lower at 2.5%, and the US ISM services PMI higher at 52. On Wednesday, US ADP employment, expected at 120K On Friday, US Non-farm payroll expected at 180K and US Michigan consumer sentiment, higher ta 61.8
Technically the pair’s overall picture is positive after last week’s close just below (61.8%) at 1.2725 As for this week, if pair continues on the upside, a break and close above (61.8%) will accelerate gains and test 1.2830 Alternative, if resumes on the downside, will retest 1.2587 (50%) Our traders opened new short positions at 1.2710 targeting profits at 1.2500 We are expecting more aggressive short sellers on the way up and buyers to appear at 1.2500
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