Daily Market Outlook, July 08, 2020

<h2><span>Daily Market Outlook, July 08, 2020 </span></h2>
<p><span>Market mixed in Asia with risk sentiment generally subdued. The US government announced plans for a further $1trn of stimulus. Fed Vice Chairman Clarida indicated that the central bank will probably adopt additional forward guidance and asset purchases if needed. Both the Fed’s Mester and Bostic said that economic activity may be “levelling off” due to the coronavirus. </span></p>
<p><span>The main event today will be Chancellor of the Exchequer Sunak’s update to the House of Commons on the economic outlook from about 12.30pm. In a speech last week, PM Johnson said that the focus of policy will be on stimulating economic growth and that there would be no early return to austerity despite the escalation in the government’s budget deficit. There has been considerable speculation that the Chancellor will announce measures to boost growth and support jobs and training, especially for the young with reports of a £2bn “kickstart” scheme to pay minimum wages for up to 25 hours a week for 16-24 year olds. There is also emphasis on more targeted measures to help sectors under particular pressure, such as the announcement at the weekend of support for the arts sector and a possible temporary reduction in VAT. There is also speculation of a stamp duty holiday to support the housing sector. The Chancellor is not expected to unveil any new economic forecasts this week. However, the Office for Budget Responsibility is scheduled to release a report on 14th July containing three economic scenarios for the UK economy. These are likely to form the basis for budget planning going forward. </span></p>
<p><span>ECB Vice President Guindos participates in a virtual meeting. At the weekend, ECB President Lagarde said inflation will likely remain subdued in the next couple of years. In the US, Atlanta Fed President Bostic takes part in a webinar on the economy. </span></p>
<p><span>In the early hours of Thursday, the UK RICS housing survey will be released. The headline balance of respondents reporting higher house prices in England and Wales fell to -32% in May, but the consensus forecast is for an improvement in June to -25%. China will also release June inflation figures, with markets looking for broad stabilisation in consumer price inflation after sharp declines in the previous three months. The consensus forecast is for headline CPI to edge up to 2.5% from 2.4%, while some let-up in producer price deflation is also anticipated at -3.2% from -3.7%</span><span>.</span></p>
<h3><b>Today’s Options Expiries</b><span> for 10AM New York Cut (notable size in bold)</span></h3>
<ul>
<li><span>EURUSD: .1250 (550M), 1.1275 (250M), </span><b>1.1300 (1.9BLN)</b><span>, 1.1305-10 (800M), 1.1320 (320M).</span></li>
<li><span>USDJPY: </span><b>107.45-55 (3BLN)</b><span>, 108.00 (500M)</span></li>
<li><span>AUDUSD: 0.6895-0.6900 (550M), 0.6975 (513M), 0.6985-90 (500M), 0.6995-0.7000 (450M)</span></li>
</ul>
<h3><span>Technical &amp; Trade Views</span></h3>
<p><b>EURUSD Bias: Bullish above 1.1150 targeting 1.15</b></p>
<p><span>From a technical and trading perspective, as symmetry swing support at 1.1170 supports there is a window for fresh demand to take prices higher again to retest cycle highs above 1.14 enroute to an ultimate retest of year to date highs at 1.15. Price is testing intraday range resistance at 1.13 A failure to close above here could see a move back to test range support at 1.12 before attempting another run at 1.1350 UPDATE 1.13 back in play through here opens 1.1340 ahead of 1.14 daily VWAP bullish</span></p>
<p><img class="aligncenter size-full wp-image-46689" src="http://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.20.23.png" alt="" width="2141" height="1237" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.20.23.png 2141w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.20.23-300×173.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.20.23-1024×592.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.20.23-768×444.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.20.23-1536×887.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.20.23-2048×1183.png 2048w" sizes="(max-width: 2141px) 100vw, 2141px" /></p>
<p><b>GBPUSD Bias: Bullish above 1.24 targeting 1.2650</b></p>
<p><span>GBPUSD From a technical and trading perspective, 1.2324 equality downside objective achieved, buyers have stepped in again as of writing to defend the equality objective. The close back through 1.2440 suggests a more meaningful low is in place for another attempt to take out stops above 1.2650. A close back through 1.24 would concern the bullish bias, however as 1.2350 attracts bids there remains an opportunity to test the 1.2650 upside objective</span></p>
<p><img class="aligncenter size-full wp-image-46691" src="http://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.25.48.png" alt="" width="2140" height="1235" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.25.48.png 2140w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.25.48-300×173.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.25.48-1024×591.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.25.48-768×443.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.25.48-1536×886.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.25.48-2048×1182.png 2048w" sizes="(max-width: 2140px) 100vw, 2140px" /></p>
<p><b>USDJPY Bias: Bullish above 107.50 Bearish below</b></p>
<p><span>USDJPY From a technical and trading perspective, anticipated test of the equality objective at 108.13 saw bearish reversal patterns, setting up a move for  another test of 106 enroute to a pivotal 105 test UPDATE Note three billion worth of expiries at 107.45/55 today</span></p>
<p><img class="aligncenter size-full wp-image-46692" src="http://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.27.55.png" alt="" width="2143" height="1238" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.27.55.png 2143w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.27.55-300×173.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.27.55-1024×592.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.27.55-768×444.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.27.55-1536×887.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.27.55-2048×1183.png 2048w" sizes="(max-width: 2143px) 100vw, 2143px" /></p>
<p><b>AUDUSD Bias: Bullish above .6830 targeting .7100)</b></p>
<p><span>AUDUSD From a technical and trading perspective, as 6830 attracts buyers there remains scope to retest and break prior cycle highs en route to a .7100 test. Expect bids towards .6900 to act as intraday support</span></p>
<p><img class="aligncenter size-full wp-image-46693" src="http://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.28.54.png" alt="" width="2139" height="1236" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.28.54.png 2139w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.28.54-300×173.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.28.54-1024×592.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.28.54-768×444.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.28.54-1536×888.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-08-08.28.54-2048×1183.png 2048w" sizes="(max-width: 2139px) 100vw, 2139px" /></p>
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