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The Australian Dollar has been weakening against the Swiss Franc in a steep descending pattern. This movement has been bounded by a one month channel down.

The AUD/CHF currency pair has been moving sideways since June 19, bouncing between the 55-hour simple moving average to the south and the 100-hour SMA to the north.

Technical indicators flash strong buy signals on the four-hour time frame. Nevertheless, some downward potential is still apparent in the market during the following trading sessions.

The Common European currency has appreciated substantially against the New Zealand Dollar during the past month. This bullish momentum has pressured the currency pair higher toward an eight-month high at 1.7377.

After reaching the monthly pivot point near the 1.73 mark, the exchange rate made a corrective move south. However, the pair is still maintaining the ascending channel pattern at the time of this analysis.

As for near future, the EUR/NZD currency exchange rate is likely going to continue moving north during the following trading sessions until the pair breached the aforementioned monthly resistance level near the 1.73 regions.

On Thursday there are new notable updates to the situation on the EUR/USD hourly chart.

The pair has revealed a medium term ascending channel pattern, which is set to guide the currency exchange rate during July. It was noticed after the currency exchange rate bounced off the combined support of various levels of significance near the 1.1650 mark.

Secondly, the rate has surged above the PP near the 1.1680 mark. Due to that reason the pair faces no resistance up to the 1.1760 mark, where the next resistance levels are located at.

The Pound has extended its gains against the US Dollar on Thursday. Moreover, the rate has managed to pass the resistance of the PP at 1.3247.

Due to that reason the currency exchange rate will face no resistance, as it surges up to the levels of significance near the 1.3220 mark. Near that level a R1 level together with the upper trend lines of the junior, medium and long teRm patterns. Coincidentally, just above the R1 all of the mentioned trend lines meet.

However, for a surge the rate is set to need support. It could be provided by the 55-hour SMA, lower trend line of the junior pattern and the PP at 1.3247.

It was already speculated on Wednesday that there should exist a long term ascending pattern dominant to the junior downwards aimed channel on the USD/JPY chart. That pattern was revealed on Thursday.

Namely, as the rate rebounded against the support of the 200-hour simple moving average, the event provided a reference point for the dominant ascending pattern.

The rebounded resulted in a surge, which passed the 55-hour SMA only to be stopped by the 100-hour SMA. If the 100-hour SMA at 110.67 gets properly passed, the rate will face no resistance. However, a new short term pattern should reveal itself in the near future

After the sudden surge on Tuesday, a full review of the yellow metal's charts has been conducted on Thursday.

Basically, the commodity price is surging in a medium term pattern in the borders of a larger dominant descending pattern. However, the medium term pattern is most likely representing the junior move in another larger pattern.

Meanwhile, not that the price was at a crossroad during the review. Namely, it was about to either confirm or break the speculated medium pattern near the 1,251.00 mark.

Notes/Observations

• Inflation remains tame for Switzerland and Taiwan
• UK Brexit Secretary Davis rejects UK PM May’s new Brexit plan

Asia:

• Asian equities decline as investors fear first round of tariffs
• China reiterated they will not implement tariffs before the US on Friday

Europe:

• European Automakers rise on German press reports the US ambassador to Germany has told Automaker Execs that it would suspend threats of tariffs on cars imported from EU if the EU lifted duties on US cars
• IMF cuts 2018 German Growth forecasts, lifts 2019 outlook
• Some ECB members are uneasy that investors are not pricing an interest rate hike until Dec 2019; a move in Sept or Oct is on the cards although any decision on rates will depend on economic outlook
• Brexit Secretary David Davis rejects PM May's new Brexit plan (had proposed customs compromise)

Economic Data:

• (DE) Germany May Factory orders M/M: 2.6% V 1.1%E; Y/Y: 4.4% V 1.7%E (surging more than twice as forecast)
• (ES) Spain Jun Industrial Output NSA Y/Y: 1.6% v 11.2% prior; Industrial Output SA Y/Y: 1.6% v 1.7%e
• (DE) Germany Jun Construction PMI: 53.0 v 53.9 prior
• (CH) Swiss Jun CPI M/M: 0.0% V 0.1%E; Y/Y: 1.1% V 1.1%E
• (SE) Sweden May Private Sector Production M/M: 1.1% v 0.3%e; Y/Y: 4.0% v 2.7%e
• (UK) Jun New Car Registrations Y/Y: -3.5% v +3.4% prior
• (TW) Taiwan Jun CPI Y/Y: 1.3% v 1.5%e; CPI Core Y/Y: 1.30% v 1.0% prior
• UN FAO World Food Price Index: 173.7 v 176.2 prior
• (EU) Euro Zone Jun Retail PMI: 51.8 v 51.7 prior

Fixed Income Issuance:

• (ES) Spain Debt Agency (TESORO) sells total €3.84B VS €3.5-4.5B indicated range in 2021, 2030 2041 SPGB bonds
• (ES) Spain Debt Agency (Tesoro) sells €920M v €0.5-1.0B indicated range in 0.65% inflation-linked 2027 bond (SPGBei); Real Yield: -0.154% v -0.297%
• (FR) France Debt Agency (AFT) sells total €8.0B VS €7.0-8.0B indicated ranged in 2028, 2031 AND 2034 Oats

SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM

Equities

• Indices [Stoxx50 +0.7% at 3,436, FTSE +0.3% at 7,593, DAX +1.1% at 12,448, CAC-40 +0.7% at 5,357; IBEX-35 +0.9% at 9,847, FTSE MIB +1.1% at 21,928, SMI +0.3% at 8,692, S&P 500 Futures +0.4%]
• Market Focal Points/Key Themes: European stocks open slightly higher and maintained the trend as the session progressed; consumer discretionary underperforming; risk sentiment supported over hopes of resolving trade issues; materials and financials better performers; Czechia and Slovakia closed for holiday; car makers supported after US reportedly offered to suspend tariffs; Venezuela closed for holiday; earnings expected in the upcoming US session include Xplore Technologies and International Speedway

