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Too Much To Handle?

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Macroeconomic Outlook


Ahead there is a complex week full of powerful references

–          Apart from the fact that we start from an inconclusive G7

o   More like a G6 + 1

Regarding the references and what needs to be considered

–          Central Banks

o   Fed will raise rates this week to 2% (already discounted)

  • And how many more increases there will be this year
  • Probably one more but open to speculation

o   ECB

  • When will it finish its asset purchase program?

o   Issue of Italian debt

o   Extremely important

  • It will condition what ECB will do

o   Bank of Japan

  • Will repeat with -0.1%

–          Prices

o   Industrial Prices in USA

  • Increase to 2.9 from 2.6

o   European Inflation

  • Remain at 1.9

–          USA – North Korea Meeting

o   Just speculation and news

Bearing in mind all this, it is going to be a hard week, and the best position is to wait on the sidelines to see what the outcome is of all these events and then consider a more clear position.

 


Technical Analysis


US Dollar Index


It is in a danger zone between two monthly bearish trends. Possible rebound from the support one on its way. In the next days, it will clear and show whether it confirms the bounce and breaks the resistance above it or if it is just testing and continuing the monthly bearish trend.


EURUSD


Undecisive, presently, going sideways. For now, we remain bearish as long as it remains below the monthly resistance which it is approaching now. In case it approaches it, we´ll see whether it is just a retest or a breakout creating a bullish trend.


GBPUSD


After breaking out the two resistances, it confirms the creation of a new bullish trend. Hence, we open a new long position looking for a long trend after breaking through the resistances and retesting them afterwards.


USDJPY


As explained in the previous weeks. USDJPY has been and will be going sideways without a clear direction. However, the sideways space is narrowing, and soon, it will be forced to take a side, whether long or short. For now, we wait while the resistances and support get closer to each other.


DAX


It could not close above the resistance we based in our long position. So, this week it will be key to know whether it can close above at some point, eliminating all the fears of a possible bearish trend. In case it does not close above and confirms the retest we will close the position and open a bearish one.


Crude Oil


After breaking the bullish resistance it was holding on to, it is now retesting it. This retest confirms the continuation of the recent bearish trend. For now, we remain bearish.

 

 

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