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Talking Points:

- EUR/USD Risks Larger Relief Bounce Ahead of Greek Vote, 2Q GDP Report.

- USD/CAD Fails to Preserve Bullish Momentum- Former Resistance Zones in Focus.

- USDOLLAR Threatens Range Support- Retail Sales to Rebound in July.

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EUR/USD

EUR/USD Daily Chart

Chart - Created Using FXCM Marketscope 2.0

  • EUR/USD appears to be finding near-term resistance around 1.1180 (23.6% expansion) to 1.1210 (61.8% retracement), but the failure to retain the bearish RSI momentum carried over from May could stoke a larger rebound over the near-term as Greece takes further steps to secure its third bailout program.
  • At the same time, the Euro-Zone’s 2Q Gross Domestic Product (GDP) report may heighten the appeal of the single currency as the growth rate is expected to increase an annualized 1.3% following the 1.0% expansion during the first three-months of 2015, but the long-term outlook for EUR/USD remains bearish amid the divergence in the policy outlook.
  • Nevertheless, DailyFX Speculative Sentiment Index (SSI) shows retail crowd remains net-short EUR/USD since March 9, with the ratio approaching extremes as it slips to -2.62 as 28% of traders are long.

USD/CAD

USD/CAD Daily Chart
  • USD/CAD may face range-bound prices in the days ahead as the Fibonacci overlap around 1.2930 (61.8% expansion) to 1.2950 (23.6% retracement) offers near-term support, but the recent decline in the RSI may highlight a larger pullback as it struggles to retain the upward trend from back in April.
  • Will keep a close eye on former resistance around 1.2790 (38.2% retracement) to 1.2800 (38.2% expansion) amid the risk for a larger pullback, but will look for a higher-low should a larger correction materialize as the long-term outlook for USD/CAD remains bullish.
  • Waiting for a break/close above 1.3210 (78.6% expansion) to favor a resumption of the upward trend.

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Read More:

Price & Time: USD/MXN - Still Up In The Air

EUR/USD Rally Buffed by Decline in European Equities - Why?

USDOLLAR(Ticker: USDollar):

Index

Last

High

Low

Daily Change (%)

Daily Range (% of ATR)

DJ-FXCM Dollar Index

11957.67

12060.08

11948.25

-0.60

205.26%

EUR/USD Breaks Out- Targets to Watch Ahead of Greek Vote, 2Q GDPUSDOLLAR Daily Chart

Chart - Created Using FXCM Marketscope 2.0

  • Dow Jones-FXCM U.S. Dollar faces a risk for a further decline as it threatens range support; close below he Fibonacci overlap around 11,951 (38.2% expansion) to 11,965 (23.6% retracement) may open up the door for a larger pullback especially as the RSI struggles to retain the bullish momentum from May.
  • With market participants anticipating a rebound in U.S. Retail Sales, a marked pickup in household consumption may fuel speculation for a Fed rate hike at the September 17 interest rate decision as it remains one of the leading drivers of growth and inflation.
  • Failure to retain the range may spur a run at former resistance around 11,898 (50% retracement) to 11,901 (78.6% expansion).

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EUR/USD Breaks Out- Targets to Watch Ahead of Greek Vote, 2Q GDP

--- Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

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