Today, we will report about the data around the Euro-Zone and the expectations based on surveys about the policy meeting of the ECB today. We wish you a nice Thursday and good luck in trading after reading our report.
Market review
The EUR has reached its lowest level since July 15th against the JPY, before a European report, which is expected to show that retail sales fell in July from a year ago. This could add to signs that the economic recovery inside the Euro-Zone is going slow. Today, there will be a policy meeting of the ECB and a lot of investors speculate that President Jean-Claude Trichet may signal the central bank will keep interest rates low. The EUR also fell against the CHF. It reached a rate close to a seven-week low while the report is likely to show retail sales fell 2.2 percent in July from a year earlier, after a 2.0 percent drop in June, according to a survey. Yesterday, the EUR/JPY fell for a seventh day in a raw after touching a low at 131.04, which was the lowest since July 15th. Today the pair recovered a bid and trades currently around 131.70. Yesterday the European currency reached its cheapest level since July 13th against the CHF, after it touched a low at 1.5125.
The JPY climbed for a ninth day versus the GBP as the Nikkei 225 stock Average declined 0.4 percent, adding to yesterday’s 2.4 percent fall. The GBPJPY touched a low of 149.05 after opening at 150.18 yesterday. It was the lowest price since July 13th.
GBP/CAD
Since the end of May, the GBP has been trading falling along a bearish trend line against the CAD. After it touched the 0.0% (1.7616) support of the Fibonacci retracement lines for the third time, it pulled back and reached the 23.6% (1.8016) Fibonacci and the downward trend line. Due to these two resistances we could expect a return to the 0.0% support level at 1.7616.
USD/CAD
During August and September, the USD/CAD has been trading in a bullish trend. At the end of August, the market started to move in an upward trend channel. As you can see, the market has reached the upper line of the channel, the upper Bollinger band and the resistance line around 1.1080. These three levels could be a sign for an overbought market.
