Two trades to watch: EUR/USD, S&P500

EUR/USD trades around 1.22, GFK consumer confidence misses. S&P500 looks ahead to US GDP Q1 revision, initial jobless claims & durable goods orders.

Germany

EUR/USD trades around 1.22, German GFK consumer confidence misses

German GFK consumer confidence improved by less than expected for June. The consumer sentiment indicator ticked up to -7 from a downwardly revised -8.6 in May. Expectations had been for -5.5. 

US Dollar Index holds the majority of gains from the previous session as investors brace themselves for tomorrow’s inflation print. 

Today, US durable goods orders, initial jobless claims and Q1 GDP (2nd reading) are awaited. GDP expected to confirm 4.1% QoQ whilst jobless claims are expected to fall to a new pandemic low of 425k. 

Where next for EUR/USD? 

EUR/USD has been trending higher since early April, trading above its steep 2 month ascending trendline.  At the same time a descending trendline dating back to the start of the year aided in the formation of a symmetrical triangle. The price broke out of this triangle to the upside earlier this month, which could put 1.2280 the January 8 high as the next target ahead of 1.2350. 

However, there is signs of negative RSI divergence a sign that momentum is slowing and could precede a move lower. It would take a move below support at 1.2150 last week’s low and the ascending trendline support to negate the near term uptrend.  

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S&P 500 looks ahead to US GDP revision, durable goods & jobless claims

US stocks rebounded on Wednesday as investors continued to battle reopening optimism against concerns over rising prices. 

Fed speakers re-iterated that inflation was likely transitory, reining expectations of the Fed tapering support earlier, lifting stocks 

The lion’s share of data will be from the US with US durable goods, initial jobless claims & GDP data all due. 

Where next for the S&P 500? 

The S&P 500  has traded within an ascending channel since early November. It trades above its 50 and 100 ascending trend line indicating an established bullish trend. 

The price also pushed back over the descending trendline dating back to the start of this month. 

The MACD appears to be forming a bullish crossover which could suggest that there is more upside to come. 

Any move higher would need to over come resistance at 4215, the weekly high in order to move on towards 4245 the all time high. 

On the flip side strong support can be seen around 4100, the 50 sma, the descending trendline support and the late April low. A move below here could negate the near term uptrend.  

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