EUR/usd
The US stock market managed to hit a fresh global high, but the trading range was rather narrow, which spoke about moderate trading volumes. At the time when the market reaches new round levels it gets flooded by retail investors, while corporate investors start lock in their profits. We tend to think that the latter are much stronger, so at the end of the month and before the beginning of the new financial year we expect portfolio rebalancing of various funds and financial companies. And it means that the trends which formerly dominated the markets will be corrected. eurusd may gain momentum on this, returning to 1.33 or even to 1.34. The stock exchanges also probably faced selling close to 2000 in S&P 500. However, such reaction of the market needs a reason. The latter can be seen in the poor employment or generally economic statistics. This day, by the way, suits for reaction in both directions. Before the beginning of the US session there will be a release of the revised data on the US GDP in the second quarter. The initial rate may be significantly revised. Thus, for example, in the first quarter the initial annualized growth made 0.1%, but after revision the GDP proved to decline to 1.0% and the final estimate reported decline of 2.9%. Anyway, investors seem to be more optimistic about the second quarter. The initial rate of 4.0% is expected to be revised down to 3.9%. If the second estimate differs much (by 0.5%) from the expectations, it may stir reaction in the market. Besides, there will also be publication of weekly unemployment claims. A week before this indicator fell below 300K and the number of continuing claims reached 2.5bln. These data also can affect the course of trading, so we should keep a careful eye on the coming statistics at 12:30 GMT.
GBP/USD
The cable continued to recover yesterday, as we had expected. The pair reached 1.66, then slightly pulled back and is now again trading at that level. It is quite likely that already today the pair will manage to reach 1.6730, but Britain will release little domestic statistics these days, so the pair's behaviour will generally depend on the US and EU statistics. Despite the expectations of correction in the coming days or even weeks, we still believe that the downtrend will retain the potential to decline to 1.50.
USD/JPY
The correction is going on. The pair has completely lost the gains of the beginning of the week and has returned to the levels of consolidation at the end of the previous week. The failures of the upward rally let bears put pressure on the pair, bringing trading back into the channel, dominating since the beginning of the year. The levels of 103.50 and then of 103.00 can become important supports of usdjpy. Bears will hardly have enough strength to go much lower.
AUD/USD
The aussie has shot up today on the release of investment statistics for the private sector. In the second quarter spending grew by 1.1% against the expected decline by 0.6%, the previous rates were revised up, so the annual growth now makes 4.0%. The Aussie is trading close to 0.9360, which is the highest level of the month. There are growing expectations that the RBA will take a softer stance regarding the unreasonably high rate of the Australian currency.