Equities

• Consumer discretionary: Associated British Foods ABF.UK -4.2% (results), Electrocomponents ECM.UK +3.1% (trading update), FNAC Darty FNAC.FR +5.1% (analyst action), Juventus JUVE.IT +7.6%(contracting Cristiano Ronaldo), Sodexo +5.8% SW.FR (results)
• Energy: SBM Offshore SBMO.NL -6.5% (Brazil court orders Petrobras to withhold payments)
• Financials: Generali G.IT +2.1% (asset sale)
• Industrials: Linde LIN.DE +1.5% (Praxair transation)
• Materials: Glencore GLEN.UK +3.9% (share buyback)
• Technology: Roodmicrotec ROOD.NL +6.8% (results)

Speakers

• (EU) ECB's Praet (Belgium, chief economist) Reiterates expectation is that policy rates will remain at their present levels at least through the summer of 2019 (in-line with July 3rd speech)

Currencies

• EUR/USD firmed up as market pricing for an October 2019 ECB rate hike and speculation about supportive M&A flows. The pair pushes towards 1.17 as momentum continues.

Fixed Income

• Bund Futures trade 25 ticks lower at 162.19 on conviction that ECB may raise rates sooner. Upside targets 163.25 followed by 163.85, while a return lower targets the 159.75 level.
• Gilt futures trade at 122.90 lower 13 ticks following the move in Treasuries. Support continues stands at 121.75 then 120.25, with upside resistance at 123.85 then 124.25.
• Thursday's liquidity report showed Wednesday's excess liquidity rose from €1.847T to €1.852T. Use of the marginal lending facility climbed from €0M to €50M.
• Corporate issuance saw no deals priced in the primary market

Looking Ahead

• 07:30 (US) Jun Challenger Job Cuts Y/Y: No est v -4.8% prior
• 08:05 (UK) Baltic Dry Bulk Index
• 08:15 (US) Jun ADP Employment Change: No est v 178K prior
• 08:30 (CL) Chile May Economic Activity (monthly GDP) M/M: No est v -0.4% prior; Y/Y: No est v 5.9% prior
• 08:30 (US) Initial Jobless Claims: No est v 227K prior; Continuing Claims: No est v 1.705M prior
• 09:00 (CL) Chile May Nominal Wage M/M: No est v 0.1% prior; Y/Y: No est v 3.0% prior
• 09:00 (MX) Mexico Jun Consumer Confidence: No est v 88.3 prior
• 09:00 (MX) Mexico Apr Gross Fixed Investment: No est v -4.1% prior
• 09:00 (RU) Russia Gold and Forex Reserve w/e Jun 29th: No est v $456.3B prior
• 09:45 (US) Jun Final Markit Services PMI: No est v 56.5 prelim, Composite PMI: No est v 56.0 prelim
• 10:00 (MX) Mexico Central Bank (Banxico) Jun Minutes
• 10:00 (US) Jun ISM Non-Manufacturing Composite: No est v 58.6prior
• 11:00 (US) Weekly DOE Crude Oil Inventories
• 14:00 (US) FOMC Minutes from Jun 13th Meeting
• 15:00 (MX) Mexico Citibanamex Survey of Economists

Entering into US session, Euro is trading as the strongest one for today. It's partly lifted as delayed reaction to news that some ECB policy makers are unhappy with market pricing of too slow rate path. Euro could also be following stocks and yields higher on news that Trump is offering a zero auto tariffs solution for trade dispute. At the time of writing, DAX is up 1.5%, CAC is up 1.2%, FTSE is up 0.56%. 10 year German bund yield is up 0.0153 to 0.321.

Sterling follows as the second strongest as supported by comments from BoE Governor Mark Carney. He reiterated that recent data pointed to Q1's slowdown as being temporary. And the economic developments are broadly in line with the May projections. That gives a little more support for the chance of an August rate hike. Meanwhile, Yen is trading broadly lower as risk aversion eased, followed by Dollar as the second weakest.

We'd like to point out that from Action Bias tables, there is no overwhelming momentum in the markets yet. Euro could be having a relatively strong near term corrective up move against Dollar and Yen only and it's just neutral against Sterling, Swiss and Australian Dollar. Similar picture is seen in Yen crosses.

The euro has broken above the 1.1674 level against the US dollar during the European trading session, after better than expected German economic data. The EURUSD pair has so far been capped by the 1.1710 resistance level, with price falling just short of the key 1.1719 level. Buyers will now try to break the 1.1719 resistance level, while sellers will try to once again contain price below the 1.1674 level.

The EURUSD pair is bullish while trading above the 1.1674 level, key resistance is now found at the 1.1719 and 1.1800 levels.

If the EURUSD pair moves below the 1.1674 level, key technical support is now found at the 1.1650 and 1.1630 levels.

The US dollar has started to move higher against the Japanese yen, after sellers failed to contain price below the 110.46 support level. The USDJPY pair may start to trade back towards the 111.00 level, with price-action currently suggesting a weak corrective-move is underway. Traders now await the release of key jobs data from the United States economy and the FOMC Meeting Minutes later today.

The USDJPY pair is only bullish while trading above the 110.46 level, further upside towards the 110.80 and 111.00 levels remains possible.

If the USDJPY pair trades below the 110.46 level, sellers will likely test the 110.25 and 110.00 support levels.