FX traders, we are now entering the new month of August which is bound to continue providing us with many trade opportunities. Looking ahead this month, the road seems a bit unclear as we may not see policy changes from the major central banks. So, our main focus will remain on technicals.

Today, we have five major fundamentals that are worth watching. For tips on how to trade the news, make sure to check out FX Leaders News Trading Strategy article.

Five Economic Events To Watch Today

AUD- RBA Rate Statement & Cash Rate – The Reserve Bank of Australia will declare its Cash rates at 4:30 (GMT). The central bank is supposed to leave interest rates unchanged at 1.50%. Yet, the statement will be worth watching to see the further outlook of the economy. The Australian dollar is already on the move.

USD – During the US sessions, the Institute for Supply Management is expected to publish the ISM Manufacturing PMI at 14:00 (GMT).    

GBP – The Marik is also due to release the Manufacturing PMI at 8:30 (GMT) and it's likely to beat the previous figure of 54.3.

Manufacturing PMI's is a leading indicator of economic health and businesses' reactions to market conditions. Since businesses purchasing managers hold perhaps the most current and relevant insight into the company's view of the economy, it gives us a very accurate read.

EUR – Eurostat is due to release Prelim Flash GDP q/q at 9:00 (GMT) with a neutral forecast of 0.6%. Today it may work as a catalyst to shake the Euro currency pairs. The Prelim Flash GDP q/q is the broadest measure of economic activity and the primary gauge of the economy's health. Most of the central bankers decide their interests rates based on the GDP growth rate.

Therefore, any positive surprise in the number will increase the probability of ECB being hawkish and will give the single currency Euro another round of buyers.

NZD – At 22:45 (GMT) the New Zealand Statistics is scheduled to release labor market figures. The Employment Change q/q is forecasted below the previous 1.2%, at 0.7%. But, the Unemployment Rate is forecasted at 4.8% which is better than the previous figure of 4.9%. The mixed results will ruin the trade, so it is a good idea to enter the market only if you see one sided data.

EUR/USD – Double Top Breakout

In my previous report, I discussed double top resistance at $1.1775 which was keeping the single currency under pressure. It kept on trading below this level until the release of the Chicago PMI which fell to 58.9 for July from 65.7 the previous month. It had a big impact in weakening the US dollar because the figure was below the anticipated 60.0, the lowest reading for 3 months.

As mentioned in my colleague Ron's update earlier, the inflation figures from the Eurozone met expectations but came with no big surprises.

EUR/USD – 2-Hour Chart – Bullish Channel 

So, what else caused bulls in Euro? The breakage of the double top pattern at $1.1775. Now, the pair is testing the upper corner bullish channel at $1.1850 which is working as a resistance at the moment. The immediate support is at $1.1800.

Today, above $1.1800 level, the EUR/USD has the potential to stay bullish with a target of $1.1880. On the other hand, breakage of $1.1800 will lead the pair towards $1.1765. The previous double top resistance becomes a support level.

EUR/USD – Key Trading Levels

Support     Resistance

1.1802          1.1883    

1.1760          1.1925    

1.1679          1.2006

EUR/USD Trading Plan

Since the calendar is full of fundamentals, it's better to wait for the releases before taking up positions. I'm looking at $1.1800 but would only take a buy position above it. Below this, I will be looking to sell at $1.1765. Check out our FX Leaders article on how to trade the EUR/USD signals, to upgarde your pair trading techniques.