The economic calendar is looking pretty busy with significant market driver news coming out. As we head into the first week of September, the U.S. Non-Farm Payrolls report will be released and cautiously eyed by investors. Fed Chairwoman Yellen said nothing new in her speech, she remained hawkish but without determining the time of the next rate hike.
On [B]Monday[/B], U.K. will be on a Summer bank holiday. Early in the morning, the German import price indexes for July will be released. No other significant news is scheduled for the Euro area. In U.S., the personal spending for July is expected to rise 0.3% compared to an increase of 0.4% the month before. On the other hand, the personal income is forecasted to increase 0.4% from 0.2% before. The personal consumption expenditures price index for July is also coming out, no forecasts are available yet. Later in the day, the Japanese unemployment rate for July, the retail sales as well as the household spending will be released. Overnight, the Australia Bureau of Statistics will publish its building permits for July.
On [B]Tuesday[/B], [B][/B]the U.K. mortgage approvals for July are coming out. In Eurozone, various indicators for confidence for August will be released. The consumer confidence is expected to slip further in the negative territory, -9 versus -7.9 before. The services sentiment is forecasted to have marginal a decrease at 11.0 from 11.1 while the industrial sentiment to have a drop at -3.0 from -2.4. No forecasts are available for the business climate. Afterwards, investors will keep a tab on German flash inflation rate for August. In U.S., the Case-Shiller home price indices for June are coming out as well as the final consumer confidence for August. Moreover, the U.K. Gfk consumer confidence for August. Later in the Asian session, the flash Japanese industrial production for July will be released and a while later the housing starts and construction orders also for July.
On [B]Wednesday [/B]morning, the U.K. nationwide housing prices for August are coming out. German retail sales for July and unemployment rate for August will be released as well. Afterwards, the attention turns to Eurozone, where the unemployment rate for July and the preliminary consumer price index for August are coming out. The unemployed to people are forecasted to be at 10.0% in July marginally lower of 10.1% have been before. The consumer prices are expected to show a slightly steeper increase than before at 0.3% compared to the year before, versus 0.2% the previous month according to the flash figure. Going to U.S., the ADP Employment Change for August will be closely eyed, two days ahead of the Non-Farm Payrolls report. The monthly change of the non-farm, private employment is estimated to be 165K versus 179K in July. The pending home sales for July will be released as well a couple of hours later.
On [B]Thursday[/B], the Markit Manufacturing PMIs for numerous countries including U.S., U.K., Germany, France and Eurozone as a whole will be published for August. Most of them are forecasted to keep the same pace as the first estimates. The U.K. manufacturing is expected to have an improvement to 49.1 from 48.2 before, however, it remained below 50, indicating contraction. In U.S., the weekly jobless claims will be released as usual. The ISM manufacturing is forecasted to slip at 52.4 in August from 52.6 before while the construction spending for July is estimated to rise 0.2% compares with a drop of 0.6% the month before.
[B]Friday [/B]is the Non-Farm Payrolls day! No economic indicators or speeches are scheduled in Europe during the morning, thus all the traders will wait for the U.S. job report on the second half of the trading session. The unemployment rate is expected to fall to 4.8% from 4.9% before and the forecasts suggest that the economy has added 164K jobs in April from 217K before. The Canadian imports and exports are also scheduled to be released.
[B]EUR/USD - Technical Analysis[/B]
The EUR/USD pair plummeted more than 1% during last week and created a negative week after two consecutive positive candles. This week the common currency is waiting for the NFP that is coming up on Friday and probably until then will have a weak price action.
From a technical point of view, the euro after peaking at 1.1365 on August 18th ended the week sharply lower against the U.S. dollar. The most traded currency had a failed attempt to surpass the 100-weekly SMA last week and the pair met the 1.1170 price level. Going to a lower timeframe, the currency closed below the 100-SMA and is currently trading near the 1.1200 psychological level. If there is a penetration of the 1.1150 support level, then the price will continue its downward move until the significant support area 1.1050 – 1.1070. On the other hand, if the price breaks the 1.1240 resistance level will open the way for a retest of the 1.1365 barrier. The MACD oscillator is falling but is still moving in a positive territory, while the RSI indicator is sloping upwards as it is approaching the 50 level.
[B]GBP/USD - Technical Outlook[/B]
The sterling is looking quite bearish against the dollar following the aggressive sell-off during last week’s session. Technically speaking, this enabled the GBP/USD pair to remain below the key significant level of 1.3280, as well as below the 38.2% Fibonacci retracement level.
The pair found support at the 1.3238 level, near the key support level of 1.3370, having broken below the key level during Friday’s session of 1.3200. This week’s data is likely to have a significant impact on the direction of the pair, including the U.S. Non-farm Payrolls for August. Having in mind the above, the 1.3065 – 1.3022 zone should provide a key insight into whether the market remains bearish or has turned bullish for the correction phase. On the 4-hour chart, technical indicators are retreating modestly from extreme overbought levels, while the 50-SMA stands horizontal around 1.3120. If the price falls below this last, the risk will turn back towards the downside, with scope to return closer to the aforementioned support zone.