Weekly Market Commentary | 24.07 – 30.07

Weekly Market Commentary | 24.07 – 30.07
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.
  • European manufacturing and services PMIs take center stage: France, Germany, Eurozone, and the UK are releasing their PMIs.
  • Interestingly enough, most manufacturing PMIs are expected to come below 50, while services PMIs are generally expected to surpass this mark.
  • The US is set to unveil its set of PMIs as well.
  • German IFO Business Climate forecast at 88.
  • CB Consumer Confidence from the US anticipated to come in at 112.1.
  • The Australian yearly inflation is predicted to decelerate to 5.5%.
  • The US Federal Reserve FOMC statement will be released, accompanied by the interest rate decision and subsequent press conference.
  • The market anticipates a 25-basis-point hike which would bring the rates to 5.5%.
  • European Central Bank decision day: a 25-basis-point increase is widely anticipated, which would place the rates at 4.25%.
  • ECB press conference will be the key event to watch for.
  • Quarterly US Advanced GDP is forecast to come in at 1.7%.
  • The Bank of Japan rate decision will kick off the day, followed by the monetary policy statement and outlook report.
  • Preliminary inflation numbers from Germany expected to remain steady at 0.3%.
  • GDP figures from Canada anticipated at 0.3% growth.
  • A trio of data from the US: Core PCE Price Index forecast at 0.2%, Employment Cost Index expected at 1.1%, Revised University of Michigan Consumer Sentiment predicted to come in at 72.6.
Setups for This Week:
Primary View:
  • The price has formed a double bottom over the past two months, highlighted in blue.
  • As of the moment, the pair is testing the neckline of this pattern, indicated in yellow.
  • The price remains below the down-trend line depicted in red.
  • A break above the yellow resistance and the red down-trend line would activate the double bottom formation, suggesting an opportunity to buy.
Alternative View:
  • If the price bounces off the down-trend line and falls below the yellow area, it will signal a potential shorting opportunity.

Primary View:
  • The index is in a solid up-trend, consistently respecting the long-term blue up-trend line.
  • The price remains above the critical horizontal support marked in green, at 15 250 points.
  • Maintaining the positions above these two key levels would indicate a bullish sentiment.
Alternative View:
  • A break below the blue up-trend line and the green horizontal support would offer a significant mid-term sell signal.

Primary View:
  • The price honored the correction equality pattern seen on the weekly timeframe.
  • Additionally, the price adhered to the 61.8% Fibonacci resistance.
  • Last week, there was a bounce off these twin resistances, opening up a potential medium-term selling opportunity.
  • The process of forming the third peak of a triple top pattern is underway. A decisive, long-term sell signal would appear should the red neckline break.
Alternative View:
  • If the price surpasses the 61.8% Fibonacci and closes a day above that level, it will provide a compelling buy signal.
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