UP NEXT:
No red news today so this makes larger price reactions less likely (excluding unscheduled news).
EUR: With EURUSD losing bearish momentum and seeing the largest buying from bullish speculators last week near current lows, it does raise the potential for a retracement over the coming weeks. Therefor monitor how Euro reacts on any good news to see further evidence of accumulation from price.
CAD: Core Retail sales are expected to soften so any upside surprise could see a weakening of USD/CAD. However USD/CAD continues to respect key levels of support so an weakness from sales could see further USD/CAD gains.
NZD: Trade Balance appears of have topped a few months ago. What will be interesting is to see how NZD//USD reacts if we see the deficit widen. An wider deficit and a break below key levels will suggest there is much more downside left. However if it hardly reacts on the face of bad news then it suggests the bears are running out of steam.
TECHNICAL ANALYSIS:
USD/CNY: Potential base forming in line with bullish wedge
This is the 3rd time I have highlighted this setup but the reason for the reminder is because I suspect we are witnessing the beginning of a base to form above support.
The strategy is to simply seek bullish setups in line with the anticipated trend which comes form the bullish wedge (if all goes well).
A break below the upper wedge line invalidates the bullish wedge scenario, with a break below 6.1306 swing low putting us back into bearish territory.
However I suspect we will see continued gains because the price action from the 6.265 highs appears to be corrective, and we have broken above the 6.163 swing high to suggest a change in trend (to the bull side).
AUD/USD: Selling into any rallies; Beware of potential bullish wedge
The AUD/USD has been boosted by Chinese Manufacturing PMI coming in 'slightly' above expectations. Therefore I expect the relief rally to run out of fizz and traders to sell into support levels.
I have highlighted a potential bullish wedge, but this is not my favoured scenario because the A$ is being driven down by USD strength and struggling Iron Ore prices.