Trading plan for 06/06/2017:
The rate of AUD/USD increased slightly overnight after the Reserve Bank of Australia announced a positive interest rate decision and statement. The USD/JPY pair fell below 110.00 amid the mixed mood on Asian Stock Exchanges. Crude Oil is trading 0.5% down and its price again has to struggle from falling under $47. Gold has settled up at $ 1,285 an ounce on the weak Dollar.
On Tuesday 6th of June, the economic calendar is very light in economic data. Nevertheless, global investors will pay attention to Sentix Investor Confidence and Retail Sales from the euro area, JOLTs Job Openings data from the US, and Ivey Purchasing Managers Index data from Canada.
EUR/USD analysis for 06/06/2017:
The Sentix Investor Confidence and Retail Sales data are scheduled for release at 08:30 am GMT and 09:00 am GMR respectively. Market participants expect investor confidence to remain virtually unchanged at the level of 27.6 points as investors cheer the rebound in economic activity this year. Moreover, the estimates of the GDP for the second quarter is also assumed to beat expectations. The PMI's data released yesterday and last week were all at least in line with expectations, so they added to mounting evidence that the eurozone is enjoying a strong second quarter, consistent with GDP rising at a 0.7% rate. Reatil sales, however, are expected to tick lower from 0.3% to 0.2% for the reported month, nevertheless, they expected figures still support the view that economic activity is picking up. If today's figures for sales and sentiment match or beat the expectations, the news will provide new evidence that the broad rebound for the euro area's economy is improving and might even accelerate at the end of the year. Overall positive sentiment might spill to the EUR/USD pair and other Euro-related currencies, giving them a boost up.
Let's now take a look at the EUR/USD technical picture on the H1 time frame. The price is still trading around the recent local swing highs, just below the level of 1.1298. The most important intraday level is the technical support just above the 50%Fibo at the level of 1.1201. Any breakout lower might trigger a deeper decline towards the level of 1.1176 and then 1.1108. This scenario will be probable if the news is worse than expected.
Market Snapshot: Crude Oil still under the trend line
The price of Crude Oil tried to break out above the technical resistance zone between the levels of $48.24 - 47.80, but it failed and came back below the navy trend line. The bears are eyeing the technical support at the level of $46.73. If they managed to break out below it, then the next target would be at the level of $45.55. This scenario is supported by the fact that the momentum indicator can not break out above its fifty level despite the oversold market conditions.
Market Snapshot: Gold bullish breakout
The price of Gold has managed to break out above the 78%Fibo retracement and now is trading around the recent highs at the level of $1,295. Just above this level, there is a strong resistance zone that would be a current target for bulls. The next support will now be the zone between the levels of $1,258 - 1,274, that used to be resistance. Please notice the bearish divergence is starting to form between the price and the momentum indicator.
