Weekly Market Commentary | 26-30.09

On Monday, investors will still be paying attention to the EUR and GBP currencies, which continue to crash against the USD. Later, ECB President Christine Lagarde is due to testify before the Committee on Economic and Monetary Affairs in Brussels.

Tuesday>

– US durable goods for August are on the agenda, seen falling sharply, likely undermining the USD

– US new home sales and consumer confidence indices will also be released, along with the housing price index

Wednesday>

– German consumer confidence for October expected to plunge to new lows

– US pending home sales for August seen dropping again

– Federal Reserve Chair Jerome Powell is due to deliver opening remarks in a pre-recorded video at the Community Banking Research Conference in St. Louis

Thursday>

– German inflation data is projected to continue rising to new records, likely printing 9.5 – 9.8% year-over-year for September

– US jobless claims and the final revision of the Q2 GDP

Friday>

– Chinese PMIs for September is likely moving the Antipodean currencies during the Asian session

– British GDP (revisions) for the second quarter

– German retail sales, seen plunging heavily for August

– EU inflation indices, with another rise predicted

– US Michigan consumer sentiment index

Throughout the week, several Fed, BoE, and ECB governors will regularly give speeches, potentially causing market volatility.

Setups for This Week:

EURUSD

Primary View:

The first day of the week just started and we already have huge moves on the main pair

The price managed to test the lower line of the channel down formation

The test is so far done with a hammer candle, which creates a chance for a bigger bullish bounce

Alternative View:

If the price breaks the lower line of the channel down formation, the sell signal will be amplified

GBPJPY

Primary View:

The weakness of the pound is the main story on the market right now

GBPJPY fell to an area around 148.6, which is a key long-term support

The price bounced off this level with a hammer candle on the weekly chart. That is optimistic but we still have 5 days for this candle to close…

Alternative View:

If the price breaks the green area, a major long-term sell signal will be triggered

SP500

Primary View:

SP500 starts this week with a test of the crucial horizontal support on the 3650

So far, we have a bounce and a hammer, which is promoting a bullish correction

Alternative View:

If the price breaks the green area, we will get a major sell signal