EUR/USD consolidates near 1.1150, awaits EZ data
The shared currency swings between gains and losses versus the US dollar in the late-Asian trades, with EUR/USD keeping range near 1.1150 levels. The major is consolidating previous sharp moves against a back drop of China fx intervention and Sept Fed rate hike bets back on the table.. The EUR/USD pair trades almost unchanged at 1.1153, making lower highs on daily charts. The main currency pair continues to oscillate in a 20-pips narrow range as markets remain cautious ahead of a series of crucial macro data from the Euro zone including, German prelim GDP, bloc’s final GDP and CPI figures.
On Thursday, the euro currency incurred a marginal loss against the greenback, losing part of the powerful momentum which sharply drove the EUR/USD pair to a monthly high of 1.1213 on Wednesday as the USD bulls dominated across the board on slightly better retail sales data which further boosted expectations of Sept Fed rate hike. .
Asian stocks trade mixed, PBOC halts Yuan devaluation
Asian indices traded mixed on the last trading day of the week, as traders digest the latest PBOC price action in the currency markets, halting the yuan devaluation after three consecutive days of decline.
The USD/CNY rate was set 0.05% lower at 6.3975 for the first time in four days. China’s central bank created havoc in the markets this week, by the sudden yuan devaluation by PBOC on Tuesday had largely ended by Thursday as Chinese authorities came to the markets’ rescue and noted that the yuan devaluation process was completed and big fall in Yuan are unlikely. While on Friday, the central bank’s move is likely to bring a calm end to this rocky week.
Pound falls to 2-week lows vs. stronger dollar
The pound fell to two-week lows against the U.S. dollar on Tuesday, as expectations for a U.S. rate hike in the coming months continued to lend broad support to the greenback.
GBP/USD hit 1.5385 during European morning trade, the pair’s lowest since May 8; the pair subsequently consolidated at 1.5415, sliding 0.36%. Cable was likely to find support at 1.5241, the low of May 8 and resistance at 1.5591, the high of May 20. The dollar was boosted after Federal Reserve Chair Janet Yellen reiterated Friday that the bank still expects to start raising interest rates later in the year if the economy continues to improve as expected.
| Important events and their explanation: |
| Time ( IST) | Currency | Economic Data | Expectation | Previous |
| Tentative | EUR | Greek Gov Debt Crisis Vote | Pass | |
| 11:30am | EUR | German Prelim GDP q/q | 0.50% | 0.30% |
| 2:30pm | EUR | Final CPI y/y | 0.20% | 0.20% |
| EUR | Flash GDP q/q | 0.40% | 0.40% | |
| All Day | EUR | Eurogroup Meetings | ||
| 6:00pm | USD | PPI m/m | 0.10% | 0.40% |
| USD | Core PPI m/m | 0.10% | 0.30% | |
| 6:45pm | USD | Capacity Utilization Rate | 78.00% | 78.40% |
| USD | Industrial Production m/m | 0.30% | 0.30% | |
| 7:30pm | USD | Prelim UoM Consumer Sentiment | 93.5 | 93.1 |
Explanation:- Today is a very crucial day for the USD as we can witness some heavy weightage events like industrial production, Consumer sentiment, PPI . We assume all this events would come as per there expectations and would be favorable for the USD and negative for the commodities .
| Quick Glance :. |
| Instrument | Price | %Chg | Volume | OI |
| USD/INR | 65.15 | 0.17 | 788526 | 960103 |
| EUR/INR | 72,72 | -0.82 | 37048 | 48836 |
| GBP/INR | 101.76 | 0.07 | 21059 | 41217 |
| JPY/INR | 52,39 | -0.64 | 7908 | 15311 |
Technical touch
As seen pair has pierced its prolonged Ascending triangle and trading above crucial 64.50 levels. After a surprise move by the Chinese banks rupee depreciated and touched 64.80 levels. We assume rupee to form a minor resistance at 65.00 levels and minor appreciation till 64.50 levels. Once can go long with 64.90
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