Daily Market Outlook, July 15, 2020 

<h2><span>Daily Market Outlook, July 15, 2020 </span></h2>
<p><span><strong>Asian stocks were mostly higher on vaccine optimism following reports of a positive trial by Moderna Inc.</strong> Chinese and Hong Kong equities underperformed, however, on rising US-China tensions. Separately, the Bank of Japan left policy settings unchanged, including leaving interest rates at -0.1%, the 10yr yield target at 0% and asset purchases unchanged. </span></p>
<p><span><strong>UK inflation figures were released earlier this morning</strong>. Headline CPI increased to 0.6%y/y in June from 0.5%y/y. It remains well below the 2% target. The temporary six-month VAT cut to 5% for hospitality and tourism comes into effect today, which is expected to have some downside impact on near-term inflation prospects. Chancellor Rishi Sunak will appear at the House of Commons Treasury Committee at 2pm today. </span></p>
<p><span><strong>US June industrial production figures and the July New York Fed Empire manufacturing survey are the key data releases today.</strong> Look for industrial production to post a decent gain of 5.0%, but that would still leave the level of output well below pre-Covid levels. The NY Empire survey is also expected to show a further improvement as businesses reopen. However, with Covid-19 cases rising in southern parts of the country, markets will be watching for signs that activity may be starting to level off. In that respect, the Fed Beige Book may receive more attention than usual as it provides timelier evidence on current and expected economic activity. </span></p>
<p><span><strong>The Bank of Canada is expected to leave interest rates unchanged at 0.25%</strong>, but markets will be watching to see if it adjusts the pace of its asset purchases or its forward guidance. It will be Tiff Macklem’s first policy meeting as Governor. </span></p>
<p><span><strong>In the UK, Bank of England MPC member Silvana Tenreyro will speak on a webinar about “Covid-19 and the economy” at 9am</strong>. At 7am Thursday morning, UK official labour market data will be released. Look for  the unemployment rate rising to 4.1% in the three months to May (4.6% for the single month of May). Three-monthly employment growth is forecast to fall by 275k and headline average earnings growth is expected to turn negative at -0.7%, highlighting the hit to earnings from the furlough scheme. </span></p>
<p><span><strong>Earlier on Thursday morning (3am UK time), China will release Q2 GDP which is expected to show a rebound to 2.4%y/y after falling 6.8%y/y in Q1</strong>. The monthly data (to May) have so far pointed to a stronger recovery in industrial production than in retail sales.</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: 1.1350 (680M)</span><b>, 1.1400 (1.7BLN), </b><span>1.1425 (450M), 1.1450 (900M)</span></li>
<li><span>USDJPY: </span><b>107.00-05 (1.1BLN), 107.25-30 (1.2BLN)</b></li>
<li><span>AUDUSD: 0.6930-40 (650M)</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>EURUSD 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. As 1.1366 contains the upside look for a move to test bids back towards 1.12 before another upside attempt </span><span>NOTE </span><a href="https://www.linkedin.com/feed/update/urn%3Ali%3Aactivity%3A6685831276143886336/"><span>DTCC option reported data shows 40 billion euros evenly spread between 1.1200 and 1.1400 for the week ahead.</span></a><span> UPDATE price is testing prior cycle highs, any profit taking pullback should find support at 1.13 ahead of the anticipated 1.15 test.</span></p>
<p><img class="aligncenter size-full wp-image-47099" src="http://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.40.00.png" alt="" width="2139" height="1201" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.40.00.png 2139w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.40.00-300×168.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.40.00-1024×575.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.40.00-768×431.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.40.00-1536×862.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.40.00-2048×1150.png 2048w" sizes="(max-width: 2139px) 100vw, 2139px" /></p>
<p><b>GBPUSD Bias: Bullish above 1.25 targeting 1.28</b></p>
<p><span>GBPUSD From a technical and trading perspective, as 1.25 attracts sufficient demand, look for a grind higher to test offers and stop at 1.28. A closing breach of 1.25 suggests return to range and a test of range support at 1.2250. UPDATE 1.25 test underway, a failure to regain 1.26 will open a move to test 1.24 UPDATE a close through 1.26 will flip the daily chart bullish and open 1.28, a failure to sustain trade above 1.26 opens a retest of 1.24 before higher</span></p>
<p><img class="aligncenter size-full wp-image-47101" src="http://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.22.png" alt="" width="2137" height="1198" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.22.png 2137w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.22-300×168.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.22-1024×574.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.22-768×431.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.22-1536×861.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.22-2048×1148.png 2048w" sizes="(max-width: 2137px) 100vw, 2137px" /></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. UPDATE 107.50 remains the pivot with more sizeable expiries noted today, through 107.10 opens equality objective at 106.87 UPDATE equality objective achieved as 107.30 caps the upside look for  a retest of 106.30’s</span></p>
<p><img class="aligncenter size-full wp-image-47102" src="http://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.57.png" alt="" width="2140" height="1203" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.57.png 2140w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.57-300×169.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.57-1024×576.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.57-768×432.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.57-1536×863.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.41.57-2048×1151.png 2048w" sizes="(max-width: 2140px) 100vw, 2140px" /></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 support. A closing breach of .6900 opens another test of bullish appetite at .6880</span></p>
<p><img class="aligncenter size-full wp-image-47104" src="http://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.42.42.png" alt="" width="2144" height="1200" srcset="https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.42.42.png 2144w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.42.42-300×168.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.42.42-1024×573.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.42.42-768×430.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.42.42-1536×860.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/07/Screenshot-2020-07-15-08.42.42-2048×1146.png 2048w" sizes="(max-width: 2144px) 100vw, 2144px" /></p>
<p><i><span>Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.</span></i></p>
<p><i><span>High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% and 76% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.</span></i></p>
<p>The post <a rel="nofollow" href="https://blog.tickmill.com/tech-analysis/daily-market-outlook-july-15-2020/">Daily Market Outlook, July 15, 2020 </a> appeared first on <a rel="nofollow" href="https://blog.tickmill.com">Tickmill</a>.</p>