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Daily Pivots: (S1) 0.8911; (P) 0.8924; (R1) 0.8939; More...

EUR/GBP is staying in consolidation below 0.8957 temporary top and intraday bias remains neutral. As long as 0.8815 support holds, further rally is expected in the cross. Sustained break of 0.8967 cluster resistance (50% retracement of 0.9305 to 0.8620 at 0.8963) should confirm completion of whole decline from 0.9305. EUR/GBP should then target 61.8% retracement at 0.9043 next.

In the bigger picture, EUR/GBP is staying in long term range pattern from 0.9304 (2016 high). The corrective structure of the fall from 0.9305 to 0.8620 is raising the chance that rise from 0.8312 to 0.9305 is an impulsive move. But we're not too confident on it yet. In any case, we'd stay cautious on strong resistance from 0.9304/5 to limit upside in case of further rally. Meanwhile, if there is another medium term decline, strong support will likely be seen from 0.8303 to contain downside.

Daily Pivots: (S1) 1.5757; (P) 1.5825; (R1) 1.5868; More....

Intraday bias in EUR/AUD remains neutral for the moment. With 1.5651 minor support intact, rise from 1.5271 is likely still in progress. On the upside, break of 1.5888 resistance will extend the rally towards 1.6139/89 resistance zone. However, break of 1.5651 cluster support (38.2% retracement of 1.5271 to 1.5886 at 1.5651) will indicate near term reversal and turn bias back to the downside for 1.5271.

In the bigger picture, current development suggests that fall from 1.6189 is a corrective move and has completed at 1.5271 already. Key support levels of 1.5153 and 38.2% retracement of 1.3624 to 1.6189 at 1.5209 were defended. And medium term rise from 1.3624 (2017 low) is still in progress. Break of 1.6189 will target 1.6587 key resistance (2015 high).

Daily Pivots: (S1) 1.1592; (P) 1.1619; (R1) 1.1635; More...

We're holding on to the view that corrective rebound from 1.1366 has completed with three waves up to 1.1713 already. Intraday bias in EUR/CHF stays on the downside for 1.1478 support. Break there should resume the whole decline from 1.2004 through 1.1366 low. On the upside, above 1.1653 minor resistance will bring another rise. But in the case, we'd continue to expect strong resistance from 61.8% retracement of 1.2004 to 1.1366 at 1.1760 to bring near term reversal.

In the bigger picture, 1.2004 is seen as a medium term top with bearish divergence condition in daily and weekly MACD. 1.2000 is also an important resistance level. Hence, the corrective pattern from 1.2004 is expected to extend for a while before completion. We're not anticipating a break of 1.2004 in near term. Another decline cannot be ruled out yet. But in that case, strong support should be seen at 1.1198 (2016 high), 61.8% retracement of 1.0629 to 1.2004 at 1.1154 to contain downside.

Daily Pivots: (S1) 1.1664; (P) 1.1708 (R1) 1.1734; More.....

Intraday bias in EUR/USD remains neutral and outlook is unchanged. Consolidation from 1.1509 could extend and stronger rise cannot be ruled out. But upside should be limited by 1.1851 resistance to bring fall resumption eventually. On the downside , firm break of 1.1507 will resume larger down trend through 50% retracement of 1.0339 to 1.2555 at 1.1447.

In the bigger picture, EUR/USD was rejected by 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516. And, a medium term top was formed at 1.2555 already. Decline from there should extend further to 61.8% retracement of 1.0339 to 1.2555 at 1.1186 and below. For now, even in case of rebound, we won't consider the fall from 1.2555 as finished as long as 1.1995 resistance holds.

Daily Pivots: (S1) 1.3069; (P) 1.3114; (R1) 1.3145; More...

GBP/USD was rejected by 4 hour 55 EMA and retreated. But it's staying in consolidation from 1.2956. Intraday bias stays neutral first. In case of another rise, upside should be limited below 1.3362 resistance to bring fall resumption eventually. On the downside, break of 1.2956 will resume the decline from 1.4376 to 1.2874 fibonacci level.

In the bigger picture, whole medium term rebound from 1.1946 (2016 low) should have completed at 1.4376 already, after rejection from 55 month EMA (now at 1.4179). Fall from 1.4376 should extend to 61.8% retracement of 1.1946 (2016 low) to 1.4376 at 1.2874 next. Decisive break of 1.2874 will raise the chance of long term down trend resumption through 1.1946 low. On the upside, break of 1.3362 resistance is needed to be the first indication of medium term bottoming. Otherwise, outlook will remain bearish even in case of strong rebound.

Daily Pivots: (S1) 0.9905; (P) 0.9924; (R1) 0.9947; More...

Intraday bias in USD/CHF is turned neutral with 4 hour MACD crossed above signal line. Another fall is mildly in favor as long as 0.9957 minor resistance holds. Below 0.9900 will target 0.9856 support. Break there will pave the way to key support level at 0.9787. On the upside, above 0.9957 minor resistance will turn bias back to the upside for retesting 1.0067.

In the bigger picture, as long as 0.9787 support holds, we're still favoring the bullish case. That is, rise fro 0.9787 is resuming the whole up trend from 0.9186 and should target 1.0342 key resistance on resumption. However, break of 0.9787 will indicate medium term reversal and turn outlook bearish.

Daily Pivots: (S1) 110.89; (P) 111.22; (R1) 111.68; More...

A temporary low is formed at 110.74 after breaching 111.50 minor resistance. Intraday bias in USD/JPY is turned neutral first. The corrective pattern from 113.17 short term top could extend with another decline. Below 110.74 will bring another fall. But in that case, downside should be contained by 38.2% retracement of 104.62 to 113.17 at 109.90 to bring rebound.

