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Accendo’s Foreign Exchange Forecasts, Monday 25 July

Foreign exchange

Macro observations

It’s a cautiously optimistic return from a weekend in which a number of fatal attacks took place in Germany and one in the US. Economics-wise, we’re due a central bank update from the Bank of Japan which is likely to apply more of the same stimulus measures on Friday. More pressing will be the US Federal Reserve on Wednesday. No change in policy is expected, but markets will be eager to gauge the vocal tones of Fed officials.

Note Friday also sees the results of European bank stress tests which will be watched closely for any signs of weakness – particularly in the Italian banking system which has been in considerable trouble recently. Will they require re-capitalisation? Any inkling of a forthcoming ECB bailout would surely affect the strength of the Euro on underlying concerns about the health of the Eurozone.


 

Key data this week (Sign up here to get our daily live macro-calendar)

Monday 25 July

UK Economic Announcements
11:00    CBI Trends

Intl Economic Announcements
09:00    IFO Business Climate (DE)
15:30    Dallas Fed (US)

Tuesday 26 July

UK Economic Announcements
09:30    BBA Home Loans

Intl Economic Announcements
07:00    Import Prices (DE)
14:00     S&P/CS House Prices (US)
14:45     PMI Services (US)
15:00     CB Consumer Confidence, New Home Sales, Richmond Fed (US)

Wednesday 27 July

UK Economic Announcements
09:30    Prelim GDP, Index of Services
11:00    CBI Sales

Intl Economic Announcements
02:30    Industrial Profits, Consumer Confidence (CN)
07:00    GfK Consumer Climate (DE)
13:30    Durable Goods Orders (US)
15:00    Pending Home Sales (US)
19:00    Fed Policy Update (US)

Thursday 28 July

Int. Economic Announcements
07:00     Retail Sales (DE)
07:45     CPI (FR)
08:55     Unemployment Change (DE)
10:00     Confidence (EZ)
13:30     Unemployment Claims (US)

Friday 29 July

Int. Economic Announcements
00:00    BoJ Policy Update (JP)
06:30    GDP (FR)
07:00    Retail Sales (DE)
07:45    Consumer Spending (FR)
08:00    CPI, GDP (ES)
10:00    CPI, GDP, Unemployment (EZ)
13:30    GDP (US)
14:45    Chicago PMI (US)
15:00    Consumer Confidence (US)


 

GBP/USD (‘Cable’)

GBP/USD (daily)

GBPUSD daily (-)

Technicals

  • Cable back below 1.32
  • Technical indicatirs still in bear territory

 

GBP/EUR

GBP/EUR (daily)
GBPEUR daily (-)

Technicals

  • The pair is holding up above 1.18835 and the 20-day moving average
  • Stochastics making a bearish cross
  • Still in a 12-month falling channel

 

EUR/USD

EUR/USD (daily)

EURUSD daily (-)

Technicals

  • Stochastics now oversold
  • Potential resistance at the 20-day moving average
  • 17-month sideways channel still valid

 

For information on deliverable FX, including how you can save thousands on currency exchange, put in a call to our trading floor on 0203 051 7461. It’s all part of the service!

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This research is produced by Accendo Markets Limited. Research produced and disseminated by Accendo Markets is classified as non-independent research, and is therefore a marketing communication. This investment research has not been prepared in accordance with legal requirements designed to promote its independence and it is not subject to the prohibition on dealing ahead of the dissemination of investment research. This research does not constitute a personal recommendation or offer to enter into a transaction or an investment, and is produced and distributed for information purposes only.

Accendo Markets considers opinions and information contained within the research to be valid when published, and gives no warranty as to the investments referred to in this material. The income from the investments referred to may go down as well as up, and investors may realise losses on investments. The past performance of a particular investment is not necessarily a guide to its future performance. Prepared by Michael van Dulken, Head of Research

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