The US dollar is facing a tough day today as it finds itself in the red zone when compared to other major currency pairs in the market. As of today, the USD is down 0.22% against the Euro, 0.29% against the British Pound, and a whopping 0.78% against the Japanese Yen. We anticipate that the trading day will end with the US Dollar still facing the bears and struggling under tough waters.
Coming up on Tuesday, the Eurozone will release its Consumer Price Index for July which will help us to understand the change in the price of goods and services over time due to inflation. The report was previously 0.6%, and we expect it to jump to 0.8%, which will be bullish for the Aussie Dollar.
Keep in mind that the US will also release its FOMC meeting minutes mid-week, which is known to cause all USD markets to become relatively volatile for the rest of the week. This meeting will determine the future of the interest rates in the country and how it compares to the inflation rate.
Early next week, the US Census Bureau is going to release the new home sales for July. This will help us understand if the real estate market is thriving or shrinking. The new home sales were previously 617K, and they are expected to increase significantly to 630K, which should be bullish for the USD.
EUR/USD Currency Pair
The EUR/USD pair started off the day at 1.096 before slowly finding its way up the charts. The Euro was taking control and the pair reached a daily high of 1.100 before finding its way back down. The bulls are still in favor of the Euro and it is clear that the US Dollar is struggling under hot waters.
Just yesterday, the US released its Building Permits data which helps us understand if the level of economic development in the country has changed. The data revealed that the number of building permits issued had dropped quite significantly. The numbers were previously at 1.454M, and we expected it to increase to 1.430M. However, it dropped quite significantly to 1.396M instead.
Early today, the US released its Housing Starts for July which measures the change in the annualized number of new residential buildings that began construction during the reported month. The report was previously 1.329M and was expected to increase to 1.340M. However, it dropped to 1.238M.
Key support levels to look out for with the EUR/USD are 1.0987 and then further down to 1.0982. Moreover, key resistance levels are 1.099 and further up to 1.100.
USD/JPY Currency pair
The USD/JPY pair started off the day at 149.25 before facing consistent drops through the charts. The pair reached a daily high of 149.31 right at the beginning of the day and this figure is yet to be seen again. The USD/JPY pair is now fluctuating around 148.11 and is expected to drop even further.
The US released its retail sales report for July, which helps us understand the change in sales over time due to inflation and is a great measure of consumer spending. The report was previously -0.2% and we expected it to rise to 0.4%. However, it rose quite a bit more to 1.0%, which was unexpected.
Yesterday was a very busy day for the European Central Bank as it held several conferences along with publishes of their monetary policy meeting. These meetings tend to cause disruption and they did so on a positive note as the Euro was seen flying above the charts well over the US Dollar.
Key support levels to look out for with the USD/JPY are 147.97 and then further down to 147.75. Moreover, key resistance levels are 148.15 and further up to 148.39.
USD/CHF Currency Pair
The USD/CHF pair started off the day at 0.871 and was surprisingly stable for the majority of the day. That being said, it faced a sudden drop mid-day and the pair found itself looking at a daily low of 0.8666. While it got back up, the damage has already been done and the USD is in the red zone.
The US released its initial jobless claims report yesterday which tells us the number of people who filed for unemployment for the first time this past week. The report was previously 234K and we expected it to rise to 236K. However, it surprisingly came out to be significantly lower at 227K.
Late yesterday, Switzerland released its Producer Price Index (PPI) which measures the change in the price of goods sold by manufacturers. The PPI report was previously 0.0% and was expected to increase to 0.4%. However, it was unchanged at 0.0% which shows the stability of this currency pair.
Key support levels to look out for with the USD/CHF are 0.868 and then further down to 0.867. Moreover, key resistance levels are 0.869 and further up to 0.870.