Trading plan for 29/09/2017:
A quiet overnight Asian session in the currency market with a partial recovery of yesterday’s US Dollar weakness. NZD, GBP and JPY are the weakest, EUR/USD is trading flat. Small changes in the stock market. Crude Oil does not rise after Thursday’s decline.
On Friday 29th of September, the event calendar is busy with important news releases. During the London session, Germany will release Retail Sales, Unemployment Rate, and Unemployment Change data. France will post Consumer Spending and Consumer Price Index data, Switzerland will reveal KOF Economic Barometer data and the UK will present Mortgage Approvals, Net Lending to Individuals, Final GDP, and Current Account data. Later on, there will be Consumer Price Index Flash Estimate and Flash Core CPI data released from the Eurozone. During the US session, Canada will present Gross Domestic Product data and Raw Materials Price Index data. The US will post Personal Spending and Personal Income data, Revised UoM Consumer Sentiment data, and Chicago Purchasing Manager Index data. During the whole day, we will have speeches from various central banks’ representatives like BOE Deputy Governor for Monetary Policy Ben Broadbent, BOE Deputy Governor for Financial Stability Jon Cunliffe, BOE Governor Mark Carney, ECB President Mario Draghi, and FOMC Member Patrick T. Harker.
EUR/USD analysis for 29/09/2017:
Yesterdays, US GDP data were better than expected as the GDP was revised higher form 3.0% to 3.1% and the Unemployment Claims were released higher than expected at the level of 272k (while market participants expected 269k), with Continuing Claims falling to 1,934k (mkt: 1,993k; last: 1,979k). The advanced goods trade balance fell to -$62.9bn (mkt: -$65.1bn; last: -$63.9bn) with exports up 0.2% m/m and imports down 0.3%. The rise in claims was largely reflecting the increase in Florida after Hurricane Irma. However, this spike might be transitory and can be attributed to states affected by Hurricanes Harvey and Irma. The underlying pace of the US labor market remains strong. Today’s set of data from the US might further support the US Dollar across the board.
Let’s now take a look at the EUR/USD technical picture on the H4 time frame. The market bounced from the oversold conditions, but the momentum indicator remains under the fifty level. The next important technical resistance is seen at the level of 1.1821 and it looks like the price wants to test it from below. Only a clear breakout above this level opens the road towards the next technical resistance at 1.1936.
Market Snapshot: Gold bounces from support
The price of Gold has bounced from the support at the level of $1,276 and now is testing the technical resistance at the level of $1,287. Due to the oversold market conditions and a clear bullish divergence between the price and momentum oscillator, the corrective move up might target the level of $1,300 or even $1,308 before the down move resume.
Market Snapshot: Crude Oil rejected at channel resistance
The price of Crude Oil got rejected at the level of $52.86, just at the channel resistance level. The price broke through the technical support at the level of $51.98 and currently trades around the level of $51.47. The market conditions looks overbought and the next technical support (a possible target for a down move exptension) is seen at the level of $50.80.