US Retail Sales is just one piece of economic data but, with the USDX lurking under major resistance, an upbeat print here might just give the index the chutzpah it needs to break this big 100 level.
Trading chatter seems to point to an improved result expected on the retail front but this could be moderated by any earnings miss from one, or both, of JP Morgan and Wells Fargo. Both report before the market open. Conversely, upbeat earnings data could help cheer the US$ and stocks. Thus, the next US session could be an exciting one and there is US PPI data tucked in there as well!
USDX 4hr: watch for any break and hold back above the 100 level. Clearly, the longer the time frame for this hold the better. That is, a weekly hold is obviously more convincing than just a 4hr hold:
E/J daily: In my w/e analysis I had emphasised to watch the 127 level. The daily close below this has seen bearish continuation. There are ramifications here for the E/U:
E/U daily: I had also mentioned to watch the 1.045 level on the E/U and this is now coming into greater focus. Watch this level with US Retail Sales. This might just be the news to trigger a USD index breakout and this would most probably push the E/U below this ‘Double Bottom’ support. And… there is still ECB interest rate news to come, after all this, tomorrow:
A/U 4hr: watch also for reaction to US Retail Sales BUT don’t forget tomorrow’s Chinese GDP:
Kiwi 4hr: much the same strategy here as for the A/U:
Cable 4hr: watch here for tonight’s GBP CPI and, then, US Retail Sales. I’m out tonight so will miss the GBP data release. Price continues to hug the ‘neck line of the weekly chart’s H&S pattern:
GBP/JPY daily: also watch this with GBP CPI and for any daily close below or bounce up off the ‘neck line’ of this potential daily chart H&S: