Trading plan for 10/08/2018
EUR/USD broke through 1.15 and the activation of stop-loss orders pushed the rate to 1.1438. The drop is probably related to the continued sale-off of the Turkish lira – today USD/TRY jumped another 3.0% up to 5,7450.
The Financial Times article is in the center of global investors attention, according to which European financial supervision is concerned about the exposure of European banks to Turkish assets. The investors’ uncertainty is also fueled by the planned presentation by the Ministry of Finance of Turkey of a new economic model that may not be market-friendly. Movement on EUR/USD initiated the appreciation of USD on another cross. GBP/USD is testing at 1.28, AUD/USD approaching important support at 0.7310 as the Financial Stability Report published by the RBA at the night brought a few surprises. The main change is the lowering of the CPI forecast for 2018 from 2%. up to 1.75 percent, but this information was already included in the statement after Tuesday’s decision.
In the stock market, the gloomy climate pushes prices down. Japanese Nikkei225 loses 1.4 percent and Chinese Shanghai Composite falls 0.4 percent.
On Friday, the 10th of August, the event calendar is full in important data releases, especially during the NY session. During this time Canada will issue Unemployment Rate, Employment Change, Part-Time Employment Change and Participation Rate. The US will post Consumer Price Index data and Federal Budget Balance data. There are some important data to be released during the London session as well: UK will post GDP, Visible Trade Balance and Industrial Production data and Germany will reveal Wholesale Price Index data.
EUR/USD analysis for 10/08/2018:
Let’s now take a look at the EUR/USD technical picture at the H4 time frame before the important data are released. The market has broken below the technical support at the level of 1.1507 and has hit the daily technical support at the level of 1.1445, but the spike down looks very strong and might not end soon. The momentum is pointing down to the south and it is way below its fifty level. The next technical support is seen at the level of 1.1365.
Beside the observing the situation on EUR/USD the market participants should keep an eye on USD/TRY pair as well.