Forex Market: USD/BRL daily trading forecast

Yesterday’s trade saw USD/BRL within the range of 2.2605-2.2880. The pair closed at 2.2803, gaining 0.16% on a daily basis.

At 8:07 GMT today USD/BRL was up 0.06% for the day to trade at 2.2814. The pair touched a daily high at 2.2818 at 5:45 GMT.

Fundamental view

United States

The number of people in the United States, who filed for unemployment assistance for the first time during the week ended on August 8th, probably increased to 294 000 from 289 000 in the prior week. This is a short-term indicator, reflecting lay-offs in the country. In case the number of initial jobless claims increases more than projected, this would have a bearish effect on the greenback. The Department of Labor is to release the weekly report at 12:30 GMT.

The number of continuing jobless claims dropped to the seasonally adjusted 2 518 000 during the week ended on August 1st, from 2 539 000 in the previous week. This indicator represents the actual number of people unemployed and currently receiving unemployment benefits, who filed for unemployment assistance at least two weeks ago.

Brazil

Annualized retail sales in Brazil probably rose at a pace of 5.58% in June, according to the median estimate by experts, following another 4.8% gain in May. In monthly terms, sales probably increased 0.6% in June, after a 0.5% climb in the prior month. This indicator reflects the change in the total value of inflation-adjusted sales by retailers in the country and provides key information regarding consumer spending trend in a shorter term, while the latter is a key driving force behind economic growth. Therefore, a higher than expected rate of increase in sales usually has a positive effect on the local currency.

Retail sales in Brazil climbed at a record-high annualized rate of 15.70% during March 2010.

Instituto Brasileiro de Geografia e Estatística (IBGE) is scheduled to release the official numbers at 12:00 GMT.

Technical view

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 2.2763. In case USD/BRL manages to breach the first resistance level at 2.2920, it will probably continue up to test 2.3038. In case the second key resistance is broken, the pair will probably attempt to advance to 2.3195.

If USD/BRL manages to breach the first key support at 2.2645, it will probably continue to slide and test 2.2488. With this second key support broken, the movement to the downside will probably continue to 2.2370.

The mid-Pivot levels for today are as follows: M1 – 2.2429, M2 – 2.2567, M3 – 2.2704, M4 – 2.2842, M5 – 2.2979, M6 – 2.3117.

In weekly terms, the central pivot point is at 2.2786. The three key resistance levels are as follows: R1 – 2.3100, R2 – 2.3389, R3 – 2.3703. The three key support levels are: S1 – 2.2497, S2 – 2.2183, S3 – 2.1894.