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The New Zealand Dollar versus the US Dollar reached the given target at 0.6643, as predicted on Thursday. The currency pair was trading near a support cluster formed by the weekly and the monthly support levels during the following hours of today's trading session.

By and large, it is likely that the support cluster as mentioned earlier hold within this session.

However, if the currency exchange rate breaks the support cluster, the pair could end this week's trading session on bears market.

• ECB pledges more stimulus but euro bounces back from 2-year lows as no change this month disappoints
• US dollar climbs to 2-month highs as odds of 50-bps cut fade on solid US data
• Pound heads back down again after EU rejects Johnson's request to renegotiate backstop

Euro off lows but subdued

The euro was steadier on Friday following yesterday's volatility in response to the European Central Bank's highly anticipated monetary policy meeting. The ECB kept policy unchanged on Thursday, though some had expected a rate cut, leading the single currency to briefly surge higher before tumbling to a more than two-year low of $1.1100.

The ECB updated its statement to signal a rate cut as well as other policy changes, indicating all options are on the table. President Mario Draghi underlined the Bank's dovish tone in his press conference, but markets reacted negatively to suggestions that yesterday's decision on the revised forward guidance was not unanimous and that there was no discussion about taking any action at the meeting.

Draghi's comments also helped German bund yields to bounce back from lows, lifting the 10-year yield from a new record low of -0.422% to above -0.40%, as some investors doubted how far the ECB will go with its pledge. Still, with policymakers pretty much confirming that significant policy easing is on the way, any upside for Eurozone government bond yields, hence, the euro, is likely to be limited and temporary.

Dollar looks to Q2 GDP before attention turns to Fed

The euro's rebound helped the dollar index ease from two-month highs, though not by much. However, the greenback's new-found strength has not been limited to the euro. Declining expectations of an aggressive 50 basis points cut by the Federal Reserve next week have driven the dollar back above 108.50 yen, while the Australian and New Zealand dollars have slumped to two-week lows as investors bet that both the RBA and RBNZ will cut rates further this year.

Stronger-than-expected data out of the United States also supported the dollar. Durable goods orders jumped by 2% over the month in June, beating forecasts of 0.7% and offsetting some of the recent softer data on the manufacturing sector.

But the main focus later today will be on the advance GDP report for the second quarter, which is expected to show US economic growth slowing from an annualized rate of 3.1% to 1.8%. The data is unlikely to affect the Fed's decision to slash rates by at least 25bps next week, however, any underlying weakness in consumption or prices in the report could heighten expectations of additional rate cuts beyond July.

Pound hits a Brexit wall, reverses back down

The pound is once again looking at risk of breaching the $1.24 level as new UK prime minister, Boris Johnson's Brexit plan failed to impress the European Union. EU Commission President Jean-Claude Juncker reiterated the bloc's stance that the Withdrawal Agreement is not up for renegotiation and the only amendments that can be made are to the political declaration on the future relationship.

However, Johnson is not likely to back down as he insists the terms of the current deal “are unacceptable to this parliament and to this country”. The prospect of a fresh standoff between London and Brussels in the coming weeks does not bode well for sterling as a Johnson government is more likely to make good on its threat of a no-deal Brexit than May's administration.

Twitter stock lunged up out of a trading range that lasted around nine months, trying to fill the gap from July 26 of 2018. The move had price hit a nine-and-a-half month high of 40.90 to only fall back into a two-and-a half month sideways market, where the price is currently shaking hands with the upper boundary.

Price has printed a red candle, besides a bullish cross up of the 40-day simple moving average (SMA) by the 20-day SMA. Helping the move up is the 100-SMA currently moving parallel with the uptrend line. The MACD, although above its trigger, is flat, whereas the RSI is in the positive area slightly pointing to neutral areas. The ADX shows a missing trend.

With an upwards scenario, initially price would retreat to the 23.6% Fibonacci of the up-leg from 26.22 to 40.90, of 37.31, before finding the 20- and 40-day SMAs. It may pull back even further to test the 100-SMA coupled with the uptrend line, before it violates the upper boundary of 39.13 to test the high of 40.90. If fractured and the gap is filled, a 161.8% Fibo of the down move from 40.90 to 34, of 44.93 could unfold.

Negatively, a lot of congestion is within the range.

Summarizing, the short-term view seems neutral to bullish, whereas traders need to be cautious of a break below 34 and the near 200-SMA to turn the bias bearish.

The EUR/USD currency pair

Technical indicators of the currency pair:

Prev Open: 1.11408
Open: 1.11461
% chg. over the last day: +0.04
Day's range: 1.11424 – 1.11509
52 wk range: 1.1111 – 1.2009

Yesterday, EUR/USD had high trading activity and volatility were observed. The ECB, as expected, kept the main parameters of monetary policy at the same level. The trading instrument retreated from two-month lows, disappointing some market participants who made a weakening bet. The head of the Central Bank, Mario Draghi, said that the interest rates would remain at or below the level until at least the end of the first half of 2020. At the moment, the EUR/USD quotes are consolidating in the range of 1.11300-1.11550. Today, investors will evaluate important statistics from the United States. Positions must be opened from these marks.

