FX Market Update Hot Topics:
- U.S. CB Consumer Confidence in May Slightly Below the Analysts’ Expectations.
- RBA Board Member says “who cares what’s happening to house prices.”
- The indices sell-off continues, supported by the Italian crisis.
U.S. CB Consumer Confidence in May Slightly Below the Analysts’ Expectations.
The consumer confidence drops slightly below the analysts’ consensus at 128 pts versus the 128.2 expected. However, the confidence level in April was corrected down from 128.7 to 125.6 pts. Despite this correction, the U.S. Consumer Confidence keeps in the highest levels since 2001.fx
EURUSD accelerated its drops to the critical zone of the bearish cycle. The common currency falls for the seventh consecutive week breaking down the November 2017 support at 1.15539. For the coming sessions, we expect a limited fall to 1.14483 and then a recovery in three waves which could see the 1.197 level in the long-term. In the short-term, we update the invalidation level of the bearish cycle to 1.16317.
In the same way with EURUSD, GBPUSD continue its plunges for a seventh consecutive week dropping to the 38.2% Fibonacci level of the previous long-term cycle. We foresee new falls to the region between 1.31095 and 1.29357. Updated invalidation level is 1.33231. If price breaks above the break-down candle, we will consider changing the bias from bearish to bullish.
The Swiss currency is moving sideways expecting more volatility for the Greenback. We continue seeing more drops for this pair to the zone between 0.9815 to 0.9783 levels. The new invalidation level is 0.99831. The break-down candle signals more declines in the short-term.
RBA Board Member says “who cares what’s happening to house prices.”
The RBA’s Board Member Ian Harper said to the Wall Street Journal that “the bank will raise their interest rates when it has a basis for doing that because inflation is starting to pick up.” Member Harper added, “when all that starts to line up who cares what’s happening to house prices.” Harper continued that the RBA target “doesn’t target house prices.”
EURAUD. As the scenario expected, the price fell under the control level; now we expect a limited drop to the area between 1.5307 to 1.5195 levels, from where the price could start to bounce. Invalidation level is 1.54554.
GBPAUD is bouncing in the Potential Reversal Zone, 1.76773 to 1.75597, from where we foresee a bullish move to 1.78995. Invalidation level is on 1.77451. In the short-term, RSI shows signals of change in the trend bias from bearish to bullish.
The indices sell-off continues, supported by the Italian crisis.
FX Market Update: This Tuesday, the FTSE has continued the sell-off started last Wednesday 23rd, and the price consolidates below the invalidation level at 7,750 pts proposed in previous updates. The impulsive bearish move could stop briefly at 7,570 pts and make a bounce. The new invalidation level for the short-term is 7,803.5 pts, and the main bias keeps on the bearish side.
In the same context, DAX 30 opened with a bearish gap, testing the mid-term support on 12,659.1 pts. Considering the bearish gap context, it is probable that the German index in the short-term makes a Dead Cat Bounce Pattern, watching the 12,000 pts as a target. Invalidation level is updated and established at 13,040.6 pts.
