Weekly Outlook: 2014, June 01 - 08

NZD/USD forecast for the week of June 2, 2014, Technical Analysis

The NZD/USD pair went back and forth in a fairly wild week over the last 5 sessions, ultimately settling near the 0.85 handle. It appears that we are finding enough support in this general vicinity to keep the market somewhat afloat, but we recognize that the support goes all the way down to the 0.84 handle. Down there, things could get ugly, but at the end of the day we believe that the buyers will continue to step in and push the market higher. With that, we are bullish on a supportive candle.

GBP/USD forecast for the week of June 2, 2014, Technical Analysis

The GBP/USD pair went back and forth during the course of the week with a slightly negative tone to it. At the end of the day though, the market seems to have found a little bit of support at the 1.67 level, so we think that this market will continue to go higher, and ultimately test the 1.70 level yet again. That area getting broken to the upside would be very bullish, and as a result it would become a buy-and-hold market at that point in time. The “floor” in this market is down at the 1.65 level.

EUR/USD forecast for the week of June 2, 2014, Technical Analysis

The EUR/USD pair went back and forth during the course of the week, essentially settling nothing. We are finding the 1.36 level to be somewhat supportive though, and that is a positive sign. Ultimately though it appears that the real support probably closer to the 1.35 handle, therefore it is not possible by with any type of real confidence at this moment in time. However, if we broke above the 1.37 handle, at that point in time we feel that this market and its tone would be changing.

Forex - Weekly outlook: June 2 - 6

The dollar moved lower against the euro on Friday but still notched up weekly gains against the single currency amid widespread expectations for monetary easing by the European Central Bank at its upcoming policy meeting.

EUR/USD rose to 1.3633 late Friday from a three month trough of 1.3585 on Thursday, trimming the week’s losses to 0.13%. For the month, the euro dropped 1.69% against the dollar.

Data on Friday showing that the annual rate of inflation in Italy and Spain slowed in May underlined expectations that the ECB will take steps to tackle low consumer price growth, which its threatening the fragile recovery in the euro zone.

The dollar eased on Friday after data showed that U.S. consumer spending fell 0.1% in April from a month earlier, missing forecasts for a 0.2% increase. Personal income rose 0.3%, in line with forecasts.

Separately, the final reading of the University of Michigan's consumer-sentiment index for May came in at 81.9, up slightly from a preliminary reading of 81.8, but falling short of forecasts for 82.5.

The dollar was almost unchanged against the yen late Friday, with USD/JPY settling at 101.76, down 0.14% for the week.

The euro pushed higher against the yen on Friday, with EUR/JPY rising 0.22% to 138.76, up from Thursday’s four month lows of 137.95, but lost 0.27% for the week.

Elsewhere, the dollar was lower against the pound, with GBP/USD up 0.22% to 1.6722 late Friday, but the pair still ended the week 0.54% lower. Sterling’s losses were held in check by the view that the deepening economic recovery in the U.K. will prompt the Bank of England to raise interest rates ahead of other central banks.

The Canadian dollar slid against the U.S. dollar on Friday after official data showed that the rate of economic growth in Canada slowed sharply in the first three months of the year.

Statistics Canada reported that gross domestic product expanded 0.3% in the first quarter, slowing from growth of 0.7% in the preceding three months. The Canadian economy grew at an annualized rate of 1.2%, well below forecasts of 1.8%.

USD/CAD touched session highs of 1.0868 before pulling back to 1.0844 at the close.

In the week ahead, investors will be looking to Friday’s U.S. nonfarm payrolls report for May for further indications on the strength of the labor market, while Tuesday’s euro zone inflation report will also be in focus, ahead of the ECB policy meeting and press conference on Thursday.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, June 2

• Markets in China are to remain closed for a national holiday.
• Japan is to publish data on capital spending.
• Australia is to release data on building approvals and company operating profits.
• In the euro zone, Germany is to release preliminary data on consumer price inflation, while Spain and Italy are to produce data on manufacturing activity.
• Elsewhere in Europe, Switzerland is to publish its SVME index while the U.K. is to release what will be a closely watched manufacturing report. The U.K. is also to release data on net lending and mortgage approvals.
• Later Monday, the Institute of Supply Management is to publish a report on U.S. manufacturing activity.

