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Daily Pivots: (S1) 1.3205; (P) 1.3249; (R1) 1.3285; More… A temporary top is formed at 1.3291 after GBP/USD failed to break through near term channel resistance and retreated. Some consolidations would be seen first, but further rally is expected as long as 55 4H EMA (now at 1.3078) holds. Above 1.3291 will resume the rise […]

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The highlight in the European session will be the ECB rate decision, although it’s unlikely that the central bank will surprise the markets in any way. In the American session, we have the US Jobless Claims which are now even more important given that they could give an earlier signal of deterioration in the labour market. It’s unlikely to see much reaction though unless they make a new cycle high.

12:15 GMT/08:15 ET – ECB Policy Announcement

The ECB is
expected to cut by 25 bps bringing the deposit rate to 2.25%. The market then
expects at least two more rate cuts by year-end. Interest rates expectations
have been shaped by the ongoing trade war and the recent 90-days pause for
reciprocal tariffs helped to alleviate the aggressive pricing. It’s all
about the trade negotiations now as the data remains old news.

12:30 GMT/08:30 ET – US Jobless Claims

The US Jobless
Claims continue to be one of the most important releases to follow every week
as it’s a timelier indicator on the state of the labour market.

Initial Claims
remain inside the 200K-260K range created since 2022, while Continuing Claims hover
around cycle highs.

This week Initial
Claims are expected at 225K vs. 223K prior, while Continuing Claims are seen at 1872K vs. 1850K prior.

Central bank speakers:

• 15:45 GMT/11:45 ET – Fed’s Barr (neutral – voter)

This article was written by Giuseppe Dellamotta at www.forexlive.com.

• Tariffs present a major challenge, uncertainty unseen for a long time in Japan
• Difficult to assess the impact of tariffs on the economy and prices currently

It’s not just Japan but pretty much all central banks across the globe that is feeling this way. It’s the same for the Fed as well when viewing Powell’s remarks yesterday.

This article was written by Justin Low at www.forexlive.com.

• German DAX futures -0.1%
• French CAC 40 futures -0.2%
• UK FTSE futures -0.4%

There is a balance to be struck with European indices needing to catch up a little to the declines in Wall Street overnight and also the bounce in the risk mood so far today. At the balance, that is pointing to a more neutral open perhaps later in the day. S&P 500 futures are seen up 0.9% currently.

This article was written by Justin Low at www.forexlive.com.