EUR/USD what to expect ahead post upbeat U.S. jobs report?
Updated
1- FED monetary policy updates >>
- FED Richard Clarida said the central bank was on track to begin interest rate hikes in 2023, with a possible taper announcement later this year -
- U.S. NFP and unemployment rate reports marked another step toward the FED's goal of "substantial" progress in the labor market and raised expectations the central bank will start easing up on stimulus -
(ANY SOONER ADVANCE NOTICE OF TAPER MEANS SOONER LESS PRINTING USD, AND EARLIER THAN ANTICIPATED HAWKISH FED, WHICH IS USD POSITIVE)
2- ECB monetary policy updates >>
- There is no rush to signal the future of its pandemic bond buying according to Governing Council member Martins Kazaks. With almost 600 billion euros left to spend and the program running at least through the end of March, he says it would be much too early for a decision on whether to extend or phase out purchases -
(MEANS EXTENDED BOND BUYING, LONGER DOVISH, EUR NEGATIVE)
3- EU inflation updates >>
- German inflation jumped to the highest level since 2008 as coronavirus restrictions were lifted and economy reopened -
- According to calendar release the CPI (YoY)(Jul) signaled a rise to 2.2% from 2% forecasted and 1.9% previous - ( INFLATION INDICATOR)
- RISING INFLATION -
4- U.S. inflation updates >>
- According to calendar release the Core PCE Price Index (MoM) (Jun) has dropped to 0.4% signaling a modest drop in the U.S. inflation -
- PRETTY HIGH BUT DESCENDING INFLATION -
5 - Coronavirus updates >>
- In the U.S. there are increasing signs that the more easily transmitted delta variant may slow the pace of the U.S. economic recovery -
- 150,000 confirmed cases on Aug. 3 , the lagging indicator of death is beginning to rise too -
- U.S. COVID-19 CASES REACH SIX-MONTH HIGH EVEN AS VACCINATIONS RISE -
CONCLUSION
- THE SHORT TERM PRICE RANGE IS 1.1810-1.1700 -
- THE LONG TERM PRICE RANGE IS 1.1850-1.1650 -
- IF PRICE DOES NOT HAPPEN TO BREAK BELOW 1.1750 WOULD BE DUE TO RISING COVID-19 CASES HOWEVER IT STILL HAS NO SEGNIFICANT IMPACT ON THE ECONOMIC RECOVERY YET -
- BUYING OPPORTUNITIES ARE LOCATED AT THE RANGE OF 1.1745 - 1.1710 - CONSIDERING IF TO BUY ABOVE 1.1750 THEN TO BE USING THE LOWEST RISK -
- ANY BREAK BELOW 1.1750 WOULD BE SHORT LIVED TILL THE NEXT INFLATION AND MONETARY POLICY UPDATES -
- THIS OUTLOOK REMAINS ONLY TILL UPCOMING NEWS AND DATA THAT MAY CHANGE THE PRICE RANGE, SO I WILL UPDATE ACCORDINGLY -
- FED Richard Clarida said the central bank was on track to begin interest rate hikes in 2023, with a possible taper announcement later this year -
- U.S. NFP and unemployment rate reports marked another step toward the FED's goal of "substantial" progress in the labor market and raised expectations the central bank will start easing up on stimulus -
(ANY SOONER ADVANCE NOTICE OF TAPER MEANS SOONER LESS PRINTING USD, AND EARLIER THAN ANTICIPATED HAWKISH FED, WHICH IS USD POSITIVE)
2- ECB monetary policy updates >>
- There is no rush to signal the future of its pandemic bond buying according to Governing Council member Martins Kazaks. With almost 600 billion euros left to spend and the program running at least through the end of March, he says it would be much too early for a decision on whether to extend or phase out purchases -
(MEANS EXTENDED BOND BUYING, LONGER DOVISH, EUR NEGATIVE)
3- EU inflation updates >>
- German inflation jumped to the highest level since 2008 as coronavirus restrictions were lifted and economy reopened -
- According to calendar release the CPI (YoY)(Jul) signaled a rise to 2.2% from 2% forecasted and 1.9% previous - ( INFLATION INDICATOR)
- RISING INFLATION -
4- U.S. inflation updates >>
- According to calendar release the Core PCE Price Index (MoM) (Jun) has dropped to 0.4% signaling a modest drop in the U.S. inflation -
- PRETTY HIGH BUT DESCENDING INFLATION -
5 - Coronavirus updates >>
- In the U.S. there are increasing signs that the more easily transmitted delta variant may slow the pace of the U.S. economic recovery -
- 150,000 confirmed cases on Aug. 3 , the lagging indicator of death is beginning to rise too -
- U.S. COVID-19 CASES REACH SIX-MONTH HIGH EVEN AS VACCINATIONS RISE -
CONCLUSION
- THE SHORT TERM PRICE RANGE IS 1.1810-1.1700 -
- THE LONG TERM PRICE RANGE IS 1.1850-1.1650 -
- IF PRICE DOES NOT HAPPEN TO BREAK BELOW 1.1750 WOULD BE DUE TO RISING COVID-19 CASES HOWEVER IT STILL HAS NO SEGNIFICANT IMPACT ON THE ECONOMIC RECOVERY YET -
- BUYING OPPORTUNITIES ARE LOCATED AT THE RANGE OF 1.1745 - 1.1710 - CONSIDERING IF TO BUY ABOVE 1.1750 THEN TO BE USING THE LOWEST RISK -
- ANY BREAK BELOW 1.1750 WOULD BE SHORT LIVED TILL THE NEXT INFLATION AND MONETARY POLICY UPDATES -
- THIS OUTLOOK REMAINS ONLY TILL UPCOMING NEWS AND DATA THAT MAY CHANGE THE PRICE RANGE, SO I WILL UPDATE ACCORDINGLY -
Note
The U.S. JOLTs job openings (Jun) report happened to be upbeat to add to the progress of reaching the fed's employment goal, the price is hovering over the average of the short term price range of 1.1700-1.1800 with higher probability to test the 1.1704 (28th March low).BEST BUYING OPPORTUNITY 1.1710-1.1700. I DONT RECOMMEND TO SELL BECAUSE AS LONG AS THERE IS NO OFFICIAL TAPER ANNOUNCEMENT BEARISH INVESTORS COULD PROBABLY STILL FACE HURDLES TO BREAK BELOW 1.1750 however the downtrend if to continue would stop at 1.1700.
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