Tuesday, June 3

• China is to publish data on service sector activity, as well as the final reading of the HSBC manufacturing index.
• Japan is to publish a report on average cash earnings.
• Australia is to release data on the current account and retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.
• The Reserve Bank of Australia is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
• The U.K. is to publish data on construction sector activity, as well as private sector data on house price inflation.
• The euro zone is to release preliminary data on consumer inflation as well as a report on the unemployment rate. Spain is also to publish data on the change in the number of people employed.
• The U.S. is to produce data on factory orders.

Wednesday, June 4

• Australia is to publish the monthly report on gross domestic product, the broadest indicator of economic activity and the leading indicator of economic growth.
• The U.K. is to produce data on service sector activity.
• In the euro zone, Spain and Italy are to release data on service sector activity.
• The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. Also Wednesday, both the U.S. and Canada are to publish data on the trade balance.
• Later in the day, the Bank of Canada is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
• The ISM is to publish a report on U.S. service sector activity.

Thursday, June 5

• Australia is to publish data on the trade balance, the difference in value between imports and exports.
• China is to release its HSBC services index.
• The euro zone is to release data on retail sales, while Germany is to produce data on factory orders.
• The BoE is to announce its benchmark interest rate.
• Later in the day, the ECB is to announce its benchmark interest rate. The announcement is to be followed by a press conference with President Mario Draghi.
• Meanwhile, Canada is to release data on building permits and the Ivey PMI and the U.S. is to publish the weekly report on initial jobless claims.

Friday, June 6

• In the euro zone, Germany is to release data on the trade balance.
• The Swiss National Bank is to publish data on its foreign currency reserves. This data is closely scrutinized for indications of the size of the bank’s operations in currency markets. Switzerland is also to release data on consumer price inflation.
• The U.K. is to produce data on the trade balance and a report on consumer inflation expectations.
• Canada is to publish data on the change in the number of people employed and the unemployment rate.
• The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

USD/JPY weekly outlook: June 2 - 6

The dollar ended Friday’s session almost unchanged against the yen, after slipping lower earlier in the day following the release of some soft U.S. data on personal spending and consumer confidence.

USD/JPY touched session lows of 101.51 before pulling back to 101.76 late Friday. For the week, the pair slid 0.14%.

The pair is likely to find support at 101.25 and resistance at 102.13.

The dollar eased after data showed that U.S. consumer spending fell 0.1% in April from a month earlier, missing forecasts for a 0.2% increase. Personal income rose 0.3%, in line with forecasts.

Separately, the final reading of the University of Michigan's consumer-sentiment index for May came in at 81.9, up slightly from a preliminary reading of 81.8, but falling short of forecasts for 82.5.

The yen was also boosted by falls in U.S. 10-year Treasury yields. U.S. bonds have rallied in recent sessions as buying in 10-year Treasury notes pushed yields to the lowest levels since January. Profit taking by investors on Friday pulled the yield on 10-year notes back up to 2.48% late Friday.

Elsewhere, the euro pushed higher against the yen on Friday, with EUR/JPY rising 0.22% to 138.76, up from Thursday’s four month lows of 137.95.

The shared currency remained under pressure amid mounting expectations for monetary easing by the European Central Bank at its upcoming policy meeting this week.

Data on Friday showing that the annual rate of inflation in Italy and Spain slowed in May underlined expectations that the ECB will take steps to tackle low consumer price growth, which its threatening the fragile recovery in the euro zone.

Demand for the yen continued to be underpinned by diminished expectations for more stimulus by the Bank of Japan, after the bank said earlier this month that its stimulus program has been working as intended.

In the week ahead, investors will be looking to Friday’s U.S. nonfarm payrolls report for May for further indications on the strength of the labor market, while Tuesday’s euro zone inflation report will also be in focus, ahead of the ECB policy meeting and press conference on Thursday.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, June 2

• Japan is to publish data on capital spending.
• Later Monday, the Institute of Supply Management is to publish a report on U.S. manufacturing activity.

