Home Forex Market Analysis FX Major Pairs, Dollar Index, and Light Crude Oil Weekly Outlook

FX Major Pairs, Dollar Index, and Light Crude Oil Weekly Outlook

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FX Major Pairs, Dollar Index, and Light Crude Oil Weekly Outlook

EUR/USD: The dollar loses ground against the euro ahead of US CPI

The US dollar appeared to struggle against the other major currencies on Monday coming at the back of last Friday’s disappointing jobs data. The EUR/USD surged 0.46% before pulling back late on to trim session gains. The US jobs data was wide off the mark on Friday after posting 559k jobs for May compared to the expectation of 650k. 

This week, traders will be looking forward to Thursday’s US consumer price index data, ex-food and energy. Analysts expect the (YoY) growth to be stronger than the previous month, while the monthly growth is expected to be softer than in April. 

From the euro perspective, traders will be looking forward to Tuesday’s EU GDP data for Q1 and Thursday’s ECB rate decision. All figures are expected to remain unchanged from the previous reports. The G7 meeting is also expected to have a significant impact on the currency pair as the world’s largest economies discuss economic policy. 

EUR/USD chart

Technically, traders will target bullish profits at around 1.2224 or higher at 1.2261. On the other hand, the bears will look to pounce for profits at 1.2146 or lower at 1.2107. The pair appears to have recently pulled back off overbought levels of the 14-hour RSI. This will keep the bears more optimistic ahead of a busy week.

GBP/USD: Pound sterling bounces back against the dollar ahead of BoE’s monetary policy update

Pound Sterling trades bullishly ahead of a relatively busy period in the UK market. On Thursday, BoE’s Andrew Haldane will deliver his monetary policy update speech ahead of the G7 meeting later in the week. The BRC like-for-like retail sales data for May showed yearly growth of 18.5% which was softer than the previous period’s equivalent of 36.%. But this was still big enough to spike a rebound in the GBP/USD currency pair. Traders will also be looking forward to Friday’s factory figures with the Industrial production and Manufacturing production for April released alongside the GDP data.

GBP/USD chart

Technically, the GBP/USD currency pair appears to have surged closer to overbought levels of the 14-hour RSI. This could trigger a short-term pullback. The bears will target pullbacks at around 1.4143 or lower at 1.4109. On the other hand, the bulls will look to pounce at around 1.4211 and 1.4246.

USD/JPY: The US dollar plummets to new 2-week lows against the yen

The USD/JPY traders will be looking forward to Japan’s gross domestic product data for Q1 on Tuesday. The quarterly outcome of -1% was better than the expectation of -1.2% and -1.3% reported in the previous reading. Annualized GDP showed more improvement falling 3% compared to an expected decline of 4.8% and 5.1% reported previously.

USD/JPY chart

The bears will be looking forward to more downward movement before the US data arrives late on Tuesday and later in the week. They will target profits at around 108.949 or lower at 108.642. On the other hand, the bulls will target rebounds at around 109.564 and 109.873.

USD/CHF: The greenback plunges below 100-hour MA against Swiss franc

Again, the USD continued to struggle against other currencies falling further against the Swiss franc on Monday. This came after the Swiss unemployment rate came in at 3% compared to the previous reading of 3.2%. We could see some rebound in the USD/CHF later in the week when more US data trickles in.

USD/CHF chart

The USD/CHF currency pair continues to trade in an ascending channel formation in the 60-min chart. It has now pulled back to find support off the base trendline. This could trigger a rebound. The bulls will target short-term rebounds at 0.8995 or higher at 0.9021 whereas bears will look to extend declines towards 0.8953 or lower to 0.8930.

USDX: The US dollar index recovery put on hold after the pullback

The US dollar index extended Friday’s pullback on Monday as traders continued to trade off the disappointment of the non-farm payroll data. Traders will be looking forward to key economic data coming out on Thursday and Friday. But before that, it looks like risk-on trading will continue to dominate the market with traders fleeing the greenback.

US dollar index chart

Technically, traders will be targeting short-term bullish profits at around 90.20 or higher at 90.41. On the other hand, the bears will look to pounce at around 89.74 or lower at 89.54.

WTI Crude Oil pulls back off 2-year highs

Oil prices extended gains through last week before Monday’s pullback. OPEC+ members reassured the market of their intention to maintain gradual production increments. Traders will be looking forward to this week’s rig count data from the American Petroleum Institute (API) on Tuesday and the Energy Information Administration (EIA) report on Wednesday.

Light Crude Oil futures

Traders will target bullish profits at around $69.97 or higher at $70.94 while bearish profits can be targeted at $68.38 and $67.53.

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