Forex Daily Recap – DXY Slipped over Weak US June Trade Balance
Today, the Greenback completely breached the 98.32 resistance-turned-support line which was restricting the downside. Even if the US Dollar Index had dropped more sharply then the below lying strong support confluence could have got activated. This confluence consisted of the significant SMAs and a more-than-a-month old slanting support line.
Anyhow, today, the Greenback bears gained strength over a negative Trade Balance data release ignoring positive July Earnings report. Notably, the July YoY Average Hourly Earnings recorded 0.1% higher than the street hopes of around 3.1%. Meantime, the July Unemployment Rate continued to remain at 3.7%, the same as the last time. Somehow, the market attention remained glued towards Trade Balance data that came near $-55.2 billion over $-54.6 billion forecasts. Also, the June Michigan Consumer Sentiment Index reported 0.1% below estimates.
Fiber continued to remain underway recovery today after suffering a massive plunge on July 31. Quite noticeably, the falling major rival, USD Index, bestowed the pair’s positive moves. Meanwhile, higher-than-expected June YoY Eurozone Retail Sales surprised the market participants. The Retail Sales figure came around 2.6% over 1.3% forecasts. Also, the Italian June Retail Sales statistics recorded above the market estimations. Anyhow, the EUR/USD pair seemed to shrug over a few low volatile downbeat data releases.
The July Spanish Unemployment Change published a higher figure this time. The market had hoped the data to record near -21.4K over the prior -63.8K. However, the actual reports came near -4.3K, shocking the Fiber traders. At around 16:34 GMT, the Fiber was struggling to break and move above 1.1110 resistance handle in order to justify a 15-day old slanting descending support line.
After ten negative trading sessions in a row, today, the Aussie pair attempted to display some positive drifts. Earlier the day, few upbeat AUD-specific events came out pleasing the buyers. The June MoM Retail Sales recorded 0.4% over the market hopes of around 0.3%. Also, the Producer Price Index reported above the consensus estimates.
Needless to say, the Relative Strength Index (RSI) was still stuck at the bottom near 28.12 levels, signaling a weak buyer’s interest. And, even the red histograms of the MACD pointed to the south, discouraging the bears. On the upper side, the pair would have confronted significant Simple Moving Averages (SMA). If the AUD/USD pair had moved further south-side, then that would have enabled fresh challenge to the stable 0.6745 support handle.
The Swiss Franc pair had maintained a strong downtrend since the last two months, remaining capped by a healthy slanting descending support line. Somehow, the pair came out of the tumbling rally at the start of July. From there, even today, the USD/CHF pair remained intact within a 0.9808/0.9944 range level.
After opening near 0.9900 psychological mark, the USD/CHF pair kept heading southwards throughout the day. The market had expected sharp pullbacks in the near term as the 50-day SMA had already crossed below the significant 200-day SMA. Meantime, the Switzerland economic docket showcased disappointing data releases. The market analysts had expected the July Swiss YoY Consumer Price Index ( CPI ) to report near 0.5% as compared to the previous 0.6%. Nevertheless, the CPI data came around 0.3%, even below the consensus estimates.
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