Trading plan for 10/07/2017:
It looks like a quiet start of the week on the forex market. Some move up has been noticed only with USD/JPY pair as it is approaching the May high around 114.30 after Governor Kuroda's words about the need to continue loosening politics. EUR/USD is at 1.1405, GBP/USD is back above 1.2900. On Wall Street the trading week ended with a boost, so a good sentiment also prevails today on the exchanges in Hong Kong and Tokyo.
On Monday 10th of July, the event calendar is very light in important economic releases except for Trade Balance data from Germany and Sentix Investors Confidence data from Eurozone.
EUR/USD analysis for 10/07/2017:
The Sentix Investor Confidence Index is scheduled for release at 08:30 am GMT and market participants expect a slight decrease in sentiment from 28.4 points to 28.1 points. Nevertheless, today's Sentix Investor Confidence for the Eurozone is expected to hold close to its highest level in a decade, so it will affirm and support that the European growth has not only picked up from last year, but it's also sustaining a faster pace. Other economic data, that were released recently from the Eurozone support this view as well: PMI's were better than expected and Retail PMI increased to its highest level in nearly two years. Moreover, all the economic indicators are pointing out to better than expected GDP as well. For example, the Euro-Coin Indicator is currently projecting a 0.6% increase for the second quarter which will at least match the first quarter figures.
Let's now take a look at the EUR/USD technical picture at the H1 timeframe. The important local top had been established at the level of 1.1444, but if the data will beat the expectations, the top might be challenged again. This scenario would be valid as long as the technical support at the level of 1.1378 is not violated. Otherwise, the next technical support is seen at the level of 1.1355.
Market Snapshot: Crude Oil bounces towards resistance
The price of Crude Oil bounced a little after making a local low at the level of $43.79. Nevertheless, the bounce seems to be limited to the level of $44.61 so far. There is still a chance of a bigger bounce as the market conditions look oversold, but the momentum indicator clearly points to the downside.
Market Snapshot: USD/JPY on highs
The USD/JPY pair is trading close to its two months high around the level of 114.37. Nevertheless, on the H4 time frame there are a visible, multiple bearish divergences both on momentum and stochastic indicator. This might suggest a temporary pullback from the overbought levels and a test of the technical support at the level of 113.68.