At 15:30 (GMT+3:00) the US will publish a GDP report.

Indicators do not give accurate signals: the price crossed 50 MA and 100 MA.

The MACD histogram is near 0.

The Stochastic Oscillator is in the neutral zone, the %K line crossed the %D line. There are no signals at the moment.

Trading recommendations

Support levels: 1.11300, 1.11000
Resistance levels: 1.11550, 1.11850, 1.12100

If the price consolidates below 1.11300, expect a further devline toward 1.11000-1.10800.

Alternatively, the quotes can correct toward 1.12000.

The GBP/USD currency pair

Technical indicators of the currency pair:

Prev Open: 1.24828
Open: 1.24440
% chg. over the last day:-0.24
Day's range: 1.24257 - 1.24596
52 wk range: 1.2397 - 1.3385

The bearish mood prevails on the GBP/USD currency pair. During yesterday's and today's trading, the drop in quotes exceeded 50 points. The pound has updated local lows. At the moment, the key range is 1.24200-1.24550. GBP/USD quotes have the potential to further decline. Investors are concerned about the “tough” Brexit scenario. Today, financial market participants will evaluate the US GDP report. We recommend to open positions from key levels.

The news background on the UK economy is calm.

Indicators of accurate signals do not give: 50 MA crossed 100 MA.

The MACD histogram is in the negative zone and continues to decline, indicating a drop in GBP/USD quotes.

The Stochastic Oscillator is in the oversold zone, the %K line crossed the %D line. There are no signals at the moment.

Trading recommendations

Support levels: 1.24200, 1.23850
Resistance levels: 1.24550, 1.24900, 1.25200

If the price consolidates below 1.24200, expect a further descend toward 1.23850-1.23600.

Alternatively, the price will grow toward 1.24800-1.25000.

The USD/CAD currency pair

Technical indicators of the currency pair:

Prev Open: 1.31395
Open: 1.31556
% chg. over the last day: +0.14
Day's range: 1.31528 - 1.31683
52 wk range: 1.2727 - 1.3664

The USD/CAD currency pair has once again shifted to growth. CAD updated local maxima. At the moment, the USD/CAD quotes are consolidating near the resistance level of 1.31700. 1.31450 is already a "mirror" support. Trading instrument has the potential for further growth. Financial market participants expect a report on US GDP. We also recommend to pay attention to the dynamics of oil prices. Positions must be opened from key levels.

The Economic News Feed for 26.07.2019 is calm.

Indicators indicate the strength of buyers: the price has fixed above 50 MA and 100 MA.

The MACD histogram is in the positive zone and continues to rise, which signals a further increase in the USD/CAD quotes.

The Stochastic Oscillator is in the neutral zone, the %K line is above the %D line, which also indicates bullish moods.

Trading recommendations

Support levels: 1.31450, 1.31200, 1.30950
Resistance levels: 1.31700, 1.32000

If the price fixes above 1.31700, expect further growth toward 1.32000-1.32200.

Alternatively, the price will drop toward 1.31200-1.31000.

The USD/JPY currency pair

Technical indicators of the currency pair:

Prev Open: 108.177
Open: 108.648
% chg. over the last day: +0.45
Day's range: 108.561 - 108.742
52 wk range: 104.97 - 114.56

The USD/JPY currency pair shows a positive trend. Trading tool updated key extremes. At the moment, the USD/JPY quotes are consolidating. Local levels of support and resistance are: 108.500 and 108.750, respectively. We expect statistics on US GDP. We also recommend tracking up-to-date information regarding trade negotiations between the US and China. USD/JPY quotes have the potential for further growth. Positions must be opened from key levels.

The Economic News Feed for 26.07.2019 is calm.

The price has fixed above 50 MA and 100 MA, which indicates the strength of buyers.

The MACD histogram is located in the positive zone, but below the signal line, which gives a weak signal to buy USD/JPY.

The Stochastic Oscillator is in the neutral zone, the% K line is above the% D line, which also gives a signal to buy USD/JPY.

Trading recommendations

Support levels: 108.500, 108.250, 108.000
Resistance levels: 108.750, 109.000

If the price consolidates above the level of 108.750, expect further growth toward 109.000-109.200.

Alternatively, the quotes can descend toward 108.300-108.100.

EUR/USD

Current level - 1.1143

After breaking  the support of 1.1120 and reaching even 1.110, the currency pair  went  back up, showing that these levels are important for the future trend. Breaking through 1.110 again  would push the price down to the 1.0900 zone. Alternatively, a movement up to 1.1180 would show some positive trend for the euro. 

USD/JPY

Current level - 108.17

The successful  break up of 108.35 level is keeping the positive trend and could  push the price higher to test the 109.10 zone. In the opposite direction now the support level is at 108.30.

GBP/USD

Current level - 1.2445

Possible test of  the key support zone at 1.2429.  The  resistant level  is at 1.2519.

Thursday was the so-called "ECB Day." Mario Draghi held a press-conference, voicing a readiness to lower the rate and apply other monetary easing measures. The ECB is not in a hurry to cut rates, preferring to wait for the updated forecasts. However, it has given a clear signal that the next step will involve policy easing.

