Chinese data weaker but in line with consensus

<p>   EUR/USD Range: 1.2180-1.2215 Support: 1.2130 Resistance: 1.2325 The Euro continues to grind lower after making a fresh low yesterday at 1.2166 with the technical […]</p>



Range: 1.2180-1.2215
Support: 1.2130
Resistance: 1.2325

The Euro continues to grind lower after making a fresh low yesterday at 1.2166 with the technical picture looking ultimately at the June 2010 low of 1.1875 as we fail to rally above 1.2325. Rating agency Moody’s downgrading Italy’s sovereign debt rating by two notches to Baa2 from A3 which couldn’t have come at a worst time as Italy issue bonds today in various tenors. I’m expecting a quite range this morning 1.2150-1.2230 (at most) with JP Morgan results this afternoon along with US PPI and Michigan sentiment data I’m not ruling out a Friday the 13th squeeze to very short bearish Euro market.



Range: 1.5415 – 1.5445
Support: 1.5270
Resistance: 1.5580

Cable not immune to USD strength as the Queens currency retraces lower breaking the support at 1.5400 yesterday afternoon with the technical picture now looking for a test of recent lows at 1.5270. No UK data again today so I’m expecting the general $ theme to drive near term fortunes with EUR/GBP stuck 0.7875-0.7925 for the moment with exporters on the bid.



Range: 1.0122-1.0173
Support: 1.0100
Resistance: 1.0200

China’s Q2 GDP came in at 7.6% YOY, down from the 8.1% in Q1.Whilst it is the lowest reading since 2009 and below the consensus of 7.7% the outcome isn’t as mad as some had feared. The lifestyle currency had a relief rally on the back of a Chinese data being in line with expectations but failed to get back on a 1.0200 handle as we consolidate 1.0100-1.0200. I’m still bearish and will look to fade rallies to 1.0200 looking for a break 1.0045.

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.