THE LONDON OPENING 11-07-2022
EUROPEAN STOCKS OPENED LOWER FOLLOWING A NEGATIVE ASIAN SESSION; THE EURO IS STILL UNDER PRESSURE, WHILE INVESTORS AWAIT FOR KEY MACRO DATA AHEAD
European equities opened lower this morning after a negative Asian session. Most indices lost between 1 and 2% (except for the Nikkei), partly due to fears of new lockdowns in China, where the first case of BA.5 Omicron was reported. Investors, still worried about the global economic slowdown and inflation that shows no sign of stopping, are waiting for key data this week, especially from the States, where CPI and core CPI data will be released on Wednesday.
In Japan, the recently assassinated former Prime Minister Shinzo Abe coalition party won a robust election victory. The market interpreted this result as a possible continuation of ultra-loose monetary policies, with the Jen hitting a new all-time low against the Dollar.
Regarding the economic calendar, no notable event will be released today, apart from Italian Retail Sales; a speech by the BoE governor Bailey is also expected today, while a member of the FOMC will speak this afternoon.
EURUSD, M15
The EURUSD continues to be under pressure, falling during that Asian session to the D-1 VAL. It is trading below the last week’s POC, which can be considered a negative bias for today. From a technical point of view, the main intraday resistance level in the D-1 VAL while the most important support level is the W-1 VAL. As long as prices remain below the mentioned resistance area, the most likely scenario is a continuation of the drop until the W-1 VAL around the 1.0087 mark. On the other hand, should prices regain the D-1 VAL and consolidate above it, a pullback to the W-1 POC is expected.
Main intraday support areas where to look for long trades in case of bullish candlestick pattern or short trades in case of bearish candlestick pattern: 1.0087, 1.00.
Main intraday resistances areas where to look for short trades in case of bearish candlestick pattern or long trades in case of bullish candlestick pattern: 1.0135, 1.0188.
GBPUSD, M15
The Cable dropped during the Asian session but is now trading above the W-1 POC, which can be considered a positive bias today. From a technical point of view, the most critical intraday support area is the W-1 POC, while the main intraday resistance area is the D-1 VAL. As long as prices remain below the D-1 VAL, the most likely scenario is a continuation of the drop until the W-1 POC and eventually to the W-1 VAL around the 1.1909 mark in extension if prices manage to break the support area. On the other hand, if prices succeed in retrieving the 1.1981 mark and consolidating above it, a pullback to the W-1 VAH is expected.
Main intraday support areas where to look for long trades in case of bullish candlestick pattern or short trades in case of bearish candlestick pattern: 1.1956, 1.1909.
Main intraday resistances areas where to look for short trades in case of bearish candlestick pattern or long trades in case of bullish candlestick pattern: 1.1981, 1.2025.
