Despite mixed European data, the EUR/USD pair managed to advance up to 1.1221 last Friday

EUR/USD

Despite mixed European data, the EUR/USD pair managed to advance up to 1.1221 last Friday, helped by quite disappointing US data.  Still, the pair was unable to hold to its gains beyond the 1.1200 figure, ending the week at 1.1161, and still looking weak in the long term. German preliminary Q2 GDP came in at 0.4%, up by 3.1% compared to a year before, but for the EU as a whole,  Q2 GDP printed 0.3%, matching expectations and the previous quarter reading, revised down to 0.3% from 0.5%. Industrial production in the EU grew by 0.6% in June, beating previous -1.2%, but down year-on-year to 0.4%. US data missed big, as July  retail sales came in flat on the month versus expectations of a 0.4% gain, while the Producer Price Index for final demand decreased 0.4% in the same month. On an unadjusted basis, the final demand index moved down 0.2% for the 12 months ended in July. Disappointing retail sales and low PPI suggest the FED will be in no rush to raise rates.  Adding to the dollar's bearish case was the Michigan University index of consumer sentiment, at 90.4 for August against expectations of 91.5.

Technically, the daily chart shows that  the price retreated sharply once again from its 100 DMA, while  the Momentum indicator has turned lower within positive territory, whilst the RSI indicator continues lacking clear directional strength around neutral territory. The 20 DMA heads higher around 1.1090, converging with the 50% retracement of the latest bullish run and being the level to break to confirm additional slides. In the 4 hours chart, a bullish 20 SMA contained the downside during the past sessions, but is now a handful of pips below the current level, while the technical indicators head modestly lower around their mid-lines, increasing the risk of a downward extension for this Monday.

Support levels: 1.1125 1.1090 1.1045

Resistance levels: 1.1200 1.1235 1.1280

USD/JPY

The Japanese yen closed higher against the greenback for a third consecutive week, with the pair ending the week at 101.23, shedding roughly 100 pips daily basis on the back of disappointing US data. The USD/JPY pair plummeted to 100.82 on US Retail Sales´ miss, with the dollar sharply lower against all of its major rivals. The FED will release the Minutes of its latest meeting this week that will may define whether the pair can finally break below the 100 level, if the US Central Bank maintains the uncertainty surrounding an upcoming rate hike. Technically, the daily chart shows that the pair continues pressuring a major long term support around 100.65, the 50% retracement of its "Abenomics" rally between 2011 and 2015, while developing far below its moving averages, and with the technical indicators resuming their declines well below their mid-lines, all of which support some further slides. In the 4 hours chart, the technical indicators have recovered some ground within negative territory, but turned flat around their mid-lines, showing no actual upward strength, whilst the 100 SMA has broken below the 200 SMA well above the current level. 

Support levels: 101.00 100.65 100.20

Resistance levels: 101.40 101.95 102.35 

GBP/USD

The GBP/USD pair plummeted to a fresh 4-week low of 1.2908 last Friday, closing the day nearby and retaining its underlying bearish trend,  undermined by another negative macroeconomic release suggesting the UK has fallen into recession. According to the National Statistics, construction output dipped 0.7% in the second quarter of 2016, after a drop of 0.3% in the previous three months,  the first time there have been two consecutive quarters of falling since 2012. Also, the Conference Board Leading Economic Index declined 0.3% after a 0.1% increase in June. The Pound benefited temporarily from poor US data, rising up to a daily high of 1.3034 against the greenback, but strong selling interest contained the pair around the critical figure. From a technical point of view, the pair is not only poised to retest the record low of 1.2793 posted last July 6th, but to extend its decline forward,  as in the daily chart, technical indicators have accelerated their declines within negative territory, with the RSI indicator nearing oversold readings, but still with room for further slides, whilst the 20 SMA regained its bearish slope above the current level. In the shorter term, the 4 hours chart shows that technical indicators also stand in bearish territory, barely bouncing from oversold readings, while the 20 SMA maintains its bearish slope around 1.2985, reinforcing the resistance area. 