Tuesday, June 3

• Japan is to publish a report on average cash earnings.
• The U.S. is to produce data on factory orders.

Wednesday, June 4

• The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. The U.S. is also to publish data on the trade balance.
• The ISM is to publish a report on U.S. service sector activity.

Thursday, June 5

• The ECB is to announce its benchmark interest rate. The announcement is to be followed by a press conference with President Mario Draghi.
• The U.S. is to publish the weekly report on initial jobless claims.

Friday, June 6

• The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

USD/CHF weekly outlook: June 2 - 6

The dollar slid lower against the Swiss franc on Friday as disappointing U.S. economic reports on personal spending and consumer sentiment weighed.

USD/CHF touched lows of 0.8934, before easing back to 0.8952 at the close of trade, down 0.30%.

The pair was likely to find support at 0.8800 and resistance at 0.8989, last Wednesday’s high and a more than three-month high.

The dollar eased after data showed that U.S. consumer spending fell 0.1% in April from a month earlier, missing forecasts for a 0.2% increase. Personal income rose 0.3%, in line with forecasts.

Separately, the final reading of the University of Michigan's consumer-sentiment index for May came in at 81.9, up slightly from a preliminary reading of 81.8, but falling short of forecasts for 82.5.

The dollar had strengthened broadly against the other major currencies earlier in the week as the euro tumbled to more than three-month lows amid mounting expectations for monetary easing by the European Central Bank.

Data on Friday showing that the annual rate of inflation in Italy and Spain slowed in May underlined expectations that the ECB will take steps to tackle low consumer price growth, which its threatening the fragile recovery in the euro zone.

The US Dollar Index, which tracks the dollar against six other major currencies, traded softer on Friday and was last down 0.11% at 80.44. Earlier in the week, the index rose to highs of 80.63, the most since early April.

In the week ahead, investors will be looking to Friday’s U.S. nonfarm payrolls report for May for further indications on the strength of the labor market, while Tuesday’s euro zone inflation report will also be in focus, ahead of the ECB policy meeting and press conference on Thursday.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, June 2

• Switzerland is to publish its SVME index.
• Later Monday, the Institute of Supply Management is to publish a report on U.S. manufacturing activity.

Tuesday, June 3

• The U.S. is to produce data on factory orders.

Wednesday, June 4

• The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. The U.S. is also to publish data on the trade balance.
• The ISM is to publish a report on U.S. service sector activity.

Thursday, June 5

• The ECB is to announce its benchmark interest rate. The announcement is to be followed by a press conference with President Mario Draghi.
• The U.S. is to publish the weekly report on initial jobless claims.

Friday, June 6

• The Swiss National Bank is to publish data on its foreign currency reserves. This data is closely scrutinized for indications of the size of the bank’s operations in currency markets.Switzerland is also to release data on consumer price inflation.
• The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

USD/CAD weekly outlook: June 2 - 6

The Canadian dollar slid to session lows against the U.S. dollar on Friday after official data showed that the rate of economic growth in Canada slowed sharply in the first three months of the year.

USD/CAD touched session highs of 1.0868 before pulling back to 1.0844 at the close.

Statistics Canada reported that gross domestic product expanded 0.3% in the first quarter, slowing from growth of 0.7% in the preceding three months.

On a year-over-year basis, the Canadian economy grew 1.2%, well below forecasts of 1.8% after growing at an annual rate of 2.7% in the previous quarter.

The data dampened expectations that the Bank of Canada could adopt a slightly less dovish tone at its upcoming rate review on Wednesday. Expectations had been boosted after data earlier this month showed that the annual rate of inflation in Canada rose to the central bank’s target of 2% for the first time in in two years in April.

In the U.S., data on Friday showed that consumer spending fell 0.1% in April from a month earlier, missing forecasts for a 0.2% increase. Personal income rose 0.3%, in line with forecasts.

