EUR/USD 23-27 July analysis by redFX

This weeks  (23-27 july 2012) looks like EU more weak than previous week. If previous week some speculation US will do QE make EUR/USD hold for few day before fall, this week looks more hard to Euro.
I try to figure out weekly candle, using Deviation Channel 200 day back like my picture above.

BEAR CHANCE

Seller having more power this week, specially after 2 time Bernanke speach not give sign of QE (Quantity Easing) like market expected last week. My trading plan will waiting correction at 1.22xx (50% fib from friday fall) to selling with destination 1.208x and 1.200x area this week.
Others scenario is direct selling if EU not make any retracement from last friday fall.

BULL CHANCE

Actually, trading against trend are high risk cost for me :) but.. high risk = high profit. Anyway, i am not suggest it. Test back 1.22 (50% fib from friday fall) looks like will happen this week, in anothers side, seller will likely placing limit order at that area too. So buyer maybe having chance to buying  correction till 1.220x
Others scenario is test back 1.22 area can fail.

by redFX

EVENTS TO WATCH

Monday, July 23
Australia: PPI is likely to increase by 0.3% q/q in Q2 after a 0.3% drop in Q1 - still this a very small gain. The release is especially important ahead of the CPI release on Wednesday.
Euro area: Consumer confidence. Economists surveyed by Bloomberg News predict that an index of household sentiment in the euro region was probably unchanged this month from June at minus 19.8, remaining close to 3-year minimum.

Tuesday, July 24
China: HSBC flash manufacturing PMI. In June the index came at 48.2, its lowest reading in 7 months.
Euro area: PMIs. A gauge for manufacturing in the currency bloc is estimated to be at 45.3 in July. That’s below the 50 level that separates expansion from contraction and compares with a reading of 45.1 last month.
Canada: Retail sales. Data release may cheer the investors up a little bit: according to forecasts, core retail sales increased by 0.2% m/m in May vs. a decline by 0.3% in April, while retail sales -  to grow by 0.3% vs. a previous 0.5% drop.

Wednesday, July 25
Australia: Consumer prices probably grew 1.3% in Q2 y/y, what would match the slowest annual pace since June 1999.
Germany: Ifo Business Climate might paint a brighter picture of current business conditions, but it is likely to show that companies are losing confidence in the future.
UK: - Preliminary GDP (Q2). The figures are expected to confirm the fears that the UK is still in recession: British economy may have fallen by 0.2% (q/q). This would be the third successive quarterly fall, and would mean that GDP is lower now than it was in the third quarter of 2010, and 3.9% below its pre-recession peak.
      - CBI Industrial Order Expectations. The index improved in June coming better than expected. If this data are confirmed, hopes will rise that the UK will recover in Q3.
US: New home sales will likely continue to improve, though from a very low base.
New Zealand: The RBNZ meeting. Currency markets will be waiting for the Reserve Bank of New Zealand rate decision. According to Credit Suisse data, traders appear to be anticipating a 95% chance of no change to the current benchmark lending rate. Annual inflation is holding at the lower end of the RBNZ's annual target band of 1-3%, increasing the chances that the bank will keep the cash rate at a record low 2.50 % level until summer 2013. The rate was last lowered in March 2011.

Thursday, July 26
Euro area: Private loans. The ECB data may show that bank lending to the private sector is stagnating. The European crisis is reducing banks’ ability to lend and companies’ willingness to borrow.
US: Durable goods orders may have increased 0.4 percent in June, less than the 1.3 percent gain in May. Pending Home Sales.

Friday, July 27
US: Advance GDP (Q2). Though US economy is doing better that the euro zone’ or the UK ones, economists expect it to add only 1.5% (q/q), showing the slowest growth pace since June 2011. In Q1 American economy increased by 1.9%.