Support levels: 1.2900 1.2870 1.2830

Resistance levels: 1.2940 1.2985 1.3020 

AUD/USD

The AUD/USD pair closed the week with a soft tone at 0.7651, having trimmed most of its early gains and down from a 4-month high of 0.7755, undermined by poor Chinese data, and comments from RBA’s outgoing Governor Stevens, who expressed that further central bank easing won't be able to benefit the economy at this point, in his last speech. In China, July retail sales, industrial production, and urban investment, came in below expected and previous month's  readings, reviving concerns over an economic slowdown in the country that could quickly spread in the region and further. The daily chart, however, shows that this latest decline could be well understands as corrective, as the price remains above a still bullish 20 SMA, whilst the technical indicators have retreated from near oversold conditions and head lower, but well above their mid-lines. In the 4 hours chart, the price plummeted after failing to overcome its 20 SMA, around 0.7700, whilst the technical indicators fell well below their mid-lines, holding near oversold territory. At this point, however, the pair needs to break below the 0.7600 figure to be able to extend its decline further during the upcoming sessions. 

Support levels: 0.7635 07600 0.7570

Resistance levels: 0.7700 0.7740 0.7790

Dow Jones

Wall Street closed the week mixed, with the Dow Jones Industrial Average and the S&P retreating from record highs, but the Nasdaq Composite advancing 4 points to close at 5,232.90. The DJIA fell by 0.20% or 27 points, closing at 18,576.47, weighed by soft Retail Sales and PPI figures. The Dow Jones ended the week 0.2% higher, with Exxon Mobil up 1.3% and Chevron closing 0.75% higher, limiting the negative impact of mining and chemical companies the worse-performing sectors. The DJIA daily chart shows that the index keeps consolidating near historical highs, with the benchmark holding above a horizontal 20 DMA, and indicators lacking clear directional strength, but holding within positive territory. In the shorter term, the 4 hours chart presents a modestly bullish tone, with the index above a slightly bullish 20 SMA, and the technical indicators bouncing from their mid-lines. Still, the benchmark needs to extend beyond 18,640, the intraday high posted last Thursday, to gain some upward momentum and avoid a deeper retracement during the upcoming days. 

Support levels: 18,532 18,483 18,466

Resistance levels: 18,590 18,640 18,695 

FTSE 100

The Footsie consolidated its latest gains on Friday, ending the day pretty much flat at 6,916.02, up by 1 point. Despite the mining sector edged sharply lower, retail shares maintained the benchmark afloat, with EasyJet leading the advance, up by 3.97%, followed by Marks & Spencer that added 3.81%. A raft of disappointing Chinese data, however, sent commodity-related shares sharply lower, with Antofagasta shedding 3.38%, Rio Tinto closing down 3.21% and Anglo American losing 3.16%. The index extended intraday up to 6,933, its highest since June 2015, but ended up with a doji daily basis. In the same chart, however, a positive tone prevails, with the benchmark holding well above bullish moving averages, and technical indicators heading higher within positive territory. The RSI indicator stands in overbought territory, with no signs of changing bias. In the 4 hours chart, the Momentum indicator continues hovering right above its 100 level, the  RSI indicator consolidates around 72, whilst the benchmark is also above its moving averages, all of which supports further gains for the upcoming days, particularly if the Pound extends its decline. 