The Euro fell to 1.11001 after the ECB posted a comment on the rate, but on the decline to 26-month lows, EURUSD received support, managing to jump to 1.1170 at the time of writing.

It is worth noting that Draghi's comments indicated a willingness to soften policy, as well as noting the deterioration of economic forecasts. Also, in his speech, the ECB President said that the risks are tilted downwards and the chances of a recovery of growth and inflation in the second half of the year are declining.

Markets sold the Euro throughout the week, as bond yields declined, with the chances of a rate cut growing to 50% on Thursday, prior to Draghi’s ECB speech. Without meeting these expectations, the single currency rebounded from the round level of 1.1100, as it did before in April and May.

Much of the future dynamics of EURUSD will depend on the Fed's comments next Wednesday, as investors will compare the tone of the two influential central banks to act. The current rebound of the Euro is like one that has touched the important level, while the decisive attitude of the ECB to soften policy and launch QE suggests the development of a trend to reduce the Euro against the dollar, after a short period of waiting for the Fed's comments – set to be made next Wednesday.

In addition to the global unknowns in the form of the world monetary policy, stock markets are now influenced by earnings reports. In general, up to date they are mostly "good", but within the sectors there is a division. IT-giants like Alphabet, Facebook and Intel are exceeding expectations, while those close to production and retail sales, such as Ford and Tesla, saw a notable decline.

Amazon is traditionally considered to be IT company – rather than an online retailer – but its abundant investments in marketing and online delivery have negatively affected profits. The weakness of the retail and manufacturing sectors is an alarming signal for the economy. Exactly how deep this deceleration will turn out to be, we will discover today, after the first estimate of US GDP for the second quarter.

Despite heightened geopolitical tensions in the Middle East, oil prices remained unchanged yesterday. Following a poor EIA inventories report on Thursday and news that Saudi is going to boost crude pipeline capacity, earlier gains from central bank language were offset. Monetary stimulus, however, could help the oil in the medium term. This is provided industrial demand remains of course at par levels.

US Oil Rangebound But Close to Breaking

Demand for oil saw a slide at the 57.66 high on early Thursday, where prices reversed course and headed towards to the bottom of the tight 57.66-56.05 range. Given the current state of economies and rejection by the 50% Stochastic level, should the descending channel keep prices under pressure oil could soon reach the 54.83 level.

Although the dollar was taking a beating against a strong euro during and a little after Draghi's speech, the sugar rush did little to hold USDJPY low. Core durable goods and jobless claims came out better than expected at 1.2% and 206K. The two economic releases were expected at 0.1% and 218K respectively, pummelling expectations. Safe- haven outflows supported the currency pair to break to a fresh July high

Will Dollar Give Up Its Gains?

The USDJPY high of 108.75 was reached after bulls pushed prices above the 108.60 July- high resistance. Trading within an ascending channel, chances of further upside towards 109 remain elevated. However, the 108.28 support must remain firm should prices start a decline in the short-term.

Expectations of a Thursday rate cut on the back of an array of poor economic data in Germany, France and also in the wider euro area sent the euro lower. The soft patch of releases had investors thinking EURUSD will break the 1.11 psychological level and reach fresh lows. However, the ECB opted to keep rates on hold, supporting the beleaguered currency.

Will the 1.11 Support Hold Firm?

A false break below the strong 1.1116 bottom formed as Draghi dialed back on his dovish tone. This reversed the course for EURUSD. The rejection near the June low of 1.1181 came following a bounce from the 50% Stochastic indicator and as bulls started taking profits. As a result, the pair ended the session with a daily Doji bar, and that increases the chances of a bullish reversal.

The Euro is holding within narrow range above new 2019 low in early Friday's trading, after Thursday's post-ECB roller-coaster action ended in long-legged Doji candle, signaling strong indecision at key 1.11 support zone.

The ECB kept interest rates unchanged and Mario Draghi sounded less dovish that some market participants expected, preventing larger bears to eventually break below 1.11 pivot.

The European central bank didn't want to rush with cutting rates and joining global easing trend, but looking for the outcome of Fed policy meeting next week and awaiting more news from US/China trade talks.

Technical outlook remains negative despite Thursday's wide range and Doji candle, as underlying bear-trend stays intact and daily/weekly techs are in negative setup.

Extended consolidation within 1.1100/1.1200 range can be anticipated before fresh push lower, with firm break below 1.11 zone, expected to open way towards psychological 1.10 support.

Former consolidation lows and broken H&S pattern neckline at 1.12 zone are reinforced by falling 10SMA and mark solid barrier, which is expected to cap consolidation and keep larger bears in play. Key event today is release of US GDP data, which are expected to show US growth slowed in Q2 to 1.8% from 3.1% in Q1, which may increase pressure on dollar, however, traders will look for the outcome of Q2 consumer spending for more evidence about the strength of the economy.

Res: 1.1150, 1.1181, 1.1200, 1.1223
Sup: 1.1126, 1.1101, 1.1050, 1.1019