EURUSD and GBPUSD test current lows
If we look at the EURUSD pair on the four hour time frame, we see that we currently have support at 1.17200 and we are currently testing the MA20 moving average. To stay on the bullish side, we need a break above this current resistance in order to have a chance to climb to the 61.8% Fibonacci level at 1.17570; further above the nearest resistance we find the MA50 and MA200 moving averages in the 1.17800 zone. To stay on the bearish side, we need another negative consolidation and dip below the 78.6% Fibonacci level to 1.17160, and then expect new tests of yesterday’s lows at 1.17000.
GBPUSD chart analysis
Looking at the chart over the four hour timeframe, we see that the GBPUSD pair will soon test the previous August 20th low of 1.36000. We are now at 1.36273 and will definitely test the previous low under this downside pressure. Below that, the next support and new target for the July 20th bearish scenario is 1.35716. If we think of the bullish side, we need a positive consolidation first and a return above the MA20 moving average of 23.6% Fibonacci levels at 1.39920. After that, our next resistance is at the 38.2% Fibonacci level at 1.37475, with additional resistance in the MA50 and MA200 moving averages.
The Organization for Economic Co-operation and Development has raised its growth forecast for next year, but scaled it down for this year, expressing concerns about the increasingly mixed nature of the economic recovery following the pandemic decline and rising inflationary pressures.
The global growth forecast for next year is now 4.5 percent compared to 4.4 percent forecast in May, according to an interim report published in Paris on Tuesday.
The forecast for this year has been lowered from 5.8 percent in May to 5.7 percent.
“The economic impact of the Delta variant has so far been relatively weak in countries with high vaccination rates, but it has reduced short-term dynamics elsewhere and increased pressure on global supply chains and costs,” said the OECD.
“The measures have been effective to mitigate shocks and ensure a strong recovery; More efficient public finance planning is needed, diverted to investment in physical and human capital, and it will help return monetary policy to normal once the recovery is well established, “said the OECD chief. And economist Laurence Boone said.
The uneven recovery from the decline caused by the Covid-19 pandemic is exacerbated by large differences in vaccination rates between countries. The OECD said coronavirus outbreaks are forcing some countries to restrict their activities, leading to congestion and supply shortages. Disruptions in the supply chain and higher delivery costs increase prices.
In this context, the OECD expects inflation to slow to around 3.5 percent next year, after reaching a high of 4.5 percent at the end of this year.
“Supply pressures should gradually ease, wage growth remains moderate and inflation expectations remain anchored, but short-term risks are increasing,” the report said.
German business news
The German economy is expected to grow faster next year than previously estimated, but has reduced its outlook for 2021, citing the effects of supply-side bottlenecks on the manufacturing sector.
In the autumn forecast, the research team raised the growth prospects for 2022 from 5.3 percent to 5.1 percent.
The faster growth is mainly due to the low production of goods and services in 2021. In 2022, the momentum of the macroeconomic recovery will weaken, said Ifo.
The forecast for 2021 has shrunk from 3.3 percent to 2.5 percent as bottlenecks in manufacturing have slowed the general recovery.
The added value in production is currently declining, while the service activities with intensive contacts have recovered strongly. The economy is divided, said Ifa chief economist Timo Vollmershäuser.
In 2023, the German economy will grow again at an average pace, according to the research center.
According to the IFU, the inflation rate is likely to rise further to around 4.5 percent by the end of the year.
The inflation rate is expected to average 3.0 percent in 2021, after an average of only 0.5 percent in the 2020 crisis. The forecast for this year has been raised from 2.6 percent.
In the next two years, the price increase trend will slow down from an annual average of 2.3 percent to 1.6 percent.
The current lows after testing EURUSD and GBPUSD first appeared on FinanceBrokerage.