Support levels: 6,882 6,831 6,782 

Resistance levels: 6,933 6,962 7,000

DAX

European stocks edged lower on Friday, with the German DAX shedding 29 points or 0.27% to end at 10,713.43, although the bullish tone of the benchmark was hardly affected by this modest decline. After a choppy session, equities fell on the back of weaker-than-expected US data, but strong German GDP readings for the second quarter outpaced concerns over the economic future of the US. Deutsche Lufthansa led winners, adding 1.75%, while Volkswagen was the worst performer, down by 1.57%. Holding around the daily close ahead of a new weekly opening, the index's bullish potential eased partially, as the RSI indicator is retreating within oversold territory, while the Momentum indicator also turned slightly lower well above their mid-lines. Nevertheless and given that the index remains well above its moving averages, it seems that it could correct lower, rather than suggesting it has reached a top. In the 4 hours chart, the benchmark is above a sharply bullish 20 SMA, the Momentum indicator is retreating within positive territory, while the RSI is aiming modestly higher around 71, maintaining the dominant bullish trend firm in place.  

Support levels: 10,672 10,610 10,557 

Resistance levels: 10,744 10,815 10,860

Nikkei

Asian shares surged last Friday, tracking Wall Street's previous rally to record highs, with the Nikkei 225 closing the day at 16,919.92, up by 186 points or 1.10%. A weaker Japanese yen also helped the benchmark that closed at its highest in two months, with export-oriented equities leading the advance,  with Toshiba adding 3.79% after announcing that it swung to a ¥79.8 billion net-profit for the April-June period. DeNa Corp, a mobile and e-commerce portal was the daily winner up by 10.34%. The Nikkei, however, gave back all of its daily gains in after-hours trading, as US indexes retreated from record highs on dismal US data. Technically, the daily chart shows that the upside is still favored, as the index holds above its 20 and 100 DMAs, while having posted a higher high. In the mentioned time frame technical indicators have lost their bullish strength, but remain within positive territory. Shorter term, the 4 hours chart shows that the index is also above a modestly bullish 20 SMA, while the technical indicators stand path within neutral territory, giving no clues on what's next. 

Support levels: 16,782 16,727 16,665

Resistance levels: 16,832 16,890 16,955

Gold

Spot gold plummeted during the last trading hours of the week, trimming all of its early gains and closing with a doji at $1,334.85, despite poor US data. The commodity initially surged to $1,356.39 following lackluster US Retail Sales figures, but reversed all of its gains. There was no clear catalyst behind the late decline, although it could be attributed to profit taking ahead of the weekend, due the persistent uncertainty surrounding the economic future of all major economies. Despite gold has lost its upward steam during in the past month, the long term bullish potential remains intact, with the commodity now in a consolidative phase, firm above 1,3000.00. Daily basis, the price is still holding above 1,333.50, the 23.6% retracement of its latest weekly advance and he immediate support, and hovering around a horizontal 20 SMA, whilst the technical indicators have turned south and are currently crossing their mid-lines towards the downside.  In the 4 hours chart, the technical indicators are now within negative territory, whilst the price is below all of its moving averages, all of which supports some further slides for the upcoming sessions. 

Support levels: 1,333.50 1,320.251,310.80

Resistance levels: 1.342.50 1,352.60 1,367.20 

WTI Crude Oil

Crude oil prices surged on Friday, in spite of negative macroeconomic data, with WTI futures reaching $44.75 a barrel, its highest in three weeks, and closing the day a few cents below the level. The black gold surged on hopes that the OPEC will take some action to stabilize the market, following comments from Saudi Energy Minister Khalid al-Falih, on Thursday. In the US, the number of drilling rigs surged for a seventh consecutive week, according to the Baker Hughes report, showing that drillers added 15 oil rigs in the week to Aug. 12 bringing the total rig count up to 396. US oil turned bullish, according to the daily chart, and seems poised to extend its gains during the upcoming sessions, as the price has accelerated well above a now flat 20 DMA, whilst the technical indicators head strongly higher within positive territory. In the 4 hours chart, the 20 SMA has crossed above the 100 SMA, with the price far above them and having also overcome the 200 SMA, whilst the technical indicators have lost upward strength within overbought territory, but are far from suggesting a downward extension. The 61.8% retracement of the latest weekly slump stands at 43.85, and as long as above it, the risk is towards the upside. 

Support levels: 44.40 43.85 43.05 

Resistance levels: 45.00 45.60 46.20