Australian CPI q/q – 29 July 11:30am
- Australian CPI is forecasted to decrease from 0.3% to -2.0%. This potential decline in inflation could be attributed to the spike in COVID-19 cases in Victoria and NSW. This indicates a movement away from the RBA’s target inflation rate of 2-3% meaning that in the short-term, there will be no interest rate changes.
U.S. Pending Home Sales m/m – 30 July 12:00am
- U.S. Pending Home Sales saw a 44.3% increase in May. It is forecasted to rise by 15.6% in June, indicating U.S. economic recovery from COVID-19 impacts.
U.S. Advance GDP q/q – 30 July 10:30pm
Previous advance GDP figures saw a 5.0% decrease and is forecasted to contract even further this quarter by 35.0%. As GDP is the broadest measure of economic activity and an indicator of economic strength, a worse than expected GDP q/q will weaken the USD.
Canada GDP m/m – 31 July 10:30pm
Previous figures show that the economy had contracted by 11.6% in the previous month and is expected to expand by 3.3% this month. If the actual GDP is better than the forecast, the CAD will strengthen.
GBPUSD – Bearish Outlook
The GBPUSD currency pair has reached the 1.27725 resistance level which was previously a support level before the huge drop in March. This level is also a fibonacci retracement level meaning that a pullback is highly likely to occur. The currency pair is also approaching overbought conditions according to the RSI.
EURUSD – Bullish
Overall the pair still remains bullish in the short term, but the weakening/lack of momentum in bullish indicators coupled with the growing insecurity in the global market which in turn is likely to provoke the USD’s safe haven qualities, create a bullish outlook for the pair in the short to medium term. Therefore, traders in this pair should be extra cautious in coming week, with long position being opened only after key resistance levels have been breached and stop losses set close below supports. However, traders also shouldn’t be too hasty to short as factors such as the continued usage of quantitative easing in the EU and possibility for more Covid-19 cases in America can attract bulls to the pair.