In the bigger picture, corrective fall from 118.65 (2016 high) should have completed with three waves down to 104.62. Decisive break of 114.73 resistance will likely resume whole rally from 98.97 (2016 low) to 100% projection of 98.97 to 118.65 from 104.62 at 124.30, which is reasonably close to 125.85 (2015 high). This will stay as the preferred case as long as 109.36 support holds.

Market movers today

It is time for euro area Flash PMI for July. PMI manufacturing has declined every month this year and we look for another small decline in the July reading from 54.9 to 54.4 as trade worries are expected to weigh on activity. However, the level for PMI is still clearly above the long-term average of 51.9. In the afternoon, we alongside consensus expect both the US manufacturing and Service PMIs to fall back slightly.

In Scandinavia, Statistics Norway are due to release the quarterly manufacturing confidence indicator. We look for a small rise in the manufacturing composite indicator (to 6.5-7.0) as we expect the impact of a higher oil price to dominate somewhat weaker global demand. In terms of the details, we will look out for new order composition. We do not expect the release to have any significant market impact.

The central banks of Turkey and Hungary both have rate announcements today, but both are expected to keep rates unchanged.

Markets will be awaiting Wednesday's meeting between US President Donald Trump and President of the EU Commission, Jean-Claude Juncker. Trump's threat to impose tariffs on autos has increased tensions. However, his economic adviser Larry Kudlow has hinted that the US is negotiating with the EU. Therefore, a deal may be coming.

Selected market news

Near-term market focus remains on the impact on global growth/monetary policy from trade wars, a worsening US-Iran relationship and the impact of higher bond yields amid speculation the Bank of Japan (BoJ) is contemplating fine tuning its yield curve control (higher yields).

In terms of the latter, the global fixed income sell-off gained momentum last night and 10Y UST jumped 6bps to 2.95%. The combination of positive risk sentiment and fears that the BoJ will scale back stimuli next week by changing the yield target weighed on sentiment. The US curve 2s10s steepened for the second consecutive day after it hit an 11-year low level on Friday at 24bp. It is currently at 33bp. However, we think the US curve steepening is premature. The Fed is still on track for two more rate hikes this year and a change in the BoJ yield control is far too early given a still weak Japanese inflation picture.

In FX markets, a recent USD/JPY decouple from 10Y rates spreads suggests investors have positioned for a possible policy twist from the BoJ at the 31 July meeting. We do not expect the BoJ to adjust its policy next week, however, and if we are right, it should have a positive impact on the JPY and Japanese FI market. We will send out a BoJ meeting preview in the coming days.

In China, the authorities continue to ease economic policy amid slowing housing/construction and, not least, Donald Trump threatening to impose further US tariffs on Chinese exports. Yesterday, the Chinese central bank injected USD74bn into the banking system – the largest ever using its ‘Medium-term Lending Facility' – and later the government announced new fiscal measures as fiscal policy is becoming ‘more proactive' and flexible to ‘external uncertainties'. Easier monetary policy has, in our view, been the key driver behind CNY weakness.

In Scandi FX, the SEK and not least the NOK erased most of their Monday gains as renewed support to USD crosses (incl. USD/Scandies) added downward pressure on to the oil price. That said, we still regard EUR/NOK and EUR/SEK to be near-term range plays.

Daily Pivots: (S1) 1.3131; (P) 1.3156; (R1) 1.3197; More...

With 4 hour MACD crossed above signal line, intraday bias in USD/CAD is turned neutral first. For now, the correction from 1.3385 is still in favor to continue. Below 1.3114 will target 1.3063 support and then 100% projection of 1.3385 to 1.3063 from 1.3289 at 1.2967. But we'd expect strong support from rising channel line (now at 1.2893) to contain downside and bring rebound. Larger rally from 1.2061 is expected to resume later.

In the bigger picture, as long as channel support (now at 1.2893) holds, we're holding to the bullish view. That is, fall from 1.4689 (2015 high) has completed at 1.2061, ahead of 50% retracement of 0.9406 (2011 low) to 1.4689 (2015 high) at 1.2048. Further rally should be seen for 61.8% retracement of 1.4689 to 1.2061 at 1.3685 and above. However, sustained break of the channel support will argue that rise from 1.2061 has completed and will bring deeper fall to 1.2526 support to confirm.

For the 24 hours to 23:00 GMT, the EUR declined 0.44% against the USD and closed at 1.1691.

Data indicated that Euro-zone's preliminary consumer confidence index dropped to -0.6 in July, less than market consensus for a drop to a level of -0.7 and marking its lowest level in nine months. In the previous month, the index had registered a reading of -0.5.

In the US, data showed that, US existing home sales unexpectedly fell 0.6% on monthly basis to a level of 5.38 million in June, for the third consecutive month and defying market expectations for a climb to a level of 5.44 million. In the preceding month, existing home sales recorded a revised reading of 5.41 million.

Meanwhile, the nation's Chicago Fed national activity index rebounded to a level of 0.43 in June, compared to a revised level of -0.45 in the previous month. Markets participants had expected the index to rise to a level of 0.25.

In the Asian session, at GMT0300, the pair is trading at 1.1688, with the EUR trading a tad lower against the USD from yesterday's close.

The pair is expected to find support at 1.1667, and a fall through could take it to the next support level of 1.1646. The pair is expected to find its first resistance at 1.1726, and a rise through could take it to the next resistance level of 1.1764.

Going forward, investors will keep an eye on the Markit manufacturing and services PMI for July, set to release across the euro bloc. Later in the day, the US house price index for May and the flash Markit manufacturing & services PMI for July, will garner significant amount of investor attention.

The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.