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The Week Ahead 20th Aug 2018

The week ahead will mainly be influenced by central bank’s (RBA, FOMC and ECB) publication of recent monetary policy minutes. Additionally market participants will closely watch any developments during the annual Jackson Hole Economic Policy Symposium which is scheduled to run from 23rd until 25th Aug.

Tuesday 21st Aug at 2.30am Reserve Bank of Australia (RBA) meeting minutes are published which will provide a full account of the recent policy decision and how the individual committee members voted. This data could impact volatility in Australian equities and also AUD currency crosses.

Wednesday 22nd Aug at 7.00pm FOMC minutes are due for release. There was no change to the base rate levels at the latest meeting. These minutes may not indicate anything new, however US Dollar rallied over the past month and any significant changes to the current FOMC hawkish tone and sentiment could possibly impact volatility in US Equities and also in US Dollar currency crosses.

Thursday 23rd Aug at 12.30pm ECB meeting minutes are due for release. Any mention of ECBs intentions to move towards a rate hike and monetary policy tightening earlier then currently forecasted Q3 of 2019 could increase volatility in European equities and also EUR currency crosses.

EURUSD

Price action is down trending, currently capped by initial upside resistance at 1.1515 level. Bearish sentiment prevails below targeting downside supports at 1.1300 which is the current swing low followed by 1.1270 and 1.1200 levels. Alternatively confirmed breakout above initial resistance at 1.1515 and the Daily close higher, could open up the way for the retest of additional upside resistances at 1.1560 followed by 1.1600 levels.

GBPUSD

This currency pair is currently trading below 20, 50 and also 200 Daily moving averages creating lower highs and lower lows. Upside is initially caped by resistance at 1.2900. Price action appears bearish below targeting downside supports at 1.2660 followed by 1.2600 and 1.2550 levels. Alternatively confirmed breakout above 1.2900 resistance and the Daily close higher could open up the way for the retest of additional upside resistances at 1.3020 followed by 1.3130 levels.

USDJPY

USDJPY is trading back below psychologically important 111.00 level which is now offering the first resistance on the upside. Bears appear in control below that level targeting downside supports at 110.30 followed by 110.00 and 109.50 levels. Alternatively a confirmed breakout back above 111.00 and the Daily close higher would open up the way for the retest of the additional upside resistances at 111.50 followed by 111.80 levels.

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