Separately, the final reading of the University of Michigan's consumer-sentiment index for May came in at 81.9, up slightly from a preliminary reading of 81.8, but falling short of forecasts for 82.5.

The dollar index, which tracks the dollar against six other major currencies, traded softer on Friday and was last down 0.11% at 80.44. Earlier in the week, the index rose to highs of 80.63, the most since early April.

In the week ahead, investors will be looking to Friday’s U.S. nonfarm payrolls report for May for further indications on the strength of the labor market, while Wednesday’s rate statement by the BoC will also be in focus.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, June 2

• The Institute of Supply Management is to publish a report on U.S. manufacturing activity.

Tuesday, June 3

• The U.S. is to produce data on factory orders.

Wednesday, June 4

• The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. Also Wednesday, both the U.S. and Canada are to publish data on the trade balance.
• Later in the day, the Bank of Canada is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
• The ISM is to publish a report on U.S. service sector activity.

Thursday, June 5

• Canada is to release data on building permits and the Ivey PMI.
• The U.S. is to publish the weekly report on initial jobless claims.

Friday, June 6

• Canada is to publish data on the change in the number of people employed and the unemployment rate.
• The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

AUD/USD weekly outlook: June 2 - 6

The Australian dollar ended Friday’s session near a two-week high against its U.S. counterpart, following the release of disappointing U.S. data on personal spending and consumer confidence.

AUD/USD hit 0.9328 on Friday, the pair’s highest since May 20, before subsequently consolidating at 0.9310 by close of trade on Friday, 0.02% higher for the day and up 0.84% for the week.

The pair is likely to find support at 0.9209, the low from May 29 and resistance at 0.9334, the high from May 20.

The greenback slumped after data showed that U.S. consumer spending fell 0.1% in April from a month earlier, missing forecasts for a 0.2% increase. Personal income rose 0.3%, in line with forecasts.

Separately, the final reading of the University of Michigan's consumer-sentiment index for May came in at 81.9, up slightly from a preliminary reading of 81.8, but falling short of forecasts for 82.5.

Meanwhile, in Australia, data released earlier in the week showed that private capital expenditure fell 4.2% in the first quarter, compared to expectations for a 1.4% decline.

Data from the Commodities Futures Trading Commission released Friday showed that speculators decreased their bullish bets on the Australian dollar in the week ending May 27.

Net longs totaled 15,848 contracts, compared to net longs of 19,462 in the preceding week.

In the week ahead, investors will be looking to Friday’s U.S. nonfarm payrolls report for May for further indications on the strength of the labor market.

Tuesday’s rate decision by the Reserve Bank of Australia will also be in focus, as well as highly-anticipated Australian first quarter growth data due Wednesday.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, June 2

• Australia is to release data on building approvals and company operating profits.
• Later Monday, the Institute of Supply Management is to publish a report on U.S. manufacturing activity.

Tuesday, June 3

• Australia is to release data on the current account and retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.
• The Reserve Bank of Australia is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
• Meanwhile, the U.S. is to produce data on factory orders.

Wednesday, June 4

• Australia is to publish the monthly report on gross domestic product, the broadest indicator of economic activity and the leading indicator of economic growth.
• The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. Also Wednesday, the U.S. is to publish data on the trade balance.

Thursday, June 5

• Australia is to publish data on the trade balance, the difference in value between imports and exports.
• Meanwhile, the U.S. is to publish the weekly report on initial jobless claims.

Friday, June 6

• The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

NZD/USD weekly outlook: June 2 - 6

The New Zealand dollar ended Friday’s session close to an 11-week low against its U.S. counterpart, as investors bet on strong growth in the U.S. during the second quarter, despite the release of disappointing data on personal spending and consumer sentiment.

NZD/USD hit 0.8450 on Thursday, the pair’s lowest since March 12, before subsequently consolidating at 0.8500 by close of trade on Friday, up 0.17% for the day but still 0.61% lower for the week.

The pair is likely to find support at 0.8450, the low from May 29 and resistance at 0.8566, the high from May 28.

