EUR/USD Trades in a sideways move, while oil price may fall further

The Chinese house price index for August printed the same prior read of 4.8%, while the Japanese industrial production number of -15.5% for July came in better than the prior print of -18.2%,

Nonetheless, these releases did not have any noticeable effect on their respective currencies.

Equities

Asian stock markets were boosted on Monday as AstraZeneca resumed its trials for the Coronavirus vaccine after putting them on hold last week due to the unexplained illness of a participant. The pharmaceutical giant stated that trails have been resumed after getting approval from the safety watchdogs.

Markets will keep an eye on the Japanese ruling party leadership elections on Monday at 9:00 PM (UAE time) with a good chance of the Japanese Chief Cabinet Secretary Suga to replace Abe as a prime minister. Suga promised he would continue the current economic and foreign policy.

Currencies

The US Dollar index corrected higher and closed the weekly session modestly in the green with a 0.4% gain. On Monday, the price remained flat although, the technical outlook looks neutral and the price may fall towards 92.34.

In turn, EUR/USD corrected lower last week and closed the weekly candlestick with a Doji pattern highlighting the market’s indecision. The technical outlook of the pair remains flat while below 1.1909, a daily close above this level would change the outlook to positive.

GBP/USD retreated last week to a nearly seven-week low as discussed in our last update at 1.2761. The Sterling pound was under pressure amid reports of the UK PM Jonson may abandon the UK-EU trade talks without a deal even he may not honor some parts of the Brexit deal he stroke with the EU last year putting the UK credibility at stake.

Commodities

The US crude oil price declined last week by 3.7% while Brent oil lost 6.2% of its value affected by the lower expectation of demand’s recovery due to surging numbers of COVID-19 cases worldwide.

A close below $39.60 on Brent oil and below $34.90 on US crude would change the technical outlook from neutral to negative.

Gold remained flat and closed with a 0.3% gain above $1,921for the fifth week in a row hinting that XAU/USD may rally towards $2,015. 

Looking Ahead

Not much today on the economic calendar, on 1:00 PM (UAE time) eyes, will be looking at the Eurozone industrial production numbers for July. However, starting from Tuesday until the end of the week investors' eyes will be on high important European, UK, and US data, alongside interest rates for three major central banks (Fed, BoJ, and BoE).