Weekly Market Commentary | 21.08 – 28.08

Curious to know what’s happening on the markets this week? Take a quick tour of the latest news, economic updates, and trading setups that will keep you up-to-date and in the know.

• Monday:
  • A tranquil start to the week with no Tier 1 data scheduled.
• Tuesday:
  • US: Existing Home Sales and Richmond Manufacturing Index.
  • International focus on the first day of the BRICS countries summit.
• Wednesday:
  • New Zealand: Retail Sales kick off the day.
  • PMI Day: Manufacturing and Services PMIs from leading global economies:
    • Eurozone: Both Manufacturing and Services PMIs.
    • UK: Both Manufacturing and Services PMIs.
    • US: Both Manufacturing and Services PMIs. (Note: Generally, services PMIs are expected above 50 while manufacturing PMIs are expected below 50.)
  • Canada: Retail Sales Data.
• Thursday:
  • US: Unemployment Claims and Durable Goods Orders.
  • Globally, the spotlight turns to the first day of the Jackson Hole symposium.
• Friday:
  • Japan: Inflation from Tokyo to start the day, with an expected rate of 2.9%, a drop from the previously expected 3%.
  • Germany: IFO Business Climate, anticipated to be at 86.8.
  • US: Revised University of Michigan Consumer Sentiment, predicted at 71.2.
  • Additionally, key speeches are on the agenda with remarks from prominent central bankers including Jerome Powell (Fed Chair) and Christine Lagarde (ECB President).

Setups for This Week:

USDCHF

• Primary View:
  • The price last week broke through the midterm downtrend line, which is marked in purple, leading to a buy signal.
  • Still, the currency pair remains beneath the initial horizontal resistance at 0.883, highlighted in yellow.
  • A breakout above this yellow resistance could pave the way for buying opportunities, with an aim toward the green resistance situated at 0.9.
• Alternative View:
  • If the price recoils off the yellow resistance, diving back beneath the trend line, it would emanate a compelling sell signal.

2. Dow Jones

• Primary View:
  • Last week was characterized by a considerable drop, with marked declines on Tuesday, Wednesday, and Thursday.
  • Friday witnessed a minor correction, which appears to be merely a take-profit move ahead of the weekend.
  • Currently, the index grapples with a pivotal horizontal support level at 34,500 points. However, the price remains tethered above the significant uptrend line, painted in blue. The overarching sentiment would continue to be bullish as long as we remain atop this blue line.
• Alternative View:
  • A decisive breach below the blue line would serve as a potent sell signal.

3. EURPLN (Euro to Polish Złoty)

• Primary View:
  • The currency pair once again approached the 4.48 horizontal resistance, delineated in green, but faltered in its bid to surpass it.
  • The prevailing sentiment will be bearish as long as the price stays beneath this green threshold.
• Alternative View:
  • Should the price ascend beyond the green zone, managing to close a day above it, it would provide a robust buy signal.