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Eurozone Sentix Investor Confidence improved slightly from -26.4 to -25.2 in August, better than expectation of -26.3. Current Situation index ticked up from -16.5 to -16.3. Expectations index also edged up from -35.8 to -33.8.

However, Germany Investor Confidence dropped from -24.2 to -24.4, lowest since May 2020. Current Situation index dropped from -13.0 to -14.8, lowest since February 2021. Expectations index, on the other hand, ticked up from -34.8 to -33.5.

Sentix said, the improvement in Eurozone "does not mean that the all-clear has been given". And, "a recession in the Eurozone is still very likely."

Full release here.

EUR/USD

Last week, the single European currency ended with strong bearish pressure. After the announcement of the non-farm payroll numbers on Friday, the bears managed to breach the key support at 1.0210. Their attempt to reach the next one at 1.0125, however, was limited. Today, the bears once again put pressure on the market, and at the time of writing, they managed to record a move of about 10 pips in their favour. If the bulls manage to recover their positions, then they will have to deal with the next resistance at 1.0269. It seems that this week will be calm in terms of macroeconomic news, with the only news that could potentially influence the currency pair being the U.S. consumer price index data on Wednesday at 12:30 GMT.

USD/JPY

The dollar managed to assert itself even more strongly in the "land of the rising sun" at the end of last week. The bulls managed to overtake the resistance at 134.60 and are now headed for the next one at 135.72. If the bears manage to recover their lost positions, then they will have to deal with the support at 132.52 as well.

GBP/USD

After the release of the non-farm payroll numbers last Friday, not even the pound was able to buck the dollar's momentum. The bears broke through the support at 1.2100 and made an unsuccessful attempt to breach the next one at 1.2020. If the bulls manage to resist the pressure, then they would have to deal with the resistances at 1.2100 and at 1.2186, respectively.

EUGERMANY40

The German index continues to trade in the narrow range between the levels of 13507 and 13720, however neither the bears, nor the bulls are currently managing to gain momentum. No macroeconomic news that would cause sharp changes in the index is expected during this week. If the bears manage to strengthen the sell-offs and break away from the range-bound trading, then they could test the next support at 13339.

US30

In the last 10 days, the U.S. blue-chip index consolidated in a range between the levels of 32580 – 32910. During this period of consolidation, the bears made several attempts to breach the lower boundary of the range, but failed to hold onto their positions. If their third attempt is successful, then bearish investors could try to increase the sell-offs down to the psychological support of 32000.

Stock markets fall as a robust US labour market may stir up the Fed’s hawkishness. The rising trendline is a sign of improved sentiment and a close above 13650 at the tip of a faded rebound in mid-June indicates a strong bullish bias. However, the RSI’s repeated overbought situation signals an overextension and could cause a pullback. 13550 on the trendline is the first support and 13330 could test buyers’ commitment. A bounce above 13780 may attract more momentum buying, sending the Dax towards 14050.

The Canadian dollar softened after weaker-than-expected jobs data. The US dollar has been resilient despite its break below the daily support at 1.2480. This suggests that the pair is still in a consolidation phase. 1.2770 saw strong buying interest and a close above 1.2900 on the 30-day moving average prompted sellers to cover their bets, easing the downward pressure. A break above 1.3000 may help the bulls regain control, paving the way for a rally towards 1.3200. The former resistance at 1.2880 has become a fresh support.

The US dollar surged after July’s nonfarm payrolls more than doubled the market’s expectations. Multiple tests of the demand zone around 1.0100 suggests solid interest in keeping the rebound intact. 1.0290 next to the 30-day moving average is a key hurdle ahead. A bullish breakout would put the single currency back on track as short-term sellers capitulate. Then 1.0450 at the start of the July sell-off would be the next target. However, a fall below the said support could send the pair back to parity, putting the recovery at risk.

Daily Pivots: (S1) 1.2871; (P) 1.2928; (R1) 1.2994; More...

Intraday bias in USD/CAD stays mildly on the upside at this point. Pull back from 1.322 could have completed at 1.2766 already. Further rise would be seen back to retest 1.3222 high. On the downside, however, break of 1.2817 minor support will suggest that the fall from 1.3222 is resuming through 1.2766.

In the bigger picture, down trend from 1.4667 (2020 high) should have completed at 1.2005, after defending 1.2061 long term cluster support. Rise from there should target 61.8% retracement of 1.4667 to 1.2005 (2021 low) at 1.3650. This will remain the favored case now as long as 1.2516 support holds.

Daily Pivots: (S1) 0.6863; (P) 0.6919; (R1) 0.6968; More...

Intraday bias in AUD/USD remains neutral for the moment. On the upside, break of 0.7045 will resume the rebound from 0.6680 to 0.7282 key resistance next. On the downside, however, break of 0.6858 minor support will argue that the rebound is over. Intraday bias will then be back on the downside for retesting 0.6680 low.

In the bigger picture, price actions from 0.8006 (2021 high) is seen more as a corrective pattern to rise from 0.5506 (2020 low). Or it could be a bearish impulsive move. In either case, outlook will remain bearish as long as 0.7282 resistance holds. Next target is 61.8% retracement of 0.5506 to 0.8006 at 0.6461.

Daily Pivots: (S1) 1.0130; (P) 1.0191; (R1) 1.0240; More...

Range trading continues in EUR/USD and intraday bias stays neutral. On the downside, break of 1.0095 minor support will argue that larger down trend is ready to resume. Intraday bias will be back to the downside for retesting 0.9951 low first. For now, outlook will stay bearish as long as 1.0348 support turned resistance holds, even in case of another rise.

In the bigger picture, down trend from 1.6039 (2008 high) is still in progress. Next target is 100% projection of 1.3993 to 1.0339 from 1.2348 at 0.8694. In any case, outlook will stay bearish as long as 1.0773 resistance holds, in case of strong rebound.

Daily Pivots: (S1) 1.1993; (P) 1.2081; (R1) 1.2158; More...

Intraday bias in GBP/USD remains on the downside for the moment. Rebound from 1.1759 should have completed after hitting 55 day EMA. Deeper fall would be seen back to retest 1.1759 low. On the upside, break of 1.2292 will resume the rebound towards 1.2405 resistance instead.

In the bigger picture, fall from 1.4248 (2018 high) could be a leg inside the pattern from 1.1409 (2020 low), or resuming the longer term down trend. Deeper decline is expected as long as 1.2666 resistance holds. Next target is 1.1409 low. However, firm break of 1.2666 will bring stronger rise back to 55 week EMA (now at 1.2925).

Daily Pivots: (S1) 133.21; (P) 134.36; (R1) 136.18; More...

Intraday bias in USD/JPY remains mildly on the upside, as rebound from 130.38 is in progress. Further rally would be seen to retest 139.37 high. Strong resistance could be seen there to limit upside, to bring another fall, as the third leg of the consolidation pattern from 139.37. On the downside, below 132.50 minor support will resume the fall from 139.37 towards 126.35 structural support.

In the bigger picture, fall from 139.37 medium term top is seen as correcting whole up trend from 101.18 (2020 low). While deeper decline cannot be ruled out, outlook will stays bullish as long as 55 week EMA (now at 121.84) holds. Long term up trend is expected to resume through 139.37 at a later stage, after the correction finishes.