10:30 (10 hours left) - United Kingdom: Second Estimate Gross Domestic ProductDescription:Released quarterly by the Office for National Statistics, Gross Domestic Product measures the change in the inflation-adjusted value of all goods and services produced by the economy. It's the broadest measure of economic activity and the primary gauge of the economy's health. There are 3 versions of GDP released a month apart; Preliminary, Second Estimate, and Final. The Preliminary release is the earliest, thus tends to have the most impact.Summary:The pound has remained relatively well supported over recent sessions as market expectations over the UK's EU referendum have became increasingly optimistic as recent polls show an increasing lead for the 'remain' campaign. The latest poll by Ipsos MORI suggesting an 18 point lead to the 'remain' campaign and ORB a 13 point lead, both resulted in cable rallying over 200 pips with GBP pairs supported across the board. Although economic data may still influence GBP, any news regarding the UK's EU referendum will likely overshadow economic data, especially as we head closer towards the referendum on June 23.Second Estimate GDP is expected to remain unchanged from the Preliminary reading at 0.4% q/q and 2.1% y/y.Expected Market Reaction:Market sentiment in regards to the UK's EU referendum is likely to remain the primary driver of price action leading into the referendum on June 23. Any significant deviation in the data may provide short term trading opportunities, or if the deviation is in line with sentiment then further exacerbate price action in GBP pairs.
Newyrok session forcast
Current Sentiment:The Asia-Pacific session saw Construction Work Done from Australia miss estimates with a decline of -2.6% versus -1.4% expected, whilst New Zealand Trade Balance figures posted a wider than expected surplus at 292M versus 60.0M expected.The main data release during today's London session was German Ifo Business Climate which printed at 107.7 versus 106.9 expected, EURUSD and EURGBP however both remain near session lows, benefiting from positive sentiment in both USD and GBP. Market sentiment remains overall positive as the news of a new Greek deal is supporting equities and an overall risk on environment.Coming up in today's New York session, the main highlight will be the latest interest rate announcement and accompanying statement from the BoC, shortly followed by this weeks release of Crude Oil Inventories.*New updates to the fundamental section will be left in bold for 24 hours*USD: Minutes from the April 26-27 meeting were hawkish and woke the market up to the chance of a hike in June; Fed Fund futures jumped from 12% to 33%. CPI for April came in close to estimates across the board with Core CPI at 2.1% y/y. NFP for April missed on the headline figure at 160k vs 202k expected. However, Average Hourly Earnings came in as expected at a solid 0.3% rise for the month, which bodes well for the inflation picture and prompted some upside in the USD post release.EUR: Inflation data for April printed in line with expectations, pushing the Eurozone back into deflation. CPI y/y printed at -0.2% with Core CPI printing at 0.7%. Flash GDP for Q1 missed expectations at 0.5% q/q versus expectations of 0.6%, and at 1.5% y/y versus expectations of 1.6%. GBP: Average Weekly Earnings for March increased by 2.0%, above expectations of 1.7%, Claimant Count Change also beat expectations, decreasing by 2,400 vs an expected increase of 4,000. CPI data for April missed estimates across the board with CPI y/y declining to 0.3%, below expectations of remaining unchanged at 0.5%, core CPI y/y missed at 1.2% versus expectations of 1.4%.AUD: The minutes from the May 3 meeting showed the RBA considered waiting for more data before cutting rates. The RBA's Statement on Monetary Policy cut inflation forecasts, cementing the chance of future rate cuts. RBA cut the OCR to a new low of 1.75% on May 3. The Bank had clearly signalled their intention to do so in the prior decision statements, if inflation moved lower. CPI for Q1 missed by a wide margin with Trimmed Mean CPI printing at 1.7% y/y, below expectation of 2.0%.NZD: Inflation Expectations for 2 years out sit at 1.64%. The FSR showed concerns over rising house prices but failed to introduce any new macroprudential controls, which suggests the RBNZ will remain on hold in June. Q1 employment was mixed with the jobless rate rising to 5.7% but job growth smashing estimates at 1.2% q/q.CAD: Core CPI for April rose by 2.2% y/y versus expectations of 2.0% and by 1.7% for headline CPI y/y in line with expectations. A neutral to weakly-bullish currency, with sentiment in lock-step with WTI.JPY: The BoJ kept policy unchanged at the April 28 meeting, which saw massive strength in yen across the board, given the market pricing for a potential announcement of further easing. The BoJ may ease further at the next meeting on June 16. Tokyo CPI Ex-Food & Energy for April was at 0.6% y/y. The BoJ measure of National Core CPI remained steady in at 1.1% y/y for March.CHF: CPI beat estimates for April, printing at 0.3% m/m, above the 0.1% expected. Fundamentally a weak currency, highly correlated with moves in EUR.Technicals:We will be monitoring levels of support and resistance in unison with any impactful news and the underlying fundamentals in order to find a high probability trade. Support and resistance includes previous highs and lows (horizontal s/r), trendlines, moving averages, fibonacci retracements, daily pivot levels and round numbers. These levels of support and resistance are most effective when there are several of them converging at the same area (confluence).