The U.S. dollar rose up against major currencies in the basket on Wednesday after Fed chair, Powell Jerome expressed the positive strong growth economy in the United State, the recent monetary policy is suitable with the recent economy and international trade policy may build the uncertainty which now U.S. economy is growing well. Powell’s opinion mostly positive for the growth economy in The united States as well as he may confirm to hike the interest rate 2 more times in 2018.
In my view, after major currencies fell hardly, they may take a breath. I still suggest the lowest support line for EUR/USD at 1.1500 points and the lowest support line for GBP/USD at 1.3000. However, investor may focus on the U.S. economic data in July because it is the beginning of trade war with China. The good expectation may support greenback to hold steady before index releases. I think the reaction on the market can be strong after Philadelphia manufacturing index releases: if it is as good as the forecast or higher, the U.S. dollar may rise. But if the index is lower than the forecast 21.5 and less than June 19.9, investor may sell dollar and New York stock market might also fall lower.
The investment sentiment was better after Powell’s announcements and major Asian stock markets including Thailand gained on Wednesday.
Bitcoin price rose above 7,300 dollars on Wednesday. Bitcoin had built the reversal pattern “Head and Shoulders” since 10th June 2018 and it broke the neck line strongly on Tuesday. According to the pattern, Bitcoin price may rise to 7,600 dollar and then I suggest seeing how strong of this bullish trend. If the bullish trend is still strong, BTC may rise to 7,800 dollar and break this resistance. But if bullish trend will be weaker, it may edge lower to 7,000 dollar again.
Economic indices in focus:
• Australia: Employment change (Jun) at 08.30 a.m.
• UK: Retail sales and Core Retail sales (Jun) at 15.30
• USA: Philadelphia Fed manufacturing index (Jul) at 19.30.00 p.m.
By Niramon Nitnitiphruet
Financial analyst, Olymp Trade.