The Fed to raise interest rates

The U.S. Federal Reserve is expected to raise its interest rate this week, the central bank will communicate its decision tomorrow. Fed policymakers will also release their latest set of quarterly projections on growth, unemployment and inflation. Previously, Fed raised rates by 25 basis points in its March meeting and this had caused unemployment rate to fall to a 16-year low. Meanwhile, the U.S. PPI for May is due at 12:30 GMT today, and this can influence the U.S. dollar.

source: Reuters, theguardian

U.K. household spending fell for the first time since 2003 amid pressures from rising prices and political uncertainty. Furthermore, the inconclusive result of last week’s snap general election can add more uncertainty among consumers and businesses. Investors should not miss today’s U.K. Consumer Price Index report for May which is due at 08:30 GMT as this could shed more light on purchasing trends and inflation.

Elsewhere, Germany’s Eurozone ZEW Economic Sentiment for June and the Eurozone ZEW Economic Sentiment, are both due to be released at 09:00 GMT. Readings for these are expected to alter trends of the euro on the market. Additionally, Sabine Lautenschlaeger, the member of the European Central Bank will deliver a speech at 09:00 GMT, and her comments may contain indications on future monetary policy.

Technical Analysis

GBP/JPY

GBP/JPY

This currency pair was seen heading to a downtrend on Monday as it started losing momentum as from 06:00 UTC, followed by several pullbacks to close by 11:00 UTC at the 139.330 level. Its lowest level for yesterday was at 138.757 around 16:00 UTC. The asset started off on a negative note today as it dropped as from 00:00 UTC to reach the 139.137 level by 03:00, and started picking up heights from the next hour. It could fluctuate later during today.

AUD/USD

AUD/USD

After recording several momentary jumps on Monday, the AUD/USD pair started tumbling as from 15:00 UTC to reach a low level at $0.75269 by 17:00 UTC. Opening at the 0.75269 level today at 00:00 UTC, the asset edged up by 0.24 percent. Later, around 03:00 UTC, the asset started dropping on the forex market and may follow a downtrend. Use the FX/CFD tool to trade this currency pair.

DXY

DXY

The dollar index was seen much volatile in yesterday’s early trading hours, however, it started picking strength as from 12:00 UTC to reach a highest level of 97.28 at 16:00 UTC. Today, it opened its session bullishly at the 97.19 level at 00:00 UTC, thus following the uptrend set on Monday. The index may gain more bullish candles through the day and follow an uptrend, thus demands much attention, consider trading this today.

Things to watch on the market

Tip 1

The EUR/USD, AUD/USD and the GBP/USD pairs are the most important assets this week since major economic events can impact trends of these.

 

Tip 2

The EUR/GBP, GBP/JPY and GBP/CAD pairs can be traded, along with the FTSE 100 or the FTSE MIB F-JUN16 and are available on the Classic Binary Options.

 

Tip 3

The DAX and the euro could generate good trading opportunities today.