EU Recession Set To End? Eyes On GDP Release

• The euro (EUR) appeared weak throughout the Asian session; currently trading below 1.3260 versus the US dollar (USD). Eurozone will release their first estimate of the year’s 2nd quarter Gross Domestic Product (GDP) at 09:00 GMT and market consensus is that the troubled economy has expanded following for the first time in 6 quarters.
• The US dollar (USD) is trying to break-and-hold above its resistance level around 98.30 against the Japanese yen (JPY). The pair is held hostage to the Fed’s rhetoric regarding their tapering or not of their stimulus program. The better than expected Retail Sales release yesterday increased expectations that there will be reduction in asset purchases sooner than later.

• Equities are reacting favourably to markets anticipation that the Eurozone will announce its first positive GDP in 6 quarters. Special attention should be pair to the GER 30 (DAX) as Germany is the economic powerhouse of Europe.

• WTI Crude (OIL) is trading above 106.25 US dollars per barrel. The crude oil advances on speculation that US stockpiles decline as there is increasing demand for crude oil during summer.

A rebound promises the best risk/reward potential and traders wishing to participate in the Sterling upside potential could do so by buying an at-the-money CALL. This limits the risk to the premium paid, removes the risk of getting stopped out due to choppy movements and allows for unlimited profit if the direction is right.

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