Analysis by: Pepperstone
U.S. Dollar. Our bias BULLISH, we’ll be looking to buy on dips.
• U.S. Dollar Index closed relatively unchanged last week against its major counterparts
• U.S. CPI due Friday
• After registering a record low at 9.323, the U.S. Dollar Index has rallied in 5 waves
• Implications are bearish early this week, followed by the next bull leg higher
• We remain bullish U.S Dollar in the week ahead
Euro. Our bias BEARISH, we’ll be looking to sell on rallies.
• Euro range bound against U.S. Dollar for most of last week
• Euro-zone banking concerns now the focus of investors
• German, Spanish, Portuguese and Euro-zone GDP figures due this week
• Expectations are for EURUSD to break its range-bound price action soon
• We remain Euro bearish as safe-haven plays look to be the likely near-term scenario.
Japanese Yen. Our bias NEUTRAL, on the sidelines till a clearer picture develops.
• Yen traders are poised to act should Japanese officials intervene in the market while USDJPY continues to trade near record lows by 76.28 levels
• In the absence of central bank moves this week, USDJPY will likely push lower, especially if market participants continue to diversify away from the U.S. Dollar
• Recent sideways price action likely composes a 4th wave.with a break lower would shifting focus to 72.60 (161.8% extension of initial decline from the April high)
• We remain Yen neutral in the week ahead
British Pound. Our bias BEARISH, we’ll be looking to sell on rallies.
• CPI, employment, MPC meeting minutes & retail sales data due this week
• Expected BoE dovish outlook could weigh on Sterling in the near future
• GBPUSD has reversed from the 50% retracement at 1.6126
• Rallies to 1.6335-1.6400 levels would provide GBPUSD selling opportunities
• We maintain a bearish Sterling bias in the week ahead
Canadian Dollar. Our bias BEARISH, we’ll be looking to sell on rallies.
• Canadian CPI report due Friday
• Expected risk aversion pressures likely to weigh on the Loonie in the week ahead.
• Key support is at 0.9850/0.9740 levels and dips to here would provide opportunities to establish long positions
• We maintain a bearish Loonie bias in the week ahead
Australian Dollar. Our bias BEARISH, we’ll be looking to sell on rallies.
• Last week, the Australian Dollar whip-sawed in a 500 pip range as the sharp global sell-off saw investors jettison risk currencies in favour of safe-haven plays
• RBA policy meeting minutes due on Tuesday
• AUDUSD’s decline from the 27th July high at 1.1079 is an impulse and expectations are for a drop to below 0.9930 levels before a more substantial recovery
• Failed rallies to 1.0360-1.0630 levels would provide selling opportunities
• We maintain a bearish Aussie bias in the week ahead
New Zealand Dollar. Our bias BEARISH, we’ll be looking to sell on rallies.
• Quiet economic calendar for the Kiwi this week
• Expectations are for a drop to at least 0.7971-0.7868 levels before a larger advance
• Rallies to 0.8405-0.8508 levels would provide selling opportunities
• We maintain a bearish Kiwi bias in the week ahead