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Monday, August 14th
The EUR/USD pair corrects lower at the start of this week after strong upside rally, backed by weaker-than-expected the US CPI data, breaking through the support level of 1.1800. Seems that the market has passed over recent disappointment from the US economy, allowing the US dollar to recover part of its Friday’s losses against its main competitors. Moreover, improving risk appetite, underpinned by easing geopolitical tensions between the US and North Korea, also leaves the pair without any support on Monday. With no any relevant data reports from both economic calendars, the pair will continue to trace global market trend throughout this Monday, while investors are starting to prepare for the ECB and FOMC minutes, which will be released later this week and will be able to shed some light on further monetary policy moves of the regulators.
The yen remains one of the weakest assets of this Monday, as strong risk-off trend cools off at the start of this week, forcing the pair to move away from its multimonth lows, posted on Friday. Seems that geopolitical tensions between the US and N.Korea have faded away after several calming speeches by US policymakers, thereby feeding investors’ interest for more risky assets, that in turn positively affects the USD/JPY pair today. Adding to this, the US dollar is showing signs of recovery, as the market has already digested Friday’s softer-than-expected US inflation figures, having forced Japanese bulls to shrug off upbeat Japan’s Q2 GDP report. Looking ahead, today we will have completely empty data calendar, so the pair will continue to follow the USD price dynamics and broad risk sentiments for the rest of this day.
The AUD/USD pair loses points at the beginning of this working week, failing to benefit from growing risk appetite. The US dollar has recovered a smile against its main competitors after Friday’s US CPI disappointment, forcing the pair to navigate in the north direction. Moreover, weak Chinese Industrial Production report, which was released in Asia, is also collaborating with pair’s retreat, as China is the biggest business partner of Australia. On the data front, nothing much is scheduled in the US data calendar for this Monday, leaving the pair at the mercy of global market sentiments, while RBA minutes, which will be released during the next Asian session, will be able to provide some directional impetus to the pair.
Bitcoin does not stop to surprise the market, extending its bullish rally and having refreshed its ultimate highs against its US competitor at 4174.60 mark. According to the latest coinmarketcap.com data, the capitalization of the cryptocurrency has stepped over 67 billion USD. The latest optimism of the asset is related mainly to renewed demand for bitcoin, backed by new hard fork implementation, which was designed to accelerate transactions between coin holders. Moreover, uncertainty around newly created Bitcoin Cash also underpins investor confidence in BTC, thus boosting BTC/USD pair’s bullish run.
The main events of the day:
Support and resistance levels for the major currency pairs:
EURUSD S. 1.1706 R. 1.1904
USDJPY S. 108.41 R. 109.77
GBPUSD S. 1.2900 R. 1.3084
USDCHF S. 0.9555 R. 0.9667
AUDUSD S. 0.7809 R. 0.7949
NZDUSD S. 0.7222 R. 0.7372
USDCAD S. 1.2593 R. 1.2795
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