The focal point this week was on the employment outlook in several parts of the world. In Australia, the Bureau of Statistics reported employers hired 15,900 more people in June, compared a 5,100 decline in May. The Jobless Rate ticked higher from 5.9 percent to 6 percent.
Meanwhile, Canada saw a dimmer jobs outlook as Statistics Canada reported a surprise 9,400 decline in Employment Change. Analysts were expecting another month of increased hiring (median forecast 20,700). The Unemployment Rate also ticked higher in June to 7.1 percent.
In other news, Canada’s Building Permits got a surprise surge in May, attributed to shopping malls and multi-dwellings in Vancouver and Toronto. Permits surged 13.8 percent, the strongest seen since late-2013. The June Housing Starts came in slightly better than expected, while Ivey PMI sank further below 50 to 46.9, the worst reading since December.
Gold bulls were able to maintain control of price this week, etching the sixth straight weekly bullish close well above the $1,300 level. We could be seeing a hardened support just above $1,300 for a potential move back toward $1,400. This is important in order to prevent another breakdown toward $1,250.
Meanwhile, Oil has made big moves in the past few weeks, sliding about $7 in three successive bearish weeks. Bulls will now have to contend with further selling pressure as price breaks apart the $100 barrier. Since the move toward $100 has come much earlier than expected, we can now expect the risk of a move back down to the $90-$95 area.
EURUSD trading activity has eased this week despite the marginal bullish weekly close above 1.3600. This move is more favorable to bears than bulls, hence bulls should keep pushing price up. A break of 1.3700 is important to reduce the bearish tone. The more price stays unchanged, the higher the risk of this pair visiting 1.3500.
GBPUSD traded in the upper part of the prior week’s 170-pip range, giving back some gains after comfortable five-week winning streak. Although the retreat was minimal, bears could still unleash a barrage of selling pressure in the coming weeks, so buyers must prepared to defend the 1.7100 level.
The significant gathering of USDJPY sellers this week enabled this pair to fulfill another bearish week – this time price closed at its lowest since mid-November of 2013. Could this be the beginning of the end? Last possible bulwark could sit around the 100-101 area. Beyond that, we could see a quick trip toward 95-98. All this selling pressure won’t dissipate unless bulls take out the 103 level.
The Week Ahead
Monday is mostly quiet except for the release of Japan’s Revised Industrial Production; China’s New Loans; and Eurozone’s Industrial Production and ECB Draghi’s speech.
Activity will pick up significantly on Tuesday with UK BRC Retail Sales Monitor; Australia’s New Motor Vehicle Sales and RBA’s Monetary Policy Meeting Minutes; BOJ’s Monetary Policy Statement and presscon; Switzerland’s CPI; UK PPI Input, PPI and RPI; Germany and Eurozone ZEW Economic Sentiment; US Retail Sales, Empire State Manufacturing Index,, Business Inventories, Import Prices, and Fed Yellen’s testimony before the US Senate Banking Committee.
A very busy Wednesday will start early with New Zealand’s CPI; China’s Fixed Asset Investment, GDP, Industrial Production, and NBS presscon; UK Claimant Count Change, Average Earnings Index, and Unemployment Rate; Canada’s Manufacturing Sales, BOC Rate Announcement and Statement, presscon, and Monetary Policy Report; US PPI, Capacity Utilization Rate, Industrial Production, TIC Long-Term Purchases, and Beige Book.
Thursday will start with Australia’s CB Leading Index and NAB Quarterly Business Confidence; Eurozone CPI; Canada Foreign Securities Purchases; US Unemployment Claims, Housing Starts, Building Permits, and Philly Fed Manufacturing Index
Friday ends the week with BOJ’s Monetary Policy Meeting Minutes; Canada CPI and Wholesale Sales; and US preliminary UoM Consumer Sentiment.