Forex Signals Brief for July 9: The Majors in Play

Markets are getting ready for another busy week as a number of developments around the world will play an important role in how the major pairs trade.

The first point to worry about for traders is how the US-China trade war will impact the USD. On Friday, it appeared that it was having a negative impact. Even though we saw a rally in US equities on the back of a solid US employment report. The USD fell as the US-China tariffs came into effect.

The USD has a few major releases this week, namely, CPI and PPI, which could well help prop up the price action if the data positive.

The USD/CAD will also be in the gun. As the BOC meets on interest rates. Expectations are mixed here, but the Loonie has been one of the big movers in recent weeks.

Brexit headlines will keep the GBP/USD busy. As has been the case over the last few months. While Euro traders will get to look behind the curtain, as the ECB minutes will be released.

Forex Signal Update

The FX Leaders team had a relatively neutral week over the last seven days. We had seven winning signals and seven losers. It was a bit of an unusual trading week, with the 4th of July holiday and the shortened hours. Holidays never make for ideal conditions, as volume and momentum are often significantly impacted. Certainly in the majors.

Gold – Gold has continued to trade in a relatively tight range. Despite the USD breaking down and the US-China trade wars hurting confidence. Generally, gold will trade inversely to the USD price action. So looking to the long side here is a good idea. That correlation doesn’t appear as strong as it has previously been, but we don’t want to fade fundamentals.

Bitcoin – BTC is back at its most recent highs and is trying to take out $6,800. This has been a really strong resistance level and it is one that is proving a tough nut to crack. The fact that we didn’t sell-off over the weekend is a positive in my eyes. And if we can hold above this level it might bring in the short-term buyers.

USD/JPY – Active Signal

The Yen has been an interesting trade over the last few sessions. Despite some USD weakness, the USD/JPY has held up quite well. There could have been a case for a bigger sell-off but it appears that hasn’t happened.

Our stop is getting tested to the downside here, but given how well we’ve held up on a relative basis there is a chance of a strong rebound here. If the USD rebounds, I would expect this pair to outperform to the upside. Especially compared to some of the other majors.