19.06.201911:57 Forex Analysis & Reviews: EUR and GBP: Euro and pound may remain under pressure before an important meeting of the Federal Reserve, which can announce a change in policy

The euro fell against the US dollar on Tuesday after a speech by Mario Draghi, which I talked about in more detail on yesterday's review. The data released on the American economy in the second half of the day did not greatly affect the situation of the pair.

According to the report of Retail Economist-Goldman Sachs, the index of sales in US retail chains rose by 2.7% in the week from June 9 to 15 compared with the previous week. Most of the growth was due to higher activity of consumers in stores of uniform prices. Compared to the same period in 2018, the index increased by 3.1%. Growth rates are preserved, as the index rose a week earlier by 1.4% compared with the previous week.

Over the two reporting weeks, the retail sales index rose by 4.1%.

As for retail sales according to Redbook, the situation is a bit different.

If in the week from June 9 to June 15, retail sales increased by 5.4% compared to the same period in 2018, and increased by 5.2% in the first 2 weeks of June, in the first 2 weeks of June, compared to May, a fall in sales occurred by 2.4%.

Data on new housing startups in May of this year was also ignored by the market, despite the fact that the weakness of the US housing market continues to grow.

According to a report by the US Department of Commerce, the number of new housing starts in May 2019 that was decreased by 0.9% compared with the previous month and amounted to 1.269 million.

Permits for the construction of residential buildings rose only 0.3% compared to the previous month up to 1.294 million. Economists predicted that the number of bookmarks in May will decrease by 0.4%, while the number of building permits will fall by 0.5%.

As for the technical picture of the EURUSD pair, the further direction of the market will depend entirely on the current decision of the Fed on interest rates. Although none of the economists expects rates to be lowered during the meeting, the committee may declare monetary policy easing in the future, which will hit the US dollar.

On the other hand, yesterday, ECB President Mario Draghi also announced the likelihood of lowering the interest rates and a return to the asset repurchase program, which in the medium term, will limit the upside potential of risky assets.

A break of support at 1.1180 will increase the pressure on the euro and thus lead to the renewal of the next lows in the area of 1.1140 and 1.1080. If the Fed chairman is quite sharp in his statements, the short-term demand for the euro may return, which will allow the bulls to break through the resistance of 1.1240 and update the highs around 1.1290 and 1.1340.

Yesterday, the British pound slightly strengthened its position after the news that Boris Johnson won the second round of voting against the new leader of the Conservative Party. The next round of voting includes Boris Johnson, Michael Gav, Jeremy Hunt, S. David, Rory Stewart.

Today's pound movement will be based on data on inflation, which can return to the market of large sellers, and will lead to a breakthrough of support at 1.2510 for GBPUSD and further sale to the minimums of 1.2440 and 1.2340.