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The US Dollar surged on Friday given the double whammy or weakness seen in both GBP and EUR following the UK’s Brexit vote. While the short term is sure to see both bullish and bearish swings as further details emerge serving to smooth out political and financial uncertainties, the long term outlook is solid for the global reserve / safe haven currency with Asian peers carrying a tad more risk in terms of government meddling.
The USD Basket’s daily chart indicates a confluence of resistance at 2016 falling highs and the 200-day moving average, a breakout above which will be a strong signal to bulls that all-time highs north of 100 could be re-visited in the next 12-months. Bears, however, will hope for resistance to hold this time, targeting 95 and the 50-day moving average below.
That said, both focus and, I’m sad to say, pressure is surely on GBP and EUR right now as cue-givers for the direction of the Dollar. Sterling will be a slave to any UK political chatter, with the ‘Leave’ lot looking to dampen fears of financial Armageddon (not enough for Boris Johnson to say how nice he thinks Mark Carney is…). The Euro will remain driven by any updates on the European Commission’s preferred road-map for Brexit and how easy a ride the UK is afforded (too easy and the wider collapse of the EU is a near certainty).
UK Economic Announcements
07:00 Nationwide House Prices (UK)
Intl Economic Announcements
13:30 Advance Goods Trade Balance (US)
14:45 PMI (US)
15:30 Dallas Fed Manufacturing (US)
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Intl Economic Announcements
13:30 Final GDP (US)
14:00 S&P House Prices (US)
15:00 Richmond Manufacturing Index (US)
15:00 Consumer Confidence (US)
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UK Economic Announcements
09:30 Mortgage Approvals and Lending
10:30 BoE financial Stability Report
Intl Economic Announcements
07:00 GFK Consumer Sentiment (DE)
08:55 Unemployment (DE)
10:00 Confidence surveys (Bus, Econ, Cons) (EZ)
13:30 Personal Spending & Income (US)
15:00 Pending Home Sales (US)
15:30 Oil Inventories
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UK Economic Announcements
00:05 GFK Consumer Confidence
09:30 GDP, Services, Business Investment
Intl Economic Announcements
07:00 Retail Sales (DE)
10:00 Consumer Price Inflation (EZ)
12:30 ECB Minutes
14:45 Chicago PMI (US)
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UK Economic Announcements
09:30 PMI Manufacturing
Intl Economic Announcements
08:50 Manufacturing (FR)
08:55 Manufacturing (DE)
09:00 Manufacturing (EZ)
10:00 Unemployment (EZ)
14:45 Manufacturing (US)
15:00 ISM Manufacturing (US)
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