Market participants are likely to closely monitor currency strength and weakness following the release of economic indicators in the U.S.

Market participants are likely to closely monitor currency strength and weakness following the release of economic indicators in the U.S.

31.07.2024

In yesterday’s U.S. trading session, the Canadian dollar weakened against the yen. The CAD/JPY pair fell from 112.096 to 110.189, dropping to the -2σ level of the hourly Bollinger Bands. With the RSI on the 4-hour chart having fallen to 30 and the pair having already broken below the 200-day moving average support line on the daily chart, we should remain cautious of further weakness during U.S. trading hours.

European currencies weakened against the U.S. dollar, even though Germany’s July consumer price index, released yesterday, rose by 0.1 percentage points year-on-year to 2.3% from the previous month’s 2.2%.The EUR/USD pair fell from 1.0835 to 1.0797. It faced resistance at the 75-period moving average (MA) on the hourly chart. On the 4-hour chart, the pair has pulled back from the 20-period MA, and on the daily chart, it is seeking direction—whether to rebound or extend its decline—just below the 200-period simple moving average (SMA).

Today’s schedule includes Japan’s Industrial Production at 8:50, New Zealand’s ANZ Business Confidence at 10:00, Australia’s Q2 Consumer Price Index and Retail Sales at 10:30, Germany’s Import Price Index at 15:00, France’s Consumer Price Index and Producer Price Index at 15:45, and Turkey’s Trade Balance at 16:00,at 4:55 PM: Germany’s unemployment rate; at 6:00 PM: Eurozone’s Consumer Price Index; at 9:15 PM: U.S. ADP Employment Report; at 9:30 PM: Canada’s GDP; at 10:45 PM: U.S. Chicago PMI; at 3:00 AM: U.S. FOMC interest rate decision and statement; and at 3:30 AM: U.S. Federal Reserve Chair Powell’s press conference.We will carefully assess currency strength and weakness based on the release of these indicators during U.S. trading hours.