Source: PaxForex Premium Analytics Portal, Fundamental Insight
The German Wholesale Price Index for August decreased by 0.8% monthly and by 1.1% annualized. Forex traders can compare this to the German Wholesale Price Index for July, which rose by 0.3% monthly and contracted by 0.1% annualized.
The final Spanish CPI for August is predicted to be flat at 0.0% monthly and increase by 2.2% annualized. Forex traders can compare this to the Spanish CPI for July, which decreased by 0.5% monthly and expanded by 2.8% annualized. The Final Spanish Harmonized Spanish CPI for August is predicted to be flat at 0.0% monthly and rise by 2.4% annualized. Forex traders can compare this to the Spanish Harmonized CPI for July, which dropped by 0.7% monthly and accelerated by 2.9% annualized.
The ECB is predicted to cut its Interest Rate from 4.25% to 3.65% and its Deposit Facility Rate from 3.75% to 3.50%. Traders should wait for the press conference thirty minutes after the announcement for an assessment of future monetary policy. A smaller interest rate cut could rally the Euro.
US Initial Jobless Claims for the week of September 2nd are predicted at 227K, and US Continuing Claims for the week of August 26th at 1,850K. Forex traders can compare this to US Initial Jobless Claims for the week of August 26th, reported at 227K, and US Continuing Claims for the week of August 19th, reported at 1,838K.
The US PPI for August is predicted to rise by 0.1% monthly and by 1.8% annualized. Forex traders can compare this to the US PPI for July, which accelerated by 0.1% monthly and 2.2% annualized. The US Core PPI for August is predicted to expand by 0.2% monthly and by 2.5% annualized. Forex traders can compare this to the US Core PPI for July, which was flat at 0.0% monthly and rose by 2.4% annualized.
US Natural Gas Inventories for the week ending August 6th are predicted to increase by 49B cubic feet. Traders can compare this to US Natural Gas Inventories for the week ending August 30th, which rose by 13B cubic feet.
The US Monthly Budget Statement for August is predicted at -$285.7B. Forex traders can compare this to the US Monthly Budget Statement for July, reported at -$244.0B.
The forecast for the EUR/USD is cautiously bullish after this currency pair corrected into its horizontal support area. Price action trades below its flat Tenkan-sen and Kijun-sen, but downside pressure has faded. The flat Senkou Span A and Senkou Span B of the Ichimoku Kinko Hyo Cloud confirm the absence of bearishness as traders await the ECB interest rate decision, where markets priced a jumbo interest rate cut. Traders should also monitor the CCI in extreme oversold territory, where it recorded a higher low. A breakout above -100 could trigger the next leg higher. Can bulls regain control over the EUR/USD and force price action into its horizontal resistance area and a new 2024 high? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the EUR/USD remain inside the or breakout above the 1.1000 to 1.1040 zone, PaxForex recommends the following trade setup:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.1020
- Take Profit Zone: 1.1155 – 1.1200
- Stop Loss Level: 1.0965
Should price action for the EUR/USD break down below 1.1000, PaxForex recommends the following trade setup:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.0965
- Take Profit Zone: 1.0850 – 1.0910
- Stop Loss Level: 1.1000
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