Canadian Inflation and retail sales numbers on Friday could fuel expectations of a rate hike if they point to strong readings. Inflation in Canada has been higher in recent months and rose to 2.3% in March.
Economic CPI forecast to reach 0.3% with core retail sales to be 0.5%.
However, Negotiations about the North American Free Trade Agreement (NAFTA) have reached a dilemma with no meetings scheduled among the top leaders, ahead of the month-end.
Trump’s economic adviser Kudlow linked between NAFTA and China, indicating that an agreement on NAFTA would show that the US can avoid a trade conflict with China. The NAFTA agreement would also show Trump’s tactics, and if there is trade conflict with China, then it is China’s fault.
On the other side, inflation fell faster than the BoE forecasted in February.
Policymakers think the effects of sterling’s Brexit are likely to ease a slightly faster than expected, so they now plan that inflation will return to the 2 percent target in two years, despite the delay of the next rate rise.
The Australian Employment Change for April was better than expected with 22.6K, which crossed over the 19.8K estimate.
On the other hand, the Unemployment Rate rose for the fifth time since July 2017, reaching 5.6%.
On the daily chart, the price had a false break beneath the support zone 0.75-0.7535. That enhances the harmonic pattern AB=CD. The pair had made a price action (pin bar) in this false break to boost the bullish bias. The pair is moving onto the support zone now. Along with divergence in RSI and breaking the lower trend line as shown, the price is ready for the next move up to 0.7635 then 0.7715.
On the daily chart, the price had made its way into the resistance zone of 1.2925-1.3, with an approach from the descending trend line starting from the high of 2015. The price reversed from these levels, breaking beneath the key 1.28 support level and returning to it. If the daily candle closes under this level again, it will prompt the price to be bearish to the support zone 1.252-1.243.
On the daily chart, we can see that the price bounced from the support area of 80.35-81.2.
A well-noticed head & shoulders reversal pattern is shaped. The price is on the second shoulder with a breaking of the lower trend line as shown.
Followed by oversold on RSI and the breaking of the lower trend line, the price is expected to get back up again to the resistance area 84-84.35.