15/07/2019
IMPORTANT DISCLAIMER
The information of this report is of a general nature only. It is not a personal financial advice. It does not take into account your objectives, financial situation and personal needs.
a-Quant is not responsible for your actions and recommends you contact a licensed financial advisor before acting on any information contained in this general information report.
EURUSD
Although EURUSD fell below 1.12 as we had predicted, it had a serious increase last week, specially the last three days. Generally, EUR is weak and we’ll insist to our selling view this week too. There’s an important resistance at the area 1.1280 – 1.1300 so we’ll activate our selling positions at these levels with the area of 1.1210 as the main target. Fundamental factors that may increase volatility are the Euro-zone ZEW survey on Tuesday, the US Retail Sales Advance, the very important speech of Jerome Powel on Tuesday in Paris, the US Initial Job Claims on Thursday and the US Sentiment from University of Michigan on Friday.
GBPUSD
GBPUSD had a short-term trend reversal mid-week that lead the pair above 1.25 again, even close to 1.26 although there was a low at 1.2438. Our long-term view has not changed though. We’re looking for sell positions since we indicate that this short-term uptrend has come to an end. Our main target is 1.2450 but we won’t tolerate losses if the price moves above 1.2650. Important week for UK economy as there is the Rightmove House Prices announcement on Monday, the Jobless Claims Change on Tuesday, the Consumer Price Index on Wednesday, the Liabilities/Credit Conditions Surveys of Bank of England on Thursday and a series of announcements on Friday, including Public Finances, Central Government NCR, Public Sector Net Borrowing and PSNB Banking Groups.
USDJPY
We took the profit that we had set for our long positions at 108.70 (last week’s high was at 108.98) and then USDJPY moved down with momentum, closed to 107.90. We’re positive for this trend continuation and our short positions will have a main target at 107.20. Along with US fundamentals, pay special attention to the Japanese National Consumer Price Index on Friday as the rest of the week there are no news that may cause high volatility to the pair.
EURJPY
Last week had light bullish days until Friday where the instrument lost all the weekly profits until that day. Week closed almost at the same levels of its opening and this fact confirms the weak EUR behaviour. Our selling positions looking for a take profit at 121.15 but we will not tolerate losses if price exceeds 122.40.
EURGBP
EURGBP crossed over the price of 0.70 but not as much as we had set in order to go long. More specifically, last week’s high was at 0.9009. Our outlook has not changed, we’re still looking for 15-20 pips above 0.90 in order to open buy positions with target 0.9060 and 0.9090 but the most loss to suffer won’t be below the price of 0.8955. As we said above at GBPUSD area, week is full of news for UK so we need to be very careful with the risk management.
USDCAD
USDCAD had a bullish pullback which had mainly a reaction of strong USD movement at the 1st week of the current month but very quickly it returned back to its main downtrend. Our main target of 1.29 still remains and we’ll set our Stop Loss at 1.3140. Along with US news that we’ve already mentioned above, there are some news for the Canadian economy and the most important are the Consumer Price Index on Wednesday and the Retail Sales on Friday.
USDCHF
USDCHF couldn’t reach the 1:1 last week and it moved down due to USD weakness. Our Machine Learning models still pointing up but a short-term makes us sceptical and so our long positions will have a small size. Main target is 0.9930 but we will close our positions if price falls below 0.9715. No important news for Swiss economy this week and that means that USD will be the dominator factor for the pair.
AUDUSD
Finally, AUDUSD moved up and broke 0.70 as we had successfully estimated. This break-out gives extra fuel and momentum to the instrument and we’re very positive for its bullish trend. Our buy positions will target the area of 0.7080 at the first place and maybe 0.7170 is the trend is strong enough. Pay special attention to Chinese GDP announcement on Monday, at RBA Minutes of July Policy Meeting on Tuesday, at Westpac Leading Index on Wednesday and of course at the Australian Unemployment Rate on Thursday. Since we expect high volatility our Stop Loss must be wide and we must also reduce the size of our positions.
SP500
We had some profits by taking small and opportunistic short trades on SP500 last week but since the Index broke the 3,000 points resistance we’re definitely long. Since these high levels are unprecedented, we’ll use a trailing stop for exiting our buy positions and in any case, we will exit if we see the Index significantly below 3,000 points again. We’re far from overbought levels so we don’t expect serious pullbacks shortly. Pay special attention on the speech of Jerome Powell on Tuesday because it seems it is the only fact that may change the trend for SP500 this week. Of course, we don’t screen out some unexpected events like tweets or fresh news about the Trade War.
DAX30
A very bearish week for DAX30 passed by and the Index lost about 1.5%. There are fundamental reasons that make us believe that things may get even worst so we’ll favour short positions this week. Our Technical and Machine Learning models agree with this approach. Our main target will be the area of 12,180 points but in case of an opposite bullish movement we’ll exit if price break 12,500 points.
FTSE100
FTSE100 had a bearish week which brought the Index at the levels of 7,500 points again. Our risk will be very small but we’ll favour short positions, targeting 7,390 points. If the Index will take uptrend direction again, we’ll exit at 7,630 points. Brexit and Boris Johnson of course may change the perception of the market unexpectedly at any time.
Gold
Gold had up and downs last week but overall, we didn’t have a remarkable trend or price change. Our view for hunting downtrend opportunities has not changed and our sell positions still targeting the area of $1,382. Since it’s very difficult for this commodity to exceed the price of $1.440 for technical and fundamental reasons, we believe that it’s time to risk more with our short positions.
US Oil
We took serious profits from our long positions on US Oil last week by closing them a few cents below $60. These levels seem to be difficult for the US Oil to keep and in combination with OPEC expectancies and the analysts that see deteriorating demand outlook, the Chinese economy and the fresh good news regarding the Trade War as well as the Middle East news where despite the UK raising of the shipping threat level, maybe there will be an outlet that will lead US Oil prices lower. Our main target for short positions is $57.50 and we’ll start worrying for a possible uptrend, above $61.