Trading plan for 18/08/2017:
The US Dollar is losing against all major currencies. The strongest are GBP, JPY, and SEK. The global investors are shocked after yesterday's attacks in Barcelona: Gold lost 0.1%, Silver is down 0.35%. On the Asian stock market sentiment is still negative: Nikkei drops -1.2%, Hang Seng -0.55%, Shanghai Composite gains + 0.1%. In the US Nasdaq 100 falls -2.05%, the S&P 500 -1.54% and the Dow Jones -1.24%.
On Friday 18th of August, the event calendar is busy in an important news release only during the US session. During this session, Canada will release Consumer Price Index data and the US will release Preliminary UoM Consumer Sentiment and Baker Hughes U.S. Rig Count data. At the end of the trading day, there is a scheduled speech by FOMC member Robert Kaplan.
EUR/USD analysis for 18/08/2017:
The Preliminary UoM Consumer Sentiment Indicator data are scheduled for release at 02:00 pm GMT and the mid-August sentiment index is expected to climb to 94.5 from 93.4 at the end of July. The consumer sentiment index fell in June and July but still remained at relatively elevated levels. The rapid fall for two months, despite the still-improving US labor market and stock markets trading near all-time-highs, most likely mirrors political worries, both on the domestic and the international level. The political divisions are still significant, but the sentiment divergence seems to be decreasing. While supporters of the Democratic party still hold a very negative economic outlook, supporters of the Republican party have somewhat moderated their optimistic outlook. Nevertheless, none of the reforms promised during the Trump's presidential campaign (tax reform, Obamacare reform) have been completed and introduced to the US society. This event will surely weight soon on the overall sentiment levels in the US, even among the Trump supporters. In the result, the weakening in the sentiment level will directly influence the US Dollar, pushing it to even lower levels than it is now.
Let's now take a look at the EUR/USD technical picture at the H4 time frame. The market is slowly moving lower towards the important technical support at the level of 1.1614, but the whole move looks like a part of the bullish flag pattern. The momentum is still too weak to move above its fifty level, but when it does before the support is violated, then the swing high at the level of 1.1908 will likely to be tested again ( and possibly broken).
Market Snapshot: Gold just below the key resistance
After the terrorist attack in Barcelona, the price of Gold is climbing higher towards the key technical resistance at the level of $1297. If this level if violated, then the next technical resistance is seen at the level of $1308. The increasing momentum is supporting the bullish view.
Market Snapshot: USD/JPY close to the support
The price of USD/JPY reversed from the technical resistance at the level of 111.04 and now is getting close to the technical support at the level of 108.79. The momentum points down and the stochastic oscillator is still negative, so it is likely this support will be tested and broken. The next technical support is seen at the level of 108.47.
