After the drop on Wednesday, the dollar pushed back in trading yesterday as it gained decent ground to be up on the week now. EUR/USD fell back below 1.0900 while GBP/USD saw a stronger rejection at the 1.3000 mark. Meanwhile, USD/JPY also rebounded back above 157.00 and is up over 200 pips from the lows in Asia trading yesterday.
It’s quite a mix of flows but the dollar did rebound alongside yields at least. As for equities, the selling continued in US trading with stocks ending in the red despite a late bounce. It is a poor week for tech shares in particular but overall, the S&P 500 and Nasdaq are still both up in July trading.
The same bout of flows will once again be the key drivers of trading sentiment today. And with the dollar fighting back, we are starting to see some changes in near-term charts as well.
EUR/USD and GBP/USD are both now trading in between their 100 and 200-hour moving averages, establishing a more neutral near-term bias. So, there’s that. But the dollar move to end the week will also ride on how bond yields fare, with little other catalysts to work with.
Then, we’ll have to watch out for the risk mood again when we get to US trading. That is to see if stocks will continue to be pressured lower for a third day running or not.
As for European trading today, there won’t be much with UK retail sales being the highlight. The estimates show that retail sales should fall back in June, after the better showing in May. The softer consumption activity among UK households is evidence of inflation still biting at the economy but luckily for the BOE, things have been holding up better in Q1 at least.
0600 GMT – Germany June PPI figures0600 GMT – UK June retail sales data0800 GMT – Eurozone May current account balance
That’s all for the session ahead. I wish you all the best of days to come and good luck with your trading! Stay safe out there.
This article was written by Justin Low at www.forexlive.com.
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