FX Outlook 7/4-7/8

Alright, after a little camping trip last week I'm back from hiatus and ready to trade this upcoming week.  Since Monday is Independence Day here in the States, I'm expecting volume to be lighter across the board.  The US equity markets showed a very strong rally last week, but most of it was on lower volume and we're now entering the resistance area near this year's high's between 135 and 137 in the SPYs.  I'm not expecting a ton of movement in the US markets ahead of Friday's NFP data, but I think those numbers will be very important for the markets in the coming months.

EUR/USD

The euro gained on the dollar last week and appears to be out of immediate danger since Greek austerity measures were passed and are in good position to receive approval from the IMF for their next tranche of bailout money.  We look to be consolidating a little bit on the daily chart, and I expect most people will be trading the news this week.  As QE2 comes to an end & the Eurozone is pulling itself together at least in the short term, the dollar needs some strong numbers this week or it may continue to slide.

GBP/USD

The dollar also gave some ground to the pound last week, but the pair is still in a downtrend that's looking a little bit steep on the daily's.  Again, I think the beginning of the week may be a little bit slow but the BoE rate decision and NFP's at the end of the week should be a catalyst for movement.  I think we'll continue to move downwards in the short term mainly on pound weakness rather than dollar strength.

AUD/USD

Greek austerity has helped the aussie dollar a lot in the past week as many people's appetite for risk has returned.  Another strong week could put it up near yearly high's against the dollar, and we're still in a long term uptrend dating back to about a year.  This week we'll be seeing a RBA rate decision and employment data, both of which need to come out at or above expectations to keep this short term upmove going.  Anything under expected could lead to a bullish outlook for the aussie.

USD/CHF

This pair has been downtrending forever now, but we may have put in a little double bottom 0.8315.  I'm expecting to consolidate between this level and the downtrend line, but the mid-term outlook might hinge on this Friday's NFP's.  Also, look for some minor swiss data this week that may cause some movement, but Friday's numbers will be the most important.

That's probably all I'll really follow this week, maybe the NZD/USD as well since the kiwi has GDP numbers coming.  As always, the market's opinion is much more important than my opinion.  Trade what the market gives you, not what you think the market should do.  Hopefully I'll trade a little better than I played golf today (lets just say I definitely got my money's worth with how many swings I took), and I'm hoping to get one more post up this week at least.  Have a good holiday if your in the US, and good trading to everyone this week!