The greenback slumped after data showed that U.S. consumer spending fell 0.1% in April from a month earlier, missing forecasts for a 0.2% increase. Personal income rose 0.3%, in line with forecasts.

Separately, the final reading of the University of Michigan's consumer-sentiment index for May came in at 81.9, up slightly from a preliminary reading of 81.8, but falling short of forecasts for 82.5.

Meanwhile, traders shrugged off data that showed the U.S. economy contracted in the first quarter and bet on improvement in the second quarter.

Market analysts expects second quarter growth to snap back with a 3.8% gain, after data on Thursday showed that the economy shrank at a seasonally adjusted annual rate of 1% in the first quarter.

Elsewhere, in New Zealand, data released earlier in the week showed that the ANZ business confidence index fell to 53.5 this month, from a reading of 64.8 in April.

Data from the Commodities Futures Trading Commission released Friday showed that speculators modestly increased their bullish bets on the New Zealand dollar in the week ending May 27.

Net longs totaled 17,994 contracts as of last week, compared to net longs of 17,594 contracts in the previous week.

In the week ahead, investors will be looking to Friday’s U.S. nonfarm payrolls report for May for further indications on the strength of the labor market.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, June 2

• The Institute of Supply Management is to publish a report on U.S. manufacturing activity.

Tuesday, June 3

• The U.S. is to produce data on factory orders.

Wednesday, June 4

• The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. The U.S. is also to publish data on the trade balance.
• The ISM is to publish a report on U.S. service sector activity.

Thursday, June 5

• The U.S. is to publish the weekly report on initial jobless claims.

Friday, June 6

• The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

GBP/USD weekly outlook: June 2 – 6

The dollar was lower against the pound on Friday, following the release of some disappointing U.S. economic data, but still notched up a weekly gain against sterling.

GBP/USD rose 0.22% to 1.6752 late Friday from lows of 1.6691 in the previous session, but still lost 0.72% for the week.

Cable was likely to find support at 1.6691, Thursday’s low and a six-week low and resistance at 1.6815.

The dollar eased on Friday after data showed that U.S. consumer spending fell 0.1% in April from a month earlier, missing forecasts for a 0.2% increase. Personal income rose 0.3%, in line with forecasts.

Separately, the final reading of the University of Michigan's consumer-sentiment index for May came in at 81.9, up slightly from a preliminary reading of 81.8, but falling short of forecasts for 82.5.

The U.S. dollar index, which tracks the dollar against six other major currencies, traded softer on Friday and was last down 0.11% at 80.44. Earlier in the week, the index rose to highs of 80.63, the most since early April.

The pound came under pressure earlier in the week after reports indicated that the U.K. U.K. housing market is starting to slow, prompting investors to trim back expectations for a rate hike by the Bank of England later this year.

Sterling remained weaker even after BoE monetary policy committee member Martin Weale said Wednesday that a rise in the cost of borrowing should happen "sooner rather than later".

He said the bank should not wait too long to start raising interest rates as a delay would eventually mean sharper and more painful tightening of policy.

In the week ahead, investors will be looking to Friday’s U.S. nonfarm payrolls report for May for further indications on the strength of the labor market, while U.K. data on manufacturing, services and construction sector growth will also be in focus.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, June 2

• The U.K. is to release what will be a closely watched manufacturing report, as well as data on net lending and mortgage approvals.
• Later Monday, the Institute of Supply Management is to publish a report on U.S. manufacturing activity.

Tuesday, June 3

• The U.K. is to publish data on construction sector activity, as well as private sector data on house price inflation.
• The U.S. is to produce data on factory orders.

Wednesday, June 4

• The U.K. is to produce data on service sector activity.
• The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. The U.S. is also to publish data on the trade balance.
• Later Wednesday, the ISM is to publish a report on U.S. service sector activity.

Thursday, June 5

• The BoE is to announce its benchmark interest rate.
• The U.S. is to publish the weekly report on initial jobless claims.

Friday, June 6

• The U.K. is to produce data on the trade balance and a report on consumer inflation expectations.
• The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.