It is PMI day in Europe
The dollar is keeping firmer to start the day, after having posted solid gains in trading yesterday. AUD/USD broke below its 9 September low @ 0.7191 and the downside pressure is continuing to build with EUR/USD also testing waters under 1.1700 now.
The technical breaches above are continuing to keep the dollar underpinned, with cable still testing the confluence of its key daily moving averages so far today.
Elsewhere, gold is also starting to take a peek under $1,900 as the previous wedge consolidation pattern shows further confirmation of a break to the downside.
The bid in the greenback comes despite stocks recovering some ground in trading yesterday, which is still leaving for some question marks about the risk mood this week.
Looking ahead, we'll be getting September PMI data from the euro area but it is likely to reaffirm the narrative that the pace of the recovery is moderating and potentially meeting some resistance amid the latest virus developments.
The potential divergence on the breach of technical levels in dollar pairs and risk sentiment in the market is also one to watch as we will have to see how said flows (the push and pull) will play out for the remainder of the week.
0600 GMT - Germany October GfK consumer confidence
Prior release can be found here. A general indication of consumer morale in the German economy, which showed signs of leveling off last month; reflecting an arguably similar mood to economic confidence in the European region as of late.
0700 GMT - Spain Q2 final GDP figures
The preliminary report can be found here. As these are final figures and pertain to Q2, they aren't really of much relevance at this point in time.
0715 GMT - France September flash manufacturing, services, composite PMI
0730 GMT - Germany September flash manufacturing, services, composite PMI
0800 GMT - Eurozone September flash manufacturing, services, composite PMI
The readings today are expected to reflect some moderation in the European economic recovery, as business conditions hit a bit of a ceiling after having played catch up to pent up demand in recent months. The ongoing concerns surrounding labour market conditions also aren't helping and the resurgence of the virus only adds further headwinds to the economic recovery towards the latter stages of the year.
0800 GMT - Switzerland September Credit Suisse investor sentiment
Prior release can be found here. The reading measures analysts' expectations on the Swiss economy and other economic expectations over the next 6 months. A minor data point.
0830 GMT - UK September flash manufacturing, services, composite PMI
Prior releases can be found here and here. Similar to Europe, the UK economic recovery is expected to encounter some moderation with the resurgence in virus cases not really helping with consumer confidence in recent weeks. With the government also potentially announcing tighter restrictions moving forward, that won't really help spur economic confidence all too much - not to mention with the lack of added fiscal support.
1100 GMT - US MBA mortgage applications w.e. 18 September
Weekly US housing data, measures the change in number of applications for mortgages backed by the MBA during the week. The focus will once again be on purchases as that has been one of the more bullish spots outlining that US economic conditions are not as dire as first suggested by the recent dip due to the coronavirus impact.
That's all for the session ahead. I wish you all the best of days to come and good luck with your trading! Stay safe out there.
