Markets kept showing huge volatility level on Trump’s trade wars while EUR/USD got extra buyers due to the mix of the dovish ECB decisions and the Non-Farm Payrolls data as well. US retail sales, consumer confidence, and inflation are expected in the second week of June.
The relations between the US and China kept being worse. They have been blaming the failure of trade talks on each other, limiting the operations of companies from the other country, and threatening additional sanctions. The atmosphere weighed on markets and added to concerns about a global recession. The odds of a rate cut from the Fed have risen.
This week is going to be really important for the main currencies like US dollar, Aussie, Cable, and Swiss Franc.
There are unemployment rate and average earnings data in UK will be published by National statistics tomorrow at 8:30. Last month’s employment numbers were mixed — a surprising fall of the unemployment rate to 3.8% in March — a record. The upcoming data is for April. We will be able to see the GBP bouncing from 1,27 If the rate reaches 3,9% as the experts think. In these conditions, we recommend selling GBPUSD pair from 1,2650 by setting a Sell Stop.
The interest rate decision and monetary policy statement will be published on Thursday by the Swiss National Bank. We think positive developments in the safe-haven currency will allow bulls to test the 1 – 1.02 level in a medium short term. We are bullish in USDCHF.
The USD/JPY closed the week lower at the level 108.20, being locked in a tight range. However, it updated a low having broken the 108 level for the first time since last January.
The daily chart for the USD/JPY pair indicates that the main trend is still bearish, as the pair is trading below a bearish 20 DMA. Additionally, the Cayman indicator’s broken the overbought zone. It means the sellers have the stronger hand. Shorter term, and according to the 4 hours chart, the technical look is also bearish, as the pair bounced after testing of the 48.2% Fibo level of its latest decline at 108.65
To sum up, here are our targets for:
GBPUSD – sell up to 1,25 by setting a Sell Stop from 1,2650
USDCHF – buy up to 1 – 1,02 in a medium short term
USDJPY – sell up to 107,80