Operators' attention was focused first and foremost on the traditional semi-annual hearing of the FED President at Congress last week. Jerome Powell was particularly accommodating, reiterating his concerns about global growth due to the trade dispute which may eventually cost Washington. Referring to a "confidence shock" to better prepare markets for a future rate cut, he also admitted that "many" Committee members were now ready to act in this direction. A decline of a quarter of a point is widely expected on July 31, but there is still uncertainty about the central bank's strategy beyond this deadline.

On the macroeconomic side in June, inflation remained moderate: CPI +1.6% over one year (stable), PPI : +1.7% over one year (-0.1%). On the other hand, retail sales, the main indicator of US consumption, exceeded specialists' expectations (+0.4% month-on-month).

In China, growth in the second quarter was up +6.2% year-on-year, its lowest level in nearly 27 years. Conversely, retail sales and industrial production are outperforming expectations this month, which has helped to dampen negative reactions.

In Europe, Germany is showing a new sign of excitement as the ZEW investor sentiment barometer declines in July. Berlin, the main exporter in the Euro zone, is suffering from the trade war and the Chinese slowdown.

On the Brexit front, the two candidates for Prime Minister Boris Johnson and Jeremy Hunt found an unfortunate common ground in their last debate. The two men reject the idea of the Irish backstop, a solution negotiated between Theresa May and the European Union to avoid re-establishing a physical border between Dublin and Belfast, but whose consequence would be to keep the United Kingdom in a form of customs union for an indefinite period. These statements revive speculation about a tough Brexit as early as October 31, while Brussels does not intend to renegotiate the agreement reached at the end of last year. Boris Johnson, the big favorite in the race for 10 Downing Street, has promised to leave Europe with or without an agreement on the scheduled date.

This week and until we know the name of Theresa May's successor, Forex traders will have little to watch for, except for the development of a G7 Finance that should not really affect the foreign exchange market.

Graphically, the Euro never really stops threatening its support. Favoring again and again sales on rebound, we keep in mind 1.1130 and 1.10 as our next objectives.

On the other side of the Channel, the Pound has distinguished itself by moving into new lows since April 2017, while the latest extremes below USD 1.20 no longer seem out of reach. Against the Euro, the Pound is even about to sign an eleventh consecutive negative week, a record since the creation of the single currency that could cause a new pause.

On the safe haven side, the Franc remains strong and the EUR/CHF pair offers excellent entry timing to long-term buyers below CHF 1.1150. Finally, the configuration of the USD/JPY pair highlights more indecision in trade, with the greenback temporarily stuck between JPY 107.20 and 109.20.