EUR/GBP looks towards a slew of data with composite & service sector PMIs from both UK & Eurozone and Eurozone retail sales due. Gold extends gains above 50 sma ahead of US ISM services data & ADP employment numbers.
EUR/GBP looks towards a slew of data
EUR/GBP treads water heading into the European open with data in focus. The Pound found support in the previous session from the government scrapping the additions of more categories to its travel watchlists (FXE, FXB).
Today composite and services PMIs are in focus, these are final reading so are not expected to be as market moving as flash readings. The UK is expected to confirm a slow down in composite business activity to 57.7 in July as COVID cases rose.
The Eurozone composite PMI is expected to remain elevated at a 21 year high of 60.6, up from 59.5 in June.
Eurozone retail sales are expected to reveal a 1.7% MoM increase in June after a 4.6% rise in May as the economy reopened after the third COVID wave.
Where next for EUR/GBP?
The pair trades in a descending channel since mid April in an established bearish trend. The RSI is supportive of further losses in bearish territory.
A meaningful move below yesterday’s low of 0.8525 could bring 0.85 in focus the July low. Beyond there 0.8475 offers significant support as the lower band of the descending channel and the year to date low.
Any recovery could look to retake 0.8560 the weekly high, ahead of the 50 sma and upper band of the descending channel at 0.8575 & 0.8585 respectively. This could open the door to 0.8615 July 8 high.
Gold extends gains above 50 sma with US services PMI & ADP due
Gold (GLD) heads higher snapping a 3 day losing run, supported by a weaker US Dollar. However, caution dominates ahead of ISM services PMI data and ADP employment data.
Rising COVID cases in the US, after the CDC noted the largest jump in infections since February, adds pressure to USD, supporting Gold.
COVID cases in Japan, India & China are concerning boosting Gold’s safe haven appeal.
Where next for Gold?
Gold continues to extend beyond the 50 sma on the 4 hour chart. The receding bearish bias on the MACD in addition to the RSI gradually improving could suggest further gains towards 1825 high July 20.
Resistance at 18333/5, the double top formation could prove a tough nut to crack. A break higher here brings 1845 the June 14 low into focus.
On the downside support can be seen at 1809 the 50 sma and 1805 the ascending trendline. A move below 1792 the June 28 low could see sellers gain traction.
Comments
Log in or sign up to join the conversation.