Alpesh Patel
InvestingBetter.com
General market theme
Price action in the majors picked up yesterday with all the instruments we monitor in our daily report illustrating fresh price swings and volatility. Like we mentioned in our previous reports, this week is filled with important news and reports and the money markets are bound to respond to that. Yesterday it was the release of the ZEW Survey that attracted investors’ attention and with the report printing stronger than expected the Euro and the Cable extended their rallies to the upside. Today the focus turns to the Pound as the employment data from the UK is scheduled to be released, even though investors will also key an eye on the US stock markets later in the day as it’s earnings season and risk sentiment is always affected from it.
Price action highlights
The Euro continued climbing to the upside yesterday on the back of the better than expected ZEW Survey and the continued weakness of the US Dollar. The ZEW confidence report showed that there is support behind the European currency at this time and the recent uptick in the global economies like China has helped on this front. The Euro went as high as 1.1380 yesterday before settling just above the 1.1350 area which appears as the short-term support for the time being. The focus will be on the UK and the US earnings today so we don’t expect too much price action on the Euro over the next 24 hours.
The Cable extended its recent rally higher and has climbed above the 1.4400 level while the US Dollar remains weak. It seems that traders are taking advantage of this situation and pushing the Pound to the upside even though the risk of a Brexit remains as strong as ever, today investors’ attention will focus on the employment data that is expected to print in a steady manner. However it might just be the case that investors will prefer to take their cue from the earnings announcements in the US so the price action on the back of the report might be limited.
Focus of the day
The Economic calendar today includes the release of the labor market data from the UK in the morning and with the Pound being under threat from a Brexit a strong release will ease investors’ concerns. Later in the day the US Home Sales is the only piece of US-related data on the docket while as we mentioned above it’s earnings season in the US and we need to keep an eye on the news for that as well.
Economic Calendar
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