Now that the fanfare surrounding the US-China trade deal has wound back, we are starting to get some focus back on the key fundamentals.

For most central banks, their main responsibility is actually to just look after inflation. They don’t want it too high, or it devalues the currency. While low inflation is indicative of poor growth. Ideally, most central bankers, like to see inflation around the 2-3% range.

Today, the attention will be on Europe as we get CPI from the UK and Eurozone. Both are still beneath the target band, however, not surprisingly, it is the Eurozone that is a long way off.

They are looking at only 0.9% YoY which is very sluggish. Mario Draghi has been battling this issue for his entire reign and would love to see an uptick before he departs.

The UK, on the other hand, isn’t actually too bad and is sitting around 1.8%. Which is quite strong relative to many other economies at the moment.

Either way, we will need to watch the EUR/USD and GBP/USD around these key data points, while the Brexit talks will also be a dominant theme as ever.

In the US session, we get retail sales which will be the big one, while there is more CPI ahead for Canada and the USD/CAD.

Forex Signal Update

The FX Leaders Team had a solid day with 3 wins from 5 signals to start the week.

GBP/USD – Pending Signal

The GBP/USD has seen significant volatility in the lead up to the next Brexit ‘deadline’. We saw a sharp move higher yesterday and that could easily retrace today. 

Oil – Pending Signal

WTI was relatively flat yesterday and price is still under the key $54. As we head into Tuesday, we start the important data for the week, firstly with API inventories, followed by the official supply data tomorrow. We are still hunting a long position for the time being.

Cryptocurrency Update

BTC has continued to slowly fall away this week and we are really closing in on a test of $8,000.

That will really be the line in the sand for us, as we really haven’t been able to break out of this area of consolidation.

To the upside $8,500-600 is solid resistance and beneath $8,000, we’ve seen $7,800 hold three times. That suggests price is still unsure of where it needs to be, but given the long-term downtrend, we should remain with a bearish bias until proven otherwise.