Will US CPI Data Spark a Dollar Breakout or Further Losses for GBPUSD and NZDUSD?

Important Economic Events and Data

The ECB will release the interest rate decision. —— Thursday

The ECB kept three key eurozone interest rates unchanged, meeting market expectations, according to the July interest rate decision.

Specifically speaking, the deposit facility rate and the main refinancing rate stayed the same at 2.25% and 2.40% respectively, and the margin loan rate was kept unchanged at 2.65%.

There are no preset interest rate paths, and the specific interest rate policy will depend on data, the ECB reiterated.

US CPI, y/y (August) —— Friday

US CPI, y/y (July) decreased from 3.5% to 3.4% Vs. 3.4% (forecast), and US CPI, m/m (July) increased from -0.1% to 0.1% Vs. 0.1% (forecast), according to the data from the US Department of Labor.

The U.S. shelter and housing price indices ticked up by 0.1% month-over-month in July, accounting for one third of overall CPI growth, according to the data.

The US inflation is generally modest, which lowered the concern that prices will rebound beyond expectations in the short term.

View economic data and events in details

Major Financial Instruments

USOIL——the Chart of the Week

Last week, as the tension in the Middle East persisted, and EIA inventories decreased, USOIL was boosted, and broke above the US$90 mark. On the chart of the week, USOIL was prone to fluctuation and climbed. Investors should focus on whether USOIL will break through the support at 83.4. It will rise with potential resistance at 92.5 if it retreats but is stable above 83.4, and it will continue jumping if it breaks above 92.5.

the Chart of the Week

GBPUSD——the Chart of the Week

Last week, as the USDX climbed, and the expectation that the BOE will increase the interest rate cooled down, USDCAD was capped, and broke below the 1.350 mark. On the chart of the week, GBPUSD fell from a high level. It is likely to retreat in the short term. Investors should focus on whether GBPUSD will break through the resistance at 1.360. It will fall with potential support at 1.340 if it rebounds but is capped at 1.360.

the Chart of the Week

NZDUSD——the Chart of the Week

Last week, as the USDX rebounded, and New Zealand economy grew at a lower pace, NZDUSD was capped, and came close to the 0.580 mark. On the chart of the week, NZDUSD was prone to fluctuation at a high level and fell. The bearish market trend prevailed in the short term. Investors should focus on whether NZDUSD will break through the resistance at 0.593. It will dip with potential support at 0.576 if it rebounds but is capped at 0.593.

the Chart of the Week

58.37% of retail CFD accounts lose money

Due to passage of time and market volatility, some of the above patterns observed may no longer be valid.