Range Markets

Rate decisions

During the upcoming trading week market participants look to key interest rate decisions for the Bank of Japan, Bank of Canada, and the European Central Bank. The ECB interest rate decision and policy decision is set to headline the economic calendar this week, as the Governing Council deliver the latest assesement of the eurozone economy. The euro currency is expected to continue its recent rally against the greenback if the ECB strike a optimistic view towards the European economy.

Other highlights on the economic calendar this include CPI inflation data from Germany, UK, and the United States. Traders also look to the release of the Beige Book from the US Federal Reserve, and key monthly jobs numbers from the Australian economy.

Monday 13th July, UK Governor Bailey Speech

The Bank of England Governor Andrew Bailed is set to deliver a scheduled speech, where he will lay out his latest thoughts on the United Kingdom economy. Governor Bailey took office on March 16th, 2020, at the end of former Bank of England Governor Mark Carney’s term with the UK central bank. Governor Bailey has the ability to move the British pound currency if he strikes an overly dovish or hawkish policy statement.

  • The GBPJPY pair is only bullish while trading above the 134.00 level, key resistance is found at the 135.00 and 136.00 levels.
  • If the GBPJPY pair moves below the 134.00 level, sellers may test towards the 133.00 and 132.00 levels.

Tuesday 14th July, US Consumer Price Index

The United States Consumer Price Index is a key indicator that measures inflation and changes in purchasing trends, therefore CPI figures are closely watched by the US Federal Reserve. A rise in the Consumer Prices Index may determine whether the Federal Reserve increases interest rates in order to manage inflation and slow economic growth.

  • The GBPJPY pair is only bearish while trading below the 136.00 level, key technical support is found at the 133.80 and 132.00 levels.
  • If the GBPJPY pair trades above the 136.00 level, buyers will likely test towards the 136.80 and 138.00 levels.

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Wednesday 15th July, Bank of Canada Rate Decision

The Bank of Canada Interest Rate Decision is announced by the Bank of Canada, and is closely followed by the central banks latest monetary policy statement. If the Bank of Canada is hawkish about the inflationary outlook of the economy, and rises the interest rates it is positive for the Canadian dollar currency. If the central bank has a dovish view on the Canadian economy and keeps the ongoing interest rate it is seen as negative for the Canadian dollar.

  • The USDCAD pair is only bearish while trading above the 1.3590 level, further losses towards the 1.3500 and 1.3390 levels remain likely.
  • If the USDCAD pair trades above the 1.3590 level, buyers may test towards the 1.3650 and 1.3740 resistance levels.

Thursday 16th July, US Initial Jobless Claims

US Initial Jobless Claims is released by the US Department of Labor on a weekly basis, and is a measure of the number of jobless claims filed by individuals seeking to receive state jobless benefits. This figure measures the strength in the United States labor market, and is closely followed by both traders and investors.

  • The EURUSD pair is only bearish while trading below the 1.1260 level, key support is found at the 1.1190 and 1.1150 levels.
  • If the EURUSD pair trades above the 1.1260 level, buyers may test towards the 1.1380 and 1.1450 resistance levels.

Friday 17th July, US Comsumer Sentiment

The Michigan Consumer Sentiment Index released by the University of Michigan is a survey of personal consumer confidence in economic activity. It shows a picture of whether or not consumers are willing to spend money. Generally speaking, a high reading anticipates positive for the US dollar currency, while a low reading is seen as negative for the US dollar currency.

  • The USDCHF pair is only bearish while trading below the 0.9525 level, key support is found at the 0.9400 and 0.9280 levels.
  • If the USDCHF pair trades above the 0.9525 level, buyers may test towards the 0.9600 and 0.9710 resistance levels.

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