Headlines the Economic Calendar on Thursday
1. Turkey Interest Rate Decision
In Turkey, the CBRT will hold its monetary policy council meeting today. The governor Murat Uysal is widely expected to deliver a rate cut, with the only question being how much. The expectation is 250 basis point interest rate cut in the meeting. A huge rate cut would raise the risk on the Turkish Lira again.
2. ECB Interest Rate Decision The European Central Bank will announce its policy decision today.
Weaker inflation in the eurozone and downside risks from global trade issues amid rising expectations the ECB will cut interest rates further below zero and consider fresh asset purchases.
Most economists expect a 10 basis point deposit rate cut, more generous TLTRO conditions and €30 million per month of quantitative easing. The announcement will be followed by President Mario Draghi's news conference and his statements about inflation will be significant. The meeting will bring new information about the ECB's policy.
3. US Consumer Price Index Economists expect that the US CPI rose 0.1% in August. The year-on-year rate of inflation is expected to stay at 1.8%. The core CPI, which excludes food and energy prices, is expected to have risen 0.2%. US consumer price inflation has been tame in recent years and consistently below the Federal Reserve's 2% target.
Technical Analysis:
EUR/USD: Watch out for the ECB Interest Rate Decision today. The EUR/USD pair found sellers from the 1.1052 daily resistance and showed a downward movement yesterday. If the fall continues, we will see 1.0979 as a key support level. Moreover, in order for the bearish action to gain more momentum, it needs to break down and stay below 1.0979 on a daily basis. Otherwise, if the pair moves up, the daily resistance level can be seen at 1.1052 again.
Support: 1.0979 - 1.0837
Resistance : 1.1052 - 1.1114 - 1.1165
GBP/USD: The GBP/USD pair showed a downward movement from the key resistance level of 1.2364. As long as the price stays below 1.2364, on a daily basis, we will see 1.2286 and 1.2205 as support levels. On the other hand, if the pair rises above 1.2364, the next resistance level is holding at 1.2428.
Support: 1.2286 - 1.2205 - 1.2110
Resistance: 1.2364 - 1.2428 - 1.2502
USD/JPY: The Japanese Yen showed a downward movement versus the US Dollar as encouraging signs in U.S.-China trade situation improved investor sentiment. Focus on the 107.82 main support level. As long as the pair stays above 107.82, on a daily basis, the resistance level can be found at 108.14 and 108.52. In contrast, if the price drops below 107.82, the next support level will be at 107.52.
Support : 107.82 - 107.52 - 107.22
Resistance: 108.14 - 108.52 - 108.79
Gold: The Gold price found buyers from the 1492 daily support level and then moved up. In the event that the rise continues, we will follow the key resistance levels at 1509 and 1524. On the downside, If the price breaks below 1492, the next support level can be found at 1478.
Support: 1492 - 1478 - 1466
Resistance: 1509 - 1524 - 1540
USD/TRY: Keep your eye on the Turkey Rate Decision today. The Market expectation is 250 basis point interest rate cut in the meeting. We focus on the main resistance level of 5.7679. In order for the upward movement to gain more momentum, it needs to break out 5.7679 and stay above that level on a daily basis. Should this occur, the next resistance levels will be placed at 5.9763. Otherwise, we will follow the key support levels at 5.6027.
Support: 5.6027 - 5.4538 - 5.2883
Resistance: 5.7679 - 5.9763 - 6.1475
EUR/TRY: Ahead of ECB and Turkey Rate Decision, the EUR/TRY pair is trading above the 6.3290 main support level. If the pair stays above 6.3290 on a four hourly basis, the rise may gain more momentum and we will follow 6.4088 and 6.4978 as resistance levels. On the other hand, if the price falls below 6.3290, the next support level can be seen at 6.2588.
Support: 6.3290 - 6.2588 - 6.1819
Resistance: 6.4088 - 6.4978 - 6.6756
CRUDE OIL: The Crude Oil Price showed a sharp downward movement yesterday. The price now trading below the key level of 56.40. If the price stays below that level, on a four hourly basis, we will see the daily support level at 54.68. On the other hand, if the price goes above 56.40, the next daily resistance level can be seen at 57.98.
Support: 54.68 - 53.51 - 52.19
Resistance: 56.40 - 57.98 - 58.95