Global macro overview for 24/07/2017:
The latest data from US Manufacturing and Services sectors might surprise market participants. Preliminary estimates of economic activity in this two sectors will be released during the US session and market participants expect another round of positive economic data. The PMI Services sector is expected to maintain a moderately strong rate of growth, which is still above the fifty level. The PMI Manufacturing sector is also expanding at a good pace and keep up above the fifty level as well.
Manufacturing is a leading indicator of economic health - businesses react quickly to market conditions, and their purchasing managers hold perhaps the most current and relevant insight into the company's view of the economy. Last week regional manufacturing data from the US posted little softer figures as both New York Fed and Philly Fed Manufacturing Indices felt, which might indicate the third quarter will get a little cooler than the first two. Nevertheless, the underlying trend of reported output to is still moving up and it is expected to gradually accelerate over the coming months.
Let's now take a look at the USD/JPY technical picture on the H4 time frame. The market has broken below the 61%Fibo at the level of 110.97 and currently is trying to test the nearest technical support at the level of 100.61. The growing bullish divergence and oversold market conditions indicate a possible bounce towards the level of